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15.1 uses the words "definitive option joint venture agreement" and goes on to say the resulting agreement will "embody all of the terms and conditions of this agreement" and finally it will "replace and supercede this agreement"
Here again we are in the thicket of determining intent based on 10 year old language
And I don't think we can emphasize enough that this agreement was prepared by attorneys and executives working for Teck Cominco, if they disagree with any of the language, they need to refer to their folks
So what would be the reason for wrapping up the Schaft Creek Property Acquisition Agreement with this language?
My thinking would run this way
The Agreement of necessity was open to interpretation since nobody knew what, if anything would materialize along the lines of defining a mine
It was somewhat open ended based on Salazar successfully funding an exploration and then generating results sufficient to meet the predefined BFS conditions that would meet the goals specified
Since the people who drew up this agreement were obviously conversant with all of the provisions contained, they would have been aware of the 120 back in mechanics and would know that the 60 day requirement might preceed the final back in decision
So what was the intent
First for 15.1 to become effective, a successful BFS would need to have been delivered..since that is the event that triggered the clause
So my take is that they anticipated a need to take out the existing agreement, which was riddled with what-ifs concerning potential findings, grades and sizes and narrow the objectives, recognizing whatever might actually have been found and defined in the contemplated BFS in order to normalize the relationship going forward
They also would have been aware of any potentially onerous terms that might apply from underlying agreements that could rise to impact the potential project going forward
The 4 years to production issue comes to mind
I believe they wanted to get these issues pinned down, probably commensurate with or even before the back-in election, if any, was determined
So the parties pre-agreed to agree on resolving these issues, within 60 days of delivery of the BFS
That language is crystal clear, even if the reasons for doing so are not obvious
I would suggest the language in Paragraph 9, Joint Venture Upon Teck Earning an Interest, would have had the parties operating under the original agreement, which was unsuitable for defining the relationship that would need to be in force until Teck earned that interest, only after the substantial expenditures on mine development that would be needed to earn back
There was lack of comfort in proceeding with the potential ambiguities in the original agreement so they elected to redraw it, by agreement
Now we find our folks not thinking there is any need to do this until or unless Teck makes their election
I disagree
We continue to forfeit our negotiating leverage by failing to comply with the agreed terms of our contract
If they do let that one go without acting, the market will destroy us
It would mean we have no oar in this thing whatsoever, IMO
I'd like to invite any who feel unwelcome here to participate in the Copper Fox discussion on Silicon Investor
OK
Guess I need to apologize to all of you
I'll stop bothering you
I misspoke before asserting that Salazar had prepared this agreement
It was in fact Teck Cominco who drew up these terms
...and, not to beat a dead horse, it is instructive to remember that it's purpose was spelled out in the agreement title above
The reason for the agreement was to provide a framework for Salazar, assigned now to CUU, to have a way to earn the title property
The parameters were spelled out
Everything was met, as agreed, and then some
So it puzzles me to have a discussion that we should not expect timely compliance on the part of our counterparty in the agreement...that they wrote....