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Foran Mining (TSXV:FOM) announced it has come to an agreement to end back-in rights at its Bigstone, Balsam and Hanson properties with Teck Resources. As a result, the company will issue one million common shares and one million warrants of Foran to Teck.
According to the press release:
Under the terms of the Agreement, in consideration for the extinguishment of Teck’s existing back-in rights on the Properties, Foran will issue to Teck 1,000,000 common shares of Foran (“Shares”) and 1,000,000 warrants (“Warrants”). The Shares and Warrants, combined, represent 2.1% of Foran’s share capital on a fully diluted basis. Each Warrant will be exercisable for one share at a price of $0.24 per share for a term of 24 months from the date of signing of the Agreement. Both the Shares and Warrants are subject to a hold period no longer than four months from the date of issuance. The Agreement is subject to approval by the TSX Venture Exchange. If such approval is not obtained by October 22, 2014 Teck may, at its option, terminate the Agreement.
In addition, in the event that the Company sells or options any of the Properties prior to September 30, 2018 (a “Future Sale”), Foran will pay Teck in-kind an amount equivalent to 20% of the proceeds for any Future Sale occurring prior to September 30, 2016 and 10% of the proceeds for any Future Sale occurring after September 30, 2016 and prior to September 30, 2018.
Patrick Soares, President and CEO, said:
Extinguishing the back-in rights on the Properties simplifies the ownership structure of Foran’s landholdings surrounding the McIlvenna Bay property. It gives the Company the freedom to fully explore or joint venture the Properties, as well as adding a well-respected major mining company to Foran’s strong shareholder base.
Click here to read the Foran Mining Corporation (TSXV:FOM) press release
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