LithiumBank Resources Corp. (TSX-V: LBNK) (OTCQX: LBNKF) is pleased to announce it has entered into a definitive asset purchase agreement with Pristine Lithium Corp. whereby the Company will sell to the Buyer the Company’s three lithium brine projects, Estevan, Kindersley and South located in Saskatchewan, Canada.

In accordance with the terms of the Agreement, the Company will sell the Assets to the Buyer in exchange for:

• cash consideration of an aggregate of C$2,000,000 payable as a C$250,000 deposit within two days of the execution of the Agreement and an additional C$1,750,000 payable on closing of the transaction;
• 40,000,000 common shares  in the capital of the Buyer, which will represent approximately 47% of the outstanding Buyer Shares on a post-financing basis;
• 20,000,000 warrants, each exercisable into one Buyer Share for a period of two years from the date of issuance at an exercise price of $0.45 per Buyer Share (the “Warrants”) upon the occurrence of certain conditions;
• upon filing a “Preliminary Economic Assessment”, as such term is defined in National Instrument 43-101 – Standards of Disclosure for Mineral Projects in respect of any of the Assets, the Buyer will, at its election, issue Buyer Shares to the Company with a fair market value of C$1,000,000 or pay the Company an additional C$1,000,000 in cash; and
• the right to appoint one member of the board of directors of the Buyer if LithiumBank holds at least 20% of the Buyer Shares or one observer position to the Buyer Board if LithiumBank holds at least 10% of the Buyer Shares.

The Share Consideration, the Warrants and any underlying Buyer Shares issuable upon the exercise thereof will be subject to a voluntary hold period from the date of issuance and will be released in instalments in accordance with the Agreement, with the final release occurring on the 24-month anniversary of the closing date of the Transaction. The end of the voluntary hold period will coincide with the final share release.

Pristine Lithium will also complete a concurrent best efforts private placement at a price per security of at least $0.30 for aggregate gross proceeds of not less than C$9,000,000. The Concurrent Financing will be conducted by Echelon Capital Markets, as lead agent and sole bookrunner, on behalf of a syndicate of agents. Further details regarding the Concurrent Financing will be announced in due course once final terms have been determined.

“The strategic sale of our Saskatchewan Assets to Pristine Lithium will expedite the unlocking of our Saskatchewan properties true potential while allowing LithiumBank to maintain a level of ownership of these assets. LithiumBank is now well positioned to focus on the development of Boardwalk and Park Place without the expense and share dilution related to developing multiple projects in two jurisdictions,” said Rob Shewchuk, CEO of LithiumBank. “We look forward to being supportive partners as Pristine becomes the lithium brine leader in Saskatchewan.”

“With this transaction, we are excited to be taking the first step towards creating a leading lithium brine developer based in Saskatchewan,” commented Nikolas Matysek, CEO of Pristine Lithium. “The Pristine team has the in-province experience and focus to rapidly advance our foundational assets. We are appreciative of LithiumBank’s support as Pristine advances the projects with a fully funded and dedicated management team, strong local connections, and access to Direct Lithium Extraction technology.”

Using the non-dilutive capital from the asset sale, over the next 12 months LithiumBank expects to fund pilot plant studies on both Boardwalk and Park Place. The Company will also focus on capturing the near-term PEA enhancement opportunities that can drive positive incremental financial performance (see May 25, 2023 News Release). LithiumBank believes these technical, financial and tax improvements have the potential to position both the Boardwalk and Park Place districts among the more attractive direct brine projects in North America.

The closing of the Transaction is subject to certain customary closing conditions, which include:

• the completion of the Concurrent Financing by Pristine Lithium;
• the receipt of applicable governmental or regulatory approvals, including the conditional approval of the TSX Venture Exchange; and
• the receipt by the Buyer of conditional listing acceptance of the Buyer Shares on the TSXV.

The Transaction is expected to be completed in the fall of 2023 with an outside date of January 2024.

Saskatchewan Assets

The sale of the Assets is expected to make Pristine Lithium the second largest permitholder in Saskatchewan with 336,595 acres of mineral permits across three separate property areas (see Figure 1). Each property targets the Duperow Formation, which is a stratigraphic equivalent to the Leduc Formation in Alberta which hosts the Boardwalk and Park Place assets.

Figure 1: LithiumBank’s Saskatchewan lithium brine projects under agreement to be sold to Pristine Lithium.

Kindersley

The Kindersley permits are expected to form Pristine’s most advanced project in Saskatchewan. A hydrogeological report was completed in November 2022 by Matrix Solutions Inc. which indicates favourable permeability and porosity characteristics and in-situ brine volume as described below. Matrix is expected to continue technical work on behalf of LithiumBank and Pristine going forward.

