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EXHIBIT 10.24
COOPERATION AGREEMENT
FOR
MINERAL EXPLORATION AND DEVELOPMENT
BETWEEN
MINCO MINING & METALS CORPORATION
AND
BAIYIN NON-FERROUS METALS COMPANY
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COOPERATION AGREEMENT
FOR MINERAL EXPLORATION AND DEVELOPMENT
THIS AGREEMENT is executed on the 17th day of November 1997, in Baiyin City, on
Gansu Province, China.
BETWEEN:
BAIYIN NON-FERROUS METALS COMPANY
a corporation incorporated under the laws of the People's Republic of
China (Referred to herein as "BAIYIN")
REGISTERED ADDRESS: Baiyin City, Gansu Province, China
AUTHORIZED REPRESENTATIVE: Xx. Xxxxxxxx Xxx
The Deputy General Manager of BAIYIN
PHONE: (0000) 0000-000 FAX: (0000) 0000-000
AND:
MINCO MINING & METALS CORPORATION
a public corporation incorporated
under the laws of British Columbia
(Referred to herein as "MINCO")
REGISTERED ADDRESS: 1200, 000 Xxxxxxxxx Xx.
Xxxxxxxxx, XX Xxxxxx X0X 0X0
AUTHORIZED REPRESENTATIVE: Xx. Xxx X. Xxx
The President of MINCO
PHONE: (000) 000-0000 FAX: (000) 000-0000
(Collectively, the "PARTIES", or individually a "PARTY")
WHEREAS BAIYIN and MINCO have had friendly discussions and negotiations
concerning a joint venture for mineral exploration and exploitation of the
Baiyin region, Gansu Province, China.
NOW THEREFORE, in consideration of the premises set out above, and the mutual
promises set out below, the Parties have agreed and do hereby agree as follows:
1.0- ESTABLISHMENT OF THE JOINT VENTURE
1. The Parties agree to form a co-operative joint venture (the "JOINT VENTURE")
constituted as a separate legal person. The objectives of the Joint Venture
are to jointly explore, develop and
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exploit mineral resources (excluding those mineral commodities on which the
foreign participation is prohibited by the Chinese laws) in the Baiyin
region of Gansu Province, China using an integrated mining company model
which combines exploration, development, and production.
2. The business scope of the Joint Venture includes mineral exploration,
development, exploitation, processing and marketing of mineral products.
3. Both Parties agree that the term of the Joint Venture is thirty (30) years
such period to be extendible upon mutual agreement between the Parties if
the circumstances so warrant.
2.0- AREA FOR THE JOINT VENTURE
The Parties agree that the property (the "PROPERTY") for the Joint Venture is
the area defined in Schedule A.
3.0- CONTRIBUTION TO THE JOINT VENTURE
3.1 BAIYIN
In consideration for its equity participation, BAIYIN shall contribute to the
Joint Venture the following assets. (1) the Property; (2) mineral rights on the
Property (including the discovery right, exploration permits, and privilege
mining rights); (3) the data and results which has been collected or created to
date on the Property (collectively referred to herein as the "BAIYIN'S
CONTRIBUTIONS").
3.2 MINCO
In consideration for its equity participation, MINCO shall contribute to the
Joint Venture the following assets: (1) certain advanced equipment; and (2)
capital.
4.0- EQUITY INTERESTS
4.1 The Parties agree that after the Joint Venture has been established,
BAIYIN shall transfer the following assets to the Joint Venture: (1) the
Property; (2) mineral rights on the Property (including the discovery
right, exploration permits, and privilege mining rights); (3) the data
and results which has been collected or created to date on the Property
as its contribution to the Joint Venture. BAYIN shall have twenty (20)
percent equity interests after the Baiyin's Contribution has been made
to the Joint Venture.
4.2 After the execution of this Cooperation Agreement, MINCO has right to
contribute exploration expenditures (the "MINCO'S CONTRIBUTION")
phase-by-phase and stage-by-stage to explore ONE mineral deposit (the
"DEPOSIT DISCOVERED AND EXPLORED") on the Property. The geological data
from the Deposit Discovered and Explored shall be sufficient for the
requirements of a feasibility study. MINCO shall have eighty (80)
percent of the equity interest in the Joint Venture after the Minco's
Contribution has been made to the Joint Venture.
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4.3 Thereafter, the capital requirements of the Joint Venture, including the
feasibility study and development capital expenditures for the Deposit
Discovered and Explored, and other expenditures, shall be contributed
eighty (80) percent by MINCO and twenty (20) percent by BAIYIN. If one
Party can not or is not willing to make the capital contribution, its
equity interests in the Joint Venture shall be diluted in accordance
with a standard internationally used dilution formula.
5.0- OPERATION AND MANAGEMENT OF THE JOINT VENTURE
5.1 The Joint Venture shall be managed and operated in accordance with the
Law of the PRC on Sino-Foreign Co-operative Joint Venture Enterprises,
the Company Law of the People's Republic of China, and other relevant
Chinese laws and regulations as well as sound internationally accepted
policies, standards and practices.
