SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT UNDER TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported): April 14, 1998
Commission File Number: 0-10104
LA TEKO RESOURCES LTD.
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(Exact Name of Registrant as Specified in its Charter)
BRITISH COLUMBIA 87-0483319
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(State or other jurisdiction of (IRS Employer Identification
incorporation or organization) No.)
625 HOWE STREET, SUITE 500
VANCOUVER, B.C. V6C 2T6
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(Address of Principal Executive (Zip Code)
Offices)
Registrant's Telephone Number, including Area Code:
(604) 688-0833
NOT APPLICABLE
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(Former name, former address, and formal fiscal year, if changed since
last report)
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ITEM 5: OTHER EVENTS
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La Teko Resources Ltd. announced on April 8, 1998 that Kinross Gold Corporation
("Kinross") has, subject to due diligence and regulatory approval, agreed to
subscribe for a private placement of 2,000,000 units at $0.85 per unit for gross
proceeds of $1.7 million. Each unit consists of one common share of La Teko and
one common share purchase warrant. Each purchase warrant will entitle Kinross
to purchase one common share of La Teko at a price of $1.05 per share in the
first 12 months after closing and at a price of $1.25 per share in the period
commencing 12 months after closing and ending 24 months after the date of
closing. This private placement is expected to close before the end of April
1998. A finder's fee is payable amounting to 5.9% of the proceeds, plus 133,000
share purchase warrants with the same terms as those described above.
As part of the private placement, La Teko has granted Kinross a right of first
refusal to finance the purchase of Newmont Exploration Limited's ("Newmont")
interests in the True North Project in the Fairbanks Mining District, Alaska, in
the event such interest is offered to La Teko through La Teko's right of first
opportunity as defined under the terms of the joint venture agreement between La
Teko and Newmont. Under the agreement between La Teko and Kinross, if Newmont
elects to sell all or part of its 65% interest in True North (the "Newmont
Interest") and if Kinross elects to finance La Teko to acquire the Newmont
Interest, Kinross will advance the funds necessary for La Teko to acquire the
Newmont Interest by means of a 120-day interest-free loan (the "Loan"), secured
by the Newmont Interest. At the election of either La Teko or Kinross, La Teko
would repay the Loan by conveying the Newmont Interest to Kinross, provided that
La Teko may elect to retain 15/65ths of the Newmont Interest. In such case, La
Teko would repay the remainder of the Loan in cash or, at La Teko's option, by
issuing shares to Kinross at a 10% premium to market.
Management of the company believes that this move is strategic for La Teko.
Although there is no present indication that Newmont is considering the sale of
its interest in the True North joint venture, if Newmont should consider
selling, Kinross, which owns the nearly Fort Knox gold mine, is the logical
buyer. If the 65% interest in True North is acquired from Newmont under the
above scenario, La Teko would have the right to increase its interest in True
North to 50%.
The True North project continues to advance with an aggressive $3.6 million 1998
program under way by its operator, Newmont, with the objective of completing a
pre-feasibility study on the mineral inventory already outlined and to discover
additional oxide gold mineralization. Newmont is presently earning a 65%
interest in True North by paying $6 million to La Teko, now fully paid, and by
spending $21 million on exploration and development of the property, including a
feasibility study. Estimated expenditures by Newmont to the end of 1997 were
approximately $17.5 million, including payments to La Teko.
La Teko also announced, subject to regulatory approval, the issuance of 65,000
common shares to a former employee as part of a severance package.
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SIGNATURES
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Pursuant to the requirements of section 13 or 15(d) of the Securities
Exchange of 1934, as amended, the Registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
LA TEKO RESOURCES LTD.
Dated: April 15, 1998 By /s/ Gerald G. Carlson, President
