No doubt you recall the portion of the conference call where Elmer is being questioned on the JV timing. Elmer maintained the JV discussion would take place after Teck had declared their intent. While this makes sense, the caller reminded Elmer what is stated in the Salazar agreement, namely:
15. Definitive Agreement
15.1 Upon receipt of an executed copy of this Agreement and no later than 60 days after the delivery of a Feasibility Notice, Teck Cominco shall prepare a definitive option joint
venture agreement embodying all of the terms and conditions of this Agreement, and
shall forward it to Salazar for review. It is understood that the parties agree to use their
best efforts to settle in good faith and execute such a definitive agreement which will
replace and supercede this agreement, but until such time, this Agreement shall be the
sole binding agreement between us with respect to the Property.
That was 2002. A summary report report received 2 years later by the Ministry of Energy & Mines says this:
The Schaft Creek mineral deposit is now owned by TeckCominco, a major mining corporation with international operations that include exploration ventures, operating mines, and metallurgical plants. Salazar has an option by agreement dated January 1. 2002 to acquire 100% of TeckCominco's defined 'Direct Holding', which is a 70% direct participating interest in the Schaft Creek property, by incurring $5,000,000 in expenditures as defined on or before December 31, 2006 and aggregate expenditures of $15,000.000 on or before December 31, 2011, and TeckCominco's defined 'Indirect Holding', an indirect 23.4% carried interest through its 78 shareholding in Liard Copper Mines Ltd. who hold a 30% carried interest in the property, by incurring the above described $5,000,000 in expenditures and completing a positive bankable feasibility study, as defined, and delivering a Feasibility Notice to TeckCominco.
The option agreement has a time-limited back-in right exercisable by TeckCominco within 120 days of the delivery of the positive feasibility study. If the back-in right is not exercised, Salazar shall grant TeckCominco a 1% net smelter royalty or, ifSalazar has assigned the option agreement to a public company whose shares are listed on a recognized stock exchange, shares of that company having a value of $1,000,000.
The back-in right. if exercised, would enable TeckCominco to acquire, variously, 20%, 40%, or 75% interest in the property whereupon Salazar (or its assignee) would form with TeckCominco a joint venture in which each owner would own the property in proportion to their respective interests. The option agreement includes provisions for joint management and for dilution of interests in proportion to expenditures, including reversion of either party to a defined net profits royalty if that party's interest is diluted below a 20 interest in the joint venture.
http://aris.empr.gov.bc.ca/ArisReports/27305A.PDF
Hoping none of this matters in a day or two. Cheers.