5.2 The Joint Venture will be managed by the board of directors, which will
possess the highest authority over the operation, and management of the
Joint Venture. The board of directors of the Joint Venture shall be
comprised of seven (7) directors, three (3) of which shall be appointed
by BAIYIN and four (4) of which shall be appointed by MINCO.
6.0- NET PROFIT DISTRIBUTION
After each of the Parties recovers its respective investment to the Joint
Venture, the net profit of the Joint Venture shall be distributed to the Parties
in proportion to their respective relative beneficial interests in the Joint
Venture.
7.0- TECHNICAL OPERATION AND MANAGEMENT OF THE PROJECT
7.1. The board of the directors of the Joint Venture shall undertake mineral
exploration, development, exploitation, and processing on the Property
in accordance with Chinese laws and regulations as well as sound
internationally accepted standards and practices. The Project will be
carried out phase-by-phase and stage-by-stage in comply with the program
and budget approved by the board of directors from time to time.
7.2 The Joint Venture shall have right to develop any commercial deposit
discovered on the Property through the exploration carried out by the
Joint Venture.
7.3 The Joint Venture shall give BAIYIN privilege priority to contract the
exploration works on the Property provided that BAIYIN can guarantee the
time and quality of the work and a reasonable and fair market rate of
the work.
8.0- COOPERATION PROCEDURE
In order to conduct the Project as soon as possible, the Parties agree to
undertake the activities as set out below:
1. After executing this Agreement, BAIYIN shall provide MINCO with brief
geological data for its Board of Directors to further assess the exploration
potential of the Property, including regional
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geological maps, property geological maps, geochemical and geophysical
anomaly maps, representative cross-sections, reserve calculation maps, and
brief geological report of the Property.
2. After executing this Agreement, BAYIN shall obtain approval from the
appropriate Chinese government authorities to allow the Parties to enter the
Joint Venture Contract and to form the Joint Venture (the "GOVERNMENT
APPROVAL"). BAIYIN shall exercise its best efforts to seek the Government
Approval as soon as possible. MINCO shall provide to BAIYIN reasonable
assistance.
3. After executing this Agreement, the Parties shall negotiate a full and final
joint venture contract (the "JOINT VENTURE CONTRACT") in good faith to set
up all the details for the Joint Venture.
4. In order to speed up the project, the Parties agree to conduct some
preliminary field works on the Property stage-by-stage and phase-by-phase.
Both Parties shall study and analyze the existing geological data on the
Property in a timely fashion to establish a mineralization model and design
an overall exploration program. BAIYIN shall provide MINCO's staffs
reasonable logistic support.
5. Upon establishment of the Joint Venture, the Parties shall conduct the
Project pursuant to the term of the Joint Venture Contract.
9.0- CONFIDENTIALITY OBLIGATIONS
1. This Agreement and all the documents signed by the Parties in the future are
the assets of the Parties and shall not be disclosed to any third party
except the government and regulatory authorities.
2. MINCO agrees to preserve the confidentiality of all information provided by
BAIYIN. MINCO can disclose such information to regulatory authorities
including, without limitation, Canadian government bodies, securities
commissions and stock exchanges, to meet the disclosure requirement of such
regulatory authorities. However, such disclosure shall not hurt the
interests of BAIYIN.
3. MINCO agrees to return to BAIYIN all the information supplied by BAIYIN if
the project is not carried out for whatever reasons.
10.0- GENERAL
1. After executing this Agreement, both Parties shall report this joint venture
project to its respective authorities in a timely fashion to obtain the
confirmation of the project from those authorities.
2. This Agreement is written in duplicate in both Chinese and English, with
both texts having equal authority.
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3. This Agreement, and any notices or other documents permitted or required by
it, may be executed in counterparts, including copies which have been
executed and then delivered by facsimile transmission. A copy which has been
executed in counterparts and transmitted by facsimile transmission shall
have equal authority as an originally executed copy.
4. If one of the Parties wishes to terminate this Agreement, it must inform the
other Party in writing. This Cooperation Agreement can only be terminated
upon mutual agreement.
5. There are four copies of this Agreement. Each Party has two copies.
IN WITNESS WHEREOF the Parties have duly executed this Agreement as evidenced by
each signature below.
BAIYIN NON-FERROUS METALS COMPANY
LEGAL REPRESENTATIVE:
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Jiangshen Wu, General Manager
AUTHORIZED REPRESENTATIVE:
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Shichang Ren, Deputy General Manager
MINCO MINING AND METALS CORPORATION
LEGAL REPRESENTATIVE:
/s/ XXXXX XXXXXXXX
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Xxxxx Xxxxxxxx, Chairman of the Board
AUTHORIZED REPRESENTATIVE:
/s/ XXX X. XXX
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Xxx X. Xxx, President and CEO
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SCHEDULE A
This schedule is attached to and forms part of the Cooperation Agreement for
Mineral Exploration and Development between BAIYIN NON-FERROUS COMPANY and MINCO
MINING & METALS CORPORATION executed on November 17, 1997.
The Property is the Baiyin region of Gansu Province, China, including the dip
and west-strike extension of the Xiaotieshan mine, but excluding the areas which
already have geological exploration reports and which have been previously
explored by BAIYIN during production.
The coordinates of the Property are presented in the map attached.
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