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FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of May 2006
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Commission File Number 001-32748
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CORRIENTE RESOURCES INC.
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(Translation of registrant's name into English)
520 - 800 West Pender Street, Vancouver, British Columbia, CANADA V6C 2V6
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(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file
annual reports under cover of Form 20-F or Form 40-F.
Form 20-F Form 40-F X
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Indicate by check mark if the registrant is submitting the Form 6-K in
paper as permitted by Regulation S-T Rule 101(b)(1): ______
Indicate by check mark if the registrant is submitting the Form 6-K in
paper as permitted by Regulation S-T Rule 101(b)(7): ______
Indicate by check mark whether by furnishing the information contained
in this Form, the registrant is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes No X
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If "Yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2(b): 82-_______________
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DOCUMENTS INCLUDED AS PART OF THIS REPORT
Document
--------
1. News release, dated February 14, 2006, related to its application to
list its shares on AMEX.
2. News release, dated March 15, 2006, related to its awarding of
engineering and procurement work to SNC-Lavalin.
3. News release, dated March 22, 2006, related to its energy supply
agreement at Mirador.
4. Certificate of Annual Filings (CFO), dated March 31, 2006.
5. Certification of Annual Filings (CEO), dated March 31, 2006.
6. News release, dated April 5, 2006, related to its commencement of
trading on AMEX.
7. Management's Discussion and Analysis of Financial Condition and Results
of Operations for the year ended December 31, 2005 (Amended).
8. Notice of annual general meeting, dated April 6, 2006.
9. Information circular, dated April 6, 2006
10. Form of proxy.
11. Shareholder Request for Annual Financial Statements and MD&A And/Or
Interim Financial Statements and MD&A.
12. News release, dated May 4, 2006, related to the approval of the
environmental impact assessment for the Mirador project.
DOCUMENT 1
Disclosure statements as required
by National Instrument 43-101 are
available at our website
www.corriente.com
[CORRIENTE RESOURCES INC. GRAPHIC OMITTED]
"NEWS RELEASE"
For Immediate Release February 14, 2006
---------------------
Trading Symbol: CTQ-TSX
CORRIENTE RESOURCES INC. APPLIES TO LIST ITS COMMON SHARES
ON THE AMERICAN STOCK EXCHANGE
Corriente announces that it has filed an application to list its common shares
on the American Stock Exchange in the United States. The company also announces
that it has filed a Registration Statement on Form 40-F with the United States
Securities and Exchange Commission, as required to facilitate this application.
The company has been advised that the application review process can take up to
approximately 4 weeks.
Corriente's Senior Vice-President, Dan Carriere commented, "We are committed to
expanding awareness of our company within the global investment community over
the coming years as we continue to develop our copper operations in the
Corriente Copper Belt. We view a listing of our common shares on the American
Stock Exchange as an important step towards achieving this goal."
Corriente is moving towards construction of a starter operation at its Mirador
copper-gold operation. Mirador is one of the few new, sizeable copper projects
available for near-term production. Beyond the Mirador project, Corriente has a
unique pipeline of copper resource development projects which could keep
production rates in the Corriente Copper Belt district growing for over a
decade. Corriente controls a 100% interest in over 50,000 hectares located
within the Corriente Copper Belt, Ecuador. The Belt currently contains three
copper and copper-gold porphyry deposits, Mirador, Panantza and San Carlos.
Additional exploration activities will be ongoing, as six additional copper and
copper-gold exploration targets have been identified in the Corriente Copper
Belt to date.
"Ken Shannon"
Kenneth R. Shannon, P. Geo.
Chairman and Chief Executive Officer
The Toronto Stock Exchange has neither approved nor disapproved of the
information contained herein.
For further information please contact Mr. Dan Carriere, Senior
Vice-President at (604) 687-0449 or see our web site at www.corriente.com
Certain statements contained in this News Release constitute forward-looking
statements. Such forward-looking statements involve a number of known and
unknown risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the company's plans to materially
differ from any future results, performance or achievements expressed or
implied by such forward-looking statements. Readers are cautioned not to place
undue reliance on these forward-looking statements, which speak only as of the
date the statements were made, and readers are advised to consider such
forward-looking statements in light of the risks set forth in the company's
continuous disclosure filings as found at www.sedar.com .
