Major General Resources Ltd -
Earn-back agreement for Victoria Island diamond project
Major General Resources Ltd
MGJ
Shares issued 33186119
1998-02-02 close $0.39
Tuesday Feb 3 1998
Also Ascot Resources Ltd (AOT)
Mr Glenn Shevchenko reports
Major General has entered into a letter of intent for an earn-back agreement with Ascot Resources for the
Victoria Island diamond property, NWT.
Ownership in the property stands at 75% Ascot and 25% Major General. Subject to the following
conditions, Major General will earn back to a 50% interest in the property by having $1 million in
exploration spent on its behalf by December 31 2000.
1. Major General becomes operator and prepares a full technical package of information in order to present it to a potential third party;
2. Once the party is identified then Major General negotiates an option/joint venture agreement with the party which will require joint approval by Major General and Ascot;
3. Under a negotiated option/joint venture agreement, the part will spend exploration dollars on the property. Furthermore, the initial expenditures by the party will be on Major General's behalf until the $1 million requirement under the earn-back agreement has been satisfied.
4. Should the party, on behalf of Major General, incur only a portion of the required $1 million expenditure by December 31 2000, then Major General will have earned back the appropriate interest on a pro rata basis.
5. Any option payments made by the party during the option period will be shared 50/50 between Ascot and Major General.
6. In addition to the exploration dollars spent by the party on behalf of Major General, all costs incurred by Major General regarding the exploration, maintenance and farm-out of the property, including the data compilation, technical report preparation and legal costs, shall be considered as exploration expenditures for the purposes of the earn-back agreement.
In 1994 and 1995, Ascot and Major General completed extensive till sampling and aerial magnetic
surveys on this 2 million acre property. The work was successful in locating a highly rated target area
which hosts several samples containing very high indicator mineral counts as well as two significant
magnetic anomalies up-ice from the anomalous sample sites. The property has additional diamond
potential as several other indicator mineral and aeromagnetic anomalies exist on the jointly owned
permits. |
