I'm trying to make sense of the depth of commitment between TAM and MLX.
According to the announcement, release date 09/02/15 Metals X to Acquire 75% of Central Tanami Project; MLX and TAM entered aBinding Heads of Agreement. This was taken from the opening sentence.
''The Board of Metals X Limited (Metals X) is pleased to advise that it has entered into a binding Heads of Agreement with Tanami Gold NL (TAM) to progressively acquire a 75% interest in the Central Tanami Project (CTP).''
'Heads Of Agreement'
A non-binding document outlining the main issues relevant to a tentative
partnership agreement. Heads of agreement represents the first step on the path to a full legally binding agreement or contract, and serves as a guideline for the roles and responsibilities of the parties involved in a potential partnership before any binding documents are drawn up.
BREAKING DOWN 'Heads Of Agreement'
As a Heads of Agreement document
is only meant to serve as a guideline, it may not be comprehensive enough to cover all the bases relevant to a binding contract. While the parties involved may find broad agreement on the topics covered in a Heads of Agreement document
, the devil may be in the details. In other words, the minutiae that must perforce be spelt out in a binding partnership agreement or contract may not be to the liking of all the parties involved in the partnership, which could derail their efforts to work together.
Read more: Heads Of Agreement Definition | Investopedia http://www.investopedia.com/terms/h/headsofagreement.asp#ixzz42ZXNOZgI
From what I understand it seems to me MLX is looking more into the Heads of agreement than they should. I am not sure what makes this 'Binding'. It is mentioned by TAM that both heads of agreements with NST and MLX are binding. But if that is the case then how is it Heads of agreement? Well as highlighted earlier, the devil may be in the details. The following was taken from the Feb 26 2015 announcement.
''The Board of Tanami Gold NL (Tanami) refers to the binding conditional joint venture heads
of agreement between Tanami and Metals X Limited (Metals X) in relation to Tanami's
Central Tanami Project (CTP) announced on 9 February 2015 (the Metals X HoA).
The Tanami Board has since received an unsolicited alternative proposal from Northern Star
Resources Limited (Northern Star) in relation to the CTP which the Board, after careful
consideration, is of the opinion is superior to the transaction contemplated by the Metals X
HoA (the Metals X Transaction) and that the Tanami Board intends, subject to there being
no superior proposals, to vote in favour of the NST Transaction and against the Metals X
Transaction, in relation to any shares owned or controlled by them.''
So if the condition of ''There being no superior proposals'' is what bound TAM and MLX together, Then ladies and Gentlemen TAM had the right to pursue NST instead of MLX.
I'm no Lawyer but I can read. To my comprehension I think TAM has a better than 50% chance of getting out of this mess.
What does everyone else think?