520 - 800 West Pender Street, Vancouver, B.C. V6E 2V6
T (604) 687-0449 F (604) 687-0827 Email copper@corriente.com
DOCUMENT 2
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[CORRIENTE RESOURCES INC. | Disclosure statements as required |
GRAPHIC OMITTED] | by National Instrument 43-101 are |
| available at our website |
| www.corriente.com |
-----------------------------------
"NEWS RELEASE"
For Immediate Release March 15, 2006
---------------------
Trading Symbol: CTQ-TSX
CORRIENTE AWARDS ENGINEERING AND PROCUREMENT WORK TO
SNC-LAVALIN FOR MIRADOR COPPER MINE
Corriente Resources Inc. is pleased to announce that its wholly owned
subsidiary, EcuaCorriente S.A. has signed a Letter of Award with SNC-Lavalin
Chile S.A., a member of the SNC-Lavalin Group of Companies of Canada, for full
Engineering and Procurement Services for the start-up and expansion of the
Mirador copper-gold mine in southeast Ecuador.
Corriente's President Tom Milner commented, "A challenge facing the mining
industry globally is the shortage of engineering services available to do
detailed engineering and construction of new operations to meet the growing
demand for metals. We are pleased to secure the services of SNC-Lavalin Chile's
experienced engineering group, who have extensive mine design and construction
experience in South America. This is an important step towards our start-up of
operations at Mirador. Corriente's copper resources and team of experienced
senior mine operating personnel, forms the foundation for Corriente to build a
strong mid-tier copper producer with a significant growth potential."
On November 17, 2005, Corriente announced the results of optimization study work
done by Mine Development Associates of Reno, NV (MDA), which established a mine
life of 38 years for the 25,000 tonnes per day starter project.
Using the optimization study results, Management established the viability of
expanding the starter project to 50,000 tpd with construction of the expansion
underway in year 5 of operations, and reported in the company's November 17,
2005 news release that the overall Mirador mine plan was projected to generate a
24% pre-tax IRR and a NPV of $US 349 Million at an 8% discount rate using a
long-term copper price of $US 1.10/lb.
Engineering and pre-construction work remains on schedule at Mirador, with
approval of the company's Environmental Impact Assessment expected in the second
quarter of 2006.
Mirador is one of the few new, sizeable copper projects available for near-term
production. Beyond the Mirador project, Corriente has a unique pipeline of
copper resource development projects which will support increased copper
production in the Corriente Copper Belt District. Corriente controls a 100%
interest in over 50,000 hectares located within the Corriente Copper Belt. The
Belt currently contains three copper and copper-gold porphyry deposits, Mirador,
Panantza and San Carlos. Corriente has recently discovered a fourth deposit in
the district, Mirador Norte (3 kms from Mirador), where resource delineation
drilling is currently ongoing. Additional exploration activities will be
ongoing, as six additional copper and copper-gold exploration targets have been
identified in the Corriente Copper Belt to date.
SNC-Lavalin (TSX: SNC) is one of the leading groups of engineering and
construction companies in the world, a global leader in the ownership of
infrastructure, and in operations and maintenance services. The SNC-Lavalin
companies have offices across Canada and in 30 other countries around the world
and are currently working in some 100 countries. www.snclavalin.com
"Tom Milner"
Thomas E. Milner, P. Eng.
President
The Toronto Stock Exchange has neither approved nor disapproved of the
information contained herein.
For further information please contact Mr. Dan Carriere, Senior Vice-President
at (604) 687-0449 or see our web site at www.corriente.com
Certain statements contained in this News Release constitute forward-looking
statements. Such forward-looking statements involve a number of known and
unknown risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the company's plans to materially differ
from any future results, performance or achievements expressed or implied by
such forward-looking statements. Readers are cautioned not to place undue
reliance on these forward-looking statements, which speak only as of the date
the statements were made, and readers are advised to consider such
forward-looking statements in light of the risks set forth in the company's
continuous disclosure filings as found at www.sedar.com.
