Sphinx and Osisko Enter JV For Zinc Exploration in Quebec

A letter of agreement announced by Sphinx Resources (TSXV:SFX) has been finalized into a definitive joint venture agreement between Sphinx and Osisko Metals (TSXV:OM) with the objective to explore for zinc in highly prospective areas of the Grenville geological province in southern Quebec.

The terms of the agreement are that each company:

• make initial committed expenditures of C$1,250,000 by each participant over the next five years including C$100,000 each during the first year;
• create a joint management committee to design and oversee the exploration program;
• have Sphinx act as operator of the Grenville zinc project during the exploration period; and
• a provision whereby if a participant’s interest dilutes to 10 percent or less, its interest shall be converted to a 2 percent net smelter return royalty. A participant will only have the right to a dilution royalty as long as its proportionate share of the initial committed expenditures has been paid in full to the joint venture. If at any time, the dilution royalty holder receives a bona fide offer to purchase all or a portion of the dilution royalty and the dilution royalty holder is prepared to accept such offer, the non-diluted party shall have the right of first refusal to purchase the dilution royalty (or, if the offer is for less than all of the dilution royalty, the portion of the dilution royalty to which the offer relates), at the same price and on the same terms and conditions.

Click here to read the full Sphinx Resources (TSXV:SFX) press release.