Niblack Mining Acquires Option to Remove Back-in Right on Niblack Property
Thursday August 31, 9:00 am ET
VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Aug. 31, 2006) - Niblack Mining Corporation ('Niblack') (TSX VENTURE:NIB - News; www.niblackmining.com) is pleased to announce that an option agreement (the "Agreement") has been signed with Teck Cominco Limited and its subsidiary Teck Resources Inc. (collectively "Teck Cominco") to wind up an Agreement dated February 27, 1996 pursuant to which Teck Cominco holds a 51% back-in right and other rights on the copper-zinc-gold-silver Niblack volcanogenic massive sulphide ("VMS") property in southeast Alaska.
In order to wind up the Agreement and the Teck Cominco back-in right, the Company will issue 750,000 common shares and 1,250,000 share purchase warrants over an eighteen month period as follows:
- 250,000 common shares and 400,000 warrants on TSX Venture Exchange approval;
- 250,000 common shares and 400,000 warrants on or before March 31, 2007; and
- 250,000 common shares and 450,000 warrants on or before December 31, 2007.
Each warrant is exercisable into one common share for a two year period from the date of issuance. The first tranche of warrants are exercisable at $1.00 per share and the second and third tranches are exercisable at prices equal to 125% of the average trading price of the Company for twenty days that precede each warrant issuance.
If the Niblack property is placed into commercial production, the Company will also make an additional $1,000,000 payment in cash or stock, at the discretion of the Company, to Teck Cominco.
If Teck Cominco wishes to sell any issued shares or warrant shares under the Agreement, Teck Cominco will provide Niblack with a limited opportunity to arrange a buyer for the shares on behalf of Teck Cominco.
In certain cases where Niblack wishes to sell or grant rights to a third party before the above obligations to Teck Cominco are satisfied, Teck Cominco is entitled to early payment rights.
Paddy Nicol, President of Niblack Mining, states, "By signing this agreement, we now have greater control over future development of the Niblack property, and have increased our options for corporate opportunity. We have been fortunate to have had Teck Cominco as our partner we would like to thank them for their technical input and assistance over the year
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