520 - 800 West Pender Street, Vancouver, B.C. V6E 2V6
T (604) 687-0449 F (604) 687-0827 Email copper@corriente.com
DOCUMENT 3
Disclosure statements as required
by National Instrument 43-101 are
available at our website
www.corriente.com
[CORRIENTE RESOURCES INC. GRAPHIC OMITTED]
"NEWS RELEASE"
For Immediate Release March 22, 2006
---------------------
Trading Symbol: CTQ-TSX
Terms Agreed For Energy Supply Agreement at Mirador, Ecuador
o Corriente Copper Belt has access to low cost green energy
Corriente Resources has signed a Letter of Intent (LOI) with Hidroabanico S.A.
to supply the 28.5 MW power needs of proposed mining operations at the Mirador
copper-gold project. The terms outlined in the LOI propose a 10 year Power
Purchase Agreement (PPA) with a proposed rate of $0.05/kWh. The Hidroabanico
facility has already been completed to a 15 MW stage and an expansion is under
way to the final size of 37.5 MW, with completion slated for December 2006. The
Hidroabanico facility is a run-of-river design and provides "green" energy that
qualifies for the carbon credit program. The energy will be delivered through a
dedicated line to the mine, which will cost in the order of $US10 Million to
construct and will be included in the capital cost estimate for Mirador. As
part of the LOI, Hidroabanico will have the first right of opportunity to
provide energy needs for the planned 25,000 tpd to 50,000 tpd expansion at
Mirador. A due diligence review is presently underway at the site, which will
be followed by final negotiation of the PPA.
Since 1999, Ecuador has had a competitive wholesale electrical market operated
by Centro Nacional de Control de Energia (CENACE). The country's energy needs
are currently supplied by a combination of hydro and thermal suppliers, but
most new energy sources in Ecuador are hydro (such as the 230 MW San Francisco
Project currently under construction south of Quito). As part of the government
plan to grow energy supplies in Ecuador, a total of 146 new hydro projects over
1 MW have been identified which will provide potential new capacity of over
20,000 MW to the Ecuador energy market.
As the agreement with Hidroabanico will meet the energy needs at Mirador,
Corriente is planning no further development work at the Sabanilla run-of-river
project. Options for moving the Sabanilla project forward with local operators
as a spot power producer are under review.
Corriente is moving towards construction of a starter operation at its Mirador
copper-gold operation. Mirador is one of the few new, sizeable copper projects
available for near-term production. Beyond the Mirador project, Corriente has a
unique pipeline of copper resource development projects which could keep
production rates in the Corriente Copper Belt district growing for over a
decade. Corriente controls a 100% interest in over 50,000 hectares located
within the Corriente Copper Belt, Ecuador. The Belt currently contains three
copper and copper-gold porphyry deposits, Mirador, Panantza and San Carlos.
Additional exploration activities will be ongoing, as six additional copper and
copper-gold exploration targets have been identified in the Corriente Copper
Belt to date.
520 - 800 West Pender Street, Vancouver, B.C. V6E 2V6
T (604) 687-0449 F (604) 687-0827 Email copper@corriente.com
[CORRIENTE RESOURCES INC. GRAPHIC OMITTED]
"Ken Shannon"
Kenneth R. Shannon, P. Geo.
Chairman and Chief Executive Officer
The Toronto Stock Exchange has neither approved nor disapproved of the
information contained herein.
For further information please contact Mr. Dan Carriere, Senior Vice-President
at (604) 687-0449 or see our web site at www.corriente.com
Certain statements contained in this News Release constitute forward-looking
statements. Such forward-looking statements involve a number of known and
unknown risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the company's plans to materially
differ from any future results, performance or achievements expressed or
implied by such forward-looking statements. Readers are cautioned not to place
undue reliance on these forward-looking statements, which speak only as of the
date the statements were made, and readers are advised to consider such
forward-looking statements in light of the risks set forth in the company's
continuous disclosure filings as found at www.sedar.com .
