Lithium Chile Provides Shareholder Update Following Investment Canada Act Notice

Lithium Chile Inc. (LITH) has received a notice under subsection 25.2(1) of the Investment Canada Act (ICA) regarding the proposed sale of Argentum Lithium S.A. to China Union Holdings Ltd. The company is challenging the jurisdictional basis of the review, maintaining that the transaction does not constitute an investment in a Canadian business. Lithium Chile argues that Argentum Lithium S.A. has no operations, assets, or employees in Canada, and therefore falls outside the scope of the ICA.

The proposed transaction involves the sale of all outstanding shares of Argentum Lithium S.A. Argentum holds a 62.2% interest in ARLI S.A., which owns and operates the Arizaro mineral project in Salta Province, Argentina. The company announced the transaction on December 22, 2025, and submitted a proactive notification to Innovation, Science and Economic Development Canada (ISED) on January 7, 2026. However, the notice under the ICA was not received until August 17, 2026, more than seven months after the initial notification.

Lithium Chile cites several reasons for its position that the sale is not subject to ICA jurisdiction. Specifically, the company states that: * Argentum does not carry on operations in Canada. * Argentum does not maintain a place of operations in Canada. * Argentum does not employ individuals in Canada. * Argentum does not own assets in Canada used in operations.

The regulatory uncertainty poses potential risks to the company’s strategic plans, as it may delay the reinvestment of transaction proceeds into Lithium Chile’s other high-potential projects in Chile. Despite these challenges, both parties remain committed to closing the transaction. Lithium Chile is currently evaluating alternative transaction structures to comply with applicable laws while achieving the objective of monetizing the Arizaro Project.

Steve Cochrane, President and CEO of Lithium Chile, emphasized the continued commitment from both sides. “Our message to shareholders is straightforward: China Union remains committed to this Transaction, Lithium Chile remains committed to this Transaction, and we are working together to determine the most effective path forward,” Cochrane said.

He also addressed the delay in regulatory feedback. “After receiving no response for more than seven months, we are understandably concerned by the timing of this notice and the uncertainty it creates for our shareholders. We intend to vigorously defend our position while at the same time evaluating every lawful alternative available to us to complete the transaction,” Cochrane added.