CDPR Executes Settlement Agreement with Trevali Mining
MONTRÉAL – Cerro de Pasco Resources Inc. (TSX-V: CDPR.V) has recently made a significant move by entering into a settlement agreement with FTI Consulting Canada Inc., acting as the court-appointed monitor for Trevali Mining Corporation. This agreement resolves all claims and counterclaims related to the arbitration concerning the Share Purchase Agreement for Trevali Peru S.A.C. and the Santander Mine.
Settlement Subject to Court Approval
The agreement, known as the Settlement Agreement, is currently awaiting court approval as Trevali continues under creditor protection. The Monitor will seek approval from the Supreme Court of British Columbia, with a hearing scheduled soon.
Background of the Dispute
In recent financial statements, CDPR identified a purchase price payable and contingent consideration stemming from its acquisition of the Santander Mine in 2021. This led to disputes between CDPR and Trevali. An arbitration process initiated by the Monitor in December provides further context to the complex negotiations between these entities on resolving financial obligations.
Highlights of the Settlement
The Settlement establishes a clear and equitable resolution for both parties, which includes:
- Upon court approval, the arbitrator will be instructed to conclude the arbitration and return the CAD 700,000 security for costs to the Monitor.
- CDPR will pay CAD 2,000,000 within 10 days following the arbitrator’s termination order, fully settling all claims from Trevali and the Monitor.
- Mutual release of all claims and counterclaims between the companies.
- Each entity will account for their own legal costs while sharing any outstanding arbitration fees equally.
Financial Impact for CDPR
This settlement is seen as an essential step for CDPR in terms of focusing on its core operations and strategic initiatives. After securing court approval, CDPR plans to remove Trevali-related liabilities from its balance sheet. This includes eliminating a purchase price payable of USD 1,584,164 alongside a contingent consideration payable of USD 2,500,000. Consequently, the financial adjustments represent a total reduction of USD 4,084,164, leading to a favorable impact in CDPR’s financial reports.
Leadership Insights
Guy Goulet, the CEO of CDPR, expressed satisfaction with the resolution, stating, "Reaching this definitive agreement mitigates the remaining risks linked to the historical Trevali transaction. Once court-approved, it allows the company to prioritize its core projects in Peru and streamline its operations for future growth."
About Cerro de Pasco Resources Inc.
Cerro de Pasco Resources is dedicated to developing the El Metalurgista mining concession located in central Peru. This site comprises silver-rich tailings accumulated over years of mining activities. The company's vision emphasizes reprocessing and remediating historical mining waste. This approach not only seeks to unlock value but also advocates for sustainable development practices.
CDPR is steadfast in its commitment to transforming Quiulacocha into a leading example of responsible tailings reprocessing and environmental remediation, showcasing the potential for sustainable value creation in the region.
Further Information
For additional inquiries, Guy Goulet, CEO, can be contacted at:
Telephone: +1 579 476 7000
Mobile: +1 514 294 7000
Email: info@pascoresources.com
Frequently Asked Questions
What did Cerro de Pasco Resources recently announce?
Cerro de Pasco Resources announced a settlement agreement with Trevali Mining to resolve all related claims and counterclaims.
What is the financial impact of this settlement?
The settlement will remove Trevali-related liabilities worth USD 4,084,164 from CDPR’s balance sheet, enhancing its financial standing.
How does this agreement affect CDPR's operations?
This resolution allows CDPR to refocus on their core projects in Peru, streamlining operations without Trevali-related risks.
Who is involved in the settlement agreement?
The agreement involves Cerro de Pasco Resources Inc. and Trevali Mining Corporation, along with FTI Consulting Canada Inc. as the monitor.
What is the main project of Cerro de Pasco Resources?
The company is primarily focused on developing the El Metalurgista mining concession, which features silver-rich tailings and seeks to promote sustainable mining practices.