520 - 800 West Pender Street, Vancouver, B.C. V6E 2V6
T (604) 687-0449 F (604) 687-0827 Email copper@corriente.com
DOCUMENT 4
CERTIFICATION OF FINANCIAL INFORMATION
FOR
CORRIENTE RESOURCES INC.
I, Darryl F. Jones, Chief Financial Officer of Corriente Resources Inc., hereby
certify and confirm that:
o I have reviewed the company's Annual Report, which includes the
company's audited Consolidated Financial Statements and Management's
Discussion and Analysis, for the year ended December 31, 2005;
o based on my knowledge, the report does not contain any untrue statement
of a material fact or omit to state a material fact necessary in order
to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period
covered by the report;
o based on my knowledge, the financial statements, and other financial
information included in the report, fairly present in all material
respects the financial condition, results of operations and cash flows
of the company as of, and for, the periods presented in the report;
o I have disclosed to the issuer's auditors and to the audit committee of
the board of directors (or persons fulfilling the equivalent function):
o all significant deficiencies in the design or operation of internal
controls (a pre-existing term relating to internal controls
regarding financial reporting) which could adversely affect the
company's ability to record, process, summarize and report financial
data and have identified for the company's auditors any material
weaknesses in internal controls; and
o any fraud, whether or not material, that involves management or
other employees who have a significant role in the company's
internal controls.
Signed, this 31st day of March, 2006
/s/ Darryl F. Jones
---------------------------
Darryl F. Jones
Chief Financial Officer
DOCUMENT 5
CERTIFICATION OF FINANCIAL INFORMATION
FOR
CORRIENTE RESOURCES INC.
I, Ken Shannon, CEO and Chairman of Corriente Resources Inc., hereby certify
and confirm that:
o I have reviewed the company's Annual Report, which includes the
company's audited Consolidated Financial Statements and Management's
Discussion and Analysis, for the year ended December 31, 2005;
o based on my knowledge, the report does not contain any untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements made, in light of the
circumstances under which such statements were made, not misleading
with respect to the period covered by the report;
o based on my knowledge, the financial statements, and other financial
information included in the report, fairly present in all material
respects the financial condition, results of operations and cash
flows of the company as of, and for, the periods presented in the
report;
o I have disclosed to the issuer's auditors and to the audit committee
of the board of directors (or persons fulfilling the equivalent
function):
o all significant deficiencies in the design or operation of
internal controls (a pre-existing term relating to internal
controls regarding financial reporting) which could adversely
affect the company's ability to record, process, summarize and
report financial data and have identified for the company's
auditors any material weaknesses in internal controls; and
o any fraud, whether or not material, that involves management or
other employees who have a significant role in the company's
internal controls.
Signed, this 31st day of March, 2006.
/s/ Kenneth R. Shannon
---------------------------
Kenneth R. Shannon
CEO and Chairman
DOCUMENT 6
Disclosure statements as required
by National Instrument 43-101 are
available at our website
www.corriente.com
[CORRIENTE RESOURCES INC. GRAPHIC OMITTED]
"NEWS RELEASE"
For Immediate Release April 5, 2006
---------------------
CTQ -TSX
CORRIENTE RESOURCES INC. SHARES TO BEGIN TRADING ON AMEX
UNDER THE SYMBOL "ETQ" ON THURSDAY, APRIL 6, 2006
Corriente is pleased to announce that its common shares will begin trading on
the American Stock Exchange on Thursday, April 6, 2006.
Dan Carriere, Corriente's Senior Vice President commented, "Our listing on the
American Stock Exchange will provide U.S. investors with much more direct
access to our copper growth story. As well, this listing will allow us to
expand our shareholder base in the largest capital market in the world. We also
believe that this listing will prove to be very positive for the company and
the American Stock Exchange, and we are very pleased to have been accepted by
such a respected exchange."
