|Neo Material Technologies Inc. (TSX: NEM) (the “Company” or “Neo”) announced nearly that it has signed a Memorandum of Understanding (“MoU”) with Mitsubishi Corporation (“Mitsubishi”). This MoU represents the establishment of a strategic partnership between Neo and Mitsubishi for the identification, development and
commercialization of rare earth resource opportunities outside of China.
Under the terms of the agreement, Mitsubishi will fund up to US$2.5 million of all costs associated with Neo’s development of the heavy rare earth resource at the Pitinga tin mine in Brazil owned and operated by Mineracao Taboca (“Taboca”). As part of the agreement, Neo is also committed to use its reasonable best efforts to include Mitsubishi’s participation in the commercial phase of the Pitinga project with Taboca and to allocate a portion of all mixed rare earth concentrate produced from Pitinga to Mitsubishi for its own use.
In the event that Neo decides to construct and operate a rare earth processing plant anywhere outside the People’s Republic of China, Mitsubishi has committed to a minimum participation of 20 percent in such new facilities. In return, Mitsubishi will have the right to purchase no less than 20 percent of the annual output of separated rare earths from such plants.
In addition to Neo’s Pitinga project, Mitsubishi and Neo will continue to collaborate on the identification and development of rare earth resources around the world, which fit their criteria of by-product economics and heavy rare earth mineralization.