1% NSR Foy/Bowell Townships, Ontario
United Reef Limited sold its 50% interest in 47-patented claims (situated on the Foy offset dike) in Foy and Bowell Townships to Falconbridge Limited (now Xstrata) in 1998. The remaining 50% interest in the claims was held by Canhorn Chemical Corporation and was sold to Falconbridge on identical terms to the Company's interest. The Company believes that Falconbridge subsequently joint-ventured this property with INCO (now CVRD) on a 50/50% basis. Falconbridge optioned its 50% interest in the property to Aurora Platinum Corp., who subsequently earned 70% of Falconbridge 's 50% interest (i.e., 35%). Effective July 2005, Aurora Platinum became a wholly-owned subsidiary of FNX Mining Company Inc. FNX is continuing to explore the property.
United Reef and Canhorn collectively retained a 1% NSR (0.5% to each of United Reef and Canhorn) for any ores or minerals recovered from the claims. The royalty is capped at a maximum of $750,000. Falconbridge may repurchase the royalty at any time by payment of $250,000 to each of United Reef and Canhorn. In June of 2000, United Reef acquired all of Canhorn's residual interest in the Falconbridge agreement and the royalty. United Reef now holds the entire 1% NSR.