Corriente is moving towards construction of a starter operation at its Mirador
copper-gold operation. Mirador is one of the few new, sizeable copper projects
available for near-term production. Beyond the Mirador project, Corriente has a
unique pipeline of copper resource development projects which could keep
production rates in the Corriente Copper Belt district growing for over a
decade. Corriente controls a 100% interest in over 50,000 hectares located
within the Corriente Copper Belt, Ecuador. The Belt currently contains three
copper and copper-gold porphyry deposits, Mirador, Panantza and San Carlos.
Additional exploration activities will be ongoing, as six additional copper and
copper-gold exploration targets have been identified in the Corriente Copper
Belt to date.
"Dan Carriere"
Daniel A. Carriere
Senior Vice-President
The Toronto Stock Exchange has neither approved nor disapproved of the
information contained herein.
For further information please contact Mr. Dan Carriere, Senior Vice-President
at (604) 687-0449 or see our web site at www.corriente.com
Certain statements contained in this News Release constitute forward-looking
statements. Such forward-looking statements involve a number of known and
unknown risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the company's plans to materially
differ from any future results, performance or achievements expressed or
implied by such forward-looking statements. Readers are cautioned not to place
undue reliance on these forward-looking statements, which speak only as of the
date the statements were made, and readers are advised to consider such
forward-looking statements in light of the risks set forth in the company's
continuous disclosure filings as found at www.sedar.com .
520 - 800 West Pender Street, Vancouver, B.C. V6C 2V6
T (604) 687-0449 F (604) 687-0827 Email copper@corriente.com
DOCUMENT 7
MANAGEMENT'S DISCUSSION & ANALYSIS
(Expressed in Canadian dollars unless otherwise noted)
March 24, 2006
Management's Discussion and Analysis supplements, but does not form part of, the
audited consolidated financial statements of the company and the notes thereto
for the fiscal year ended December 31, 2005. Consequently, the following
discussion and analysis of the financial condition and results of operations for
Corriente Resources Inc. should be read in conjunction with the audited
consolidated financial statements for the years ended December 31, 2005 and 2004
and related notes therein, which have been prepared in accordance with Canadian
generally accepted accounting principles, consistently applied.
Additional information regarding the company, including its Annual Information
Form, can be found on SEDAR at www.sedar.com.
Forward-Looking Statements
Certain statements contained in the following Management's Discussion and
Analysis (MD&A) and elsewhere constitute forward-looking statements. Such
forward-looking statements involve a number of known and unknown risks,
uncertainties and other factors which may cause the actual results, performance
of achievements of the company to materially different from any future results,
performance or achievements expressed or implied by such forward-looking
statements. Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date the statements were
made, and readers are advised to consider such forward-looking statements in
light of the risks set forth below.
Corporate Governance
Management of the company is responsible for the preparation and presentation of
the annual consolidated financial statements and notes thereto, MD&A and other
information contained in this annual report. Additionally, it is Management's
responsibility to ensure the company complies with the laws and regulations
applicable to its activities.
The company's Management is accountable to the Board of Directors (Directors),
each member of which is elected annually by the shareholders of the company. The
Directors are responsible for reviewing and approving the annual audited
consolidated financial statements and the MD&A. Responsibility for the review
and approval of the company's quarterly unaudited interim consolidated financial
statements and MD&A is delegated by the Directors to the Audit Committee, which
is comprised of three directors, all of whom are independent of Management.
Additionally, the Audit Committee pre-approves audit and non-audit services
provided by the company's auditors.
The auditors are appointed annually by the shareholders to conduct an audit of
the consolidated financial statements in accordance with generally accepted
auditing standards. The external auditors have complete access to the Audit
Committee to discuss audit, financial reporting and related matters resulting
from the annual audit as well as assist the members of the Audit Committee in
discharging their corporate governance responsibilities.
The disclosure of Corriente's corporate governance policies is contained in the
company's Information Circular prepared for the May 2006 Annual General Meeting
and which is available for review at www.sedar.com. The disclosure statement has
been prepared by the company's Corporate Governance Committee and approved by
the Board of Directors.