• Project size: 111,282 acres, 174 sections of Crown mineral permits
• Development status: Reservoir characterization
• Next milestone: NI 43-101 mineral resource estimate
• Depth to reservoir formation: 1,100 metres
• No H₂S or significant hydrocarbons in reservoir
• In November 2022, the Company completed a hydrogeological study that indicated:
  • The Duperow Formation, within the Kindersley Project area hosts a brine volume of 3.89 km³ at a 6% porosity cut off. Two brine samples from an area of the Duperow Formation adjacent to the Kindersley Project collected in 2017 by the Saskatchewan Geological Survey reported lithium grades of 78 mg/L and 70 mg/L lithium, as described further in the Company’s news release dated November 9, 2022, available on the Company’s website at www.lithiumbank.ca and SEDAR at www.sedar.com. These lithium samples have not been verified by LithiumBank and do not provide sufficient information to define a mineral resource and it is uncertain if further exploration will result in the target being delineated as a mineral resource. Mineralization on neighbouring properties is not necessarily indicative of mineralization on any of the properties being acquired by Pristine.
  • The Duperow Formation is an unconfined aquifer that measures up to 300 metres thick within the area of the Company’s mineral permits.

South Property

The South permits will be Pristine’s largest project in Saskatchewan. It is a contiguous land package and the Duperow formation at South has been intersected by numerous oil and gas wells that provide low-cost entry for exploration and production.

• Project size: 134,229 acres, 210 sections of Crown mineral permits
• Development status: Hydrogeological study underway
• Next milestone: NI 43-101 mineral resource estimate
• Reservoir thickness: Up to 160 metres
• Depth to reservoir formation: 2,100 metres
• Contiguous land package
• No H₂S in reservoir
• Neighbouring lithium exploration activities, adjacent to the Company’s South property have reported lithium grades ranging between 98 and 172 mg/L lithium. These lithium samples have not been verified by LithiumBank and do not provide sufficient information to define a mineral resource and it is uncertain if further exploration will result in the target being delineated as a mineral resource. Mineralization on neighbouring properties is not necessarily indicative of mineralization on any of the properties being acquired by Pristine.
• Deep Earth Energy Production has finalized engineering and construction work on a 25 MW geothermal project in the area which can be expanded to > 200 MW

Estevan

The Estevan permits is located in a region that has returned some of the highest lithium grades in Saskatchewan. Brine samples from wells adjacent to Estevan grade between 77 – 259 mg/L lithium. These lithium samples have not been verified by LithiumBank and do not provide sufficient information to define a mineral resource and it is uncertain if further exploration will result in the target being delineated as a mineral resource. Mineralization on neighbouring properties is not necessarily indicative of mineralization on any of the properties being acquired by Pristine. The South and Estevan properties sandwich Prairie Lithium Corporation’s Williston Basin project that recently sold to Arizona Lithium Limited.

• Project size: 90,883 acres, 142 sections of Crown mineral permits
• Development status: Hydrogeological study
• Next milestone: NI 43-101 mineral resource estimate
• Reservoir thickness: Up to 150 metres
• Depth to reservoir formation: 1,700 metres
• Neighbouring lithium exploration activities, adjacent to the Company’s Estevan property have reported lithium grades ranging between 77 and 259 mg/L lithium. These lithium samples have not been verified by LithiumBank and do not provide sufficient information to define a mineral resource and it is uncertain if further exploration will result in the target being delineated as a mineral resource. Mineralization on neighbouring properties is not necessarily indicative of mineralization on any of the properties being acquired by Pristine.

Qualified Person

The scientific and technical disclosure in this news release has been reviewed and approved by Mr. Kevin Piepgrass (Chief Operations Officer, LithiumBank Resources Corp.), who is a Member of the Association of Professional Engineers and Geoscientists of the Province of British Columbia (APEGBC) and the Association of Professional Engineers and Geoscientists of Alberta (APEGA) and is a Qualified Person (QP) for the purposes of NI 43-101. Mr. Piepgrass consents to the inclusion of the data in the form and context in which it appears.

About LithiumBank Resources Corp.

LithiumBank Resources Corp. is a development company focused on lithium-enriched brine projects in Western Canada where low-carbon-impact, rapid DLE technology can be deployed. LithiumBank currently holds over 3.6 million acres of mineral titles, 3.33M acres in Alberta. LithiumBank’s mineral titles are strategically positioned over known reservoirs that provide a unique combination of scale, grade and exceptional flow rates that are necessary for a large-scale direct brine lithium production. LithiumBank is advancing and de-risking several projects in parallel of the Boardwalk Lithium Brine Project.

About Pristine Lithium Corp.

Pristine Lithium Corp. is a lithium brine exploration and development company that has a right to acquire three projects covering 336,000 acres in southern Saskatchewan. Pristine is focused on purposefully advancing its projects from resource delineation through to economic optimization. It will use validated Direct Lithium Extraction technology to develop long life, North American lithium projects that will have limited surface footprints and provide a critical battery metal for the green energy industry.