Page 1 of 15
DISCLOSURE CONTROLS
Corriente has daily, weekly, monthly and annual processes that, when considered
in the aggregate and in conjunction with current internal controls, are
considered to be effective disclosure controls. In addition, Corriente has
created a Corporate Disclosure Committee, comprised of the Chief Executive
Officer, Senior Vice-President, and Chief Financial Officer. This Committee
supplements these periodic processes.
Disclosure Controls and Procedures have been developed to ensure that material
information relating to Corriente and its subsidiaries is made known to us by
others within those entities, particularly within a period in which a disclosure
report is being prepared. These involve:
o identification of all continuous disclosure requirements under
securities laws, rules and policies applicable to Corriente.
o identification of the individuals responsible for preparing reportable
information and individuals, whether internal or external, responsible
for reviewing reports or portions of reports to verify disclosure made
with respect to their areas of responsibility or expertise.
o establishment of timetables for the preparation and adequate review of
reportable information.
o procedures for obtaining "sign-off" on disclosure of reportable
information and receipt of written consents from all experts whose
reports are included or referred to in any disclosure.
o procedures for the identification and timely reporting to the Committee
of information which may constitute material information or which may
constitute a material change to previously disclosed material
information, including the identification of individuals who are likely
to learn first about events outside the control of Corriente that may
give rise to material information.
o procedures for the identification and reporting to the Audit Committee
of the Board of Directors of any fraud, whether or not material, that
involves management or other employees who have a significant role in
Corriente's internal controls.
o ensuring the procedures are followed with respect to the release of each
disclosure made in writing and for the review of any disclosure made
orally.
o ongoing evaluation of Corriente's disclosure controls and procedures.
Corriente and its subsidiaries are relatively small in size and operate in a
very integrated management environment. That is, senior management is in
constant contact with many of Corriente's staff, suppliers, regulators and the
like on an ongoing and detailed basis. This allows one or more of senior
management to be in a position where they are more likely to be aware (than not)
of material events or information. While senior management may not be aware of
all things at all times, it believes that the probability of a material event or
material information being missed or not disclosed on a timely basis is very
small.
As new Canadian accounting standards are released, the Chief Financial Officer
undertakes a review and evaluation to determine if it is applicable. If there is
any uncertainty in its applicability, Corriente solicits the input of the
external auditor. If the new standard is applicable
Page 2 of 15
to Corriente, it is then analyzed and summarized in a manner that effectively
documents and evaluates the impact on Corriente, and to determine the immediate
action, if any, Corriente would need to undertake in order to comply with the
new standard. Quarterly, the documented standards are reviewed, and updated as
required, to ensure that a standard is still applicable, and that Corriente
remains in compliance.
Through implementation of the above, senior management believes that the
company's disclosure controls are sufficient while being practical for a company
of its size.
General
Corriente is a Canadian-based junior resource exploration company engaged in the
exploration and development of copper-gold resource properties located primarily
in the Corriente Copper Belt in Ecuador. Under various agreements signed with
certain Ecuadorian subsidiaries of BHP Billiton LLC ("BHP Billiton"), the
company has earned a 100% interest in certain of BHP Billiton's resource
properties located in the Rio Zamora copper porphyry district (Corriente Copper
Belt), in Ecuador. This required the issue of shares to BHP Billiton and the
expenditure of exploration funds under the terms of these agreements.
Additionally, these concessions are subject to a 2% Net Smelter Royalty ("NSR")
payable to BHP Billiton, though the company has options to reduce the NSR to 1%
for the Mirador, Panantza and San Carlos resource properties upon the payment of
US$2 million for each option exercised to BHP Billiton.
As a result, Corriente controls a 100% interest in over 50,000 hectares located
within the Corriente Copper Belt. The Belt extends over a 20 x 80 kilometre area
in southeast Ecuador. The Belt currently contains three copper and copper-gold
porphyry deposits, Mirador, Panantza and San Carlos. Six additional copper and
copper-gold exploration targets have been identified in the Corriente Copper
Belt to date.
Mirador Project
Feasibility Study
On April 14, 2005, the company announced the completion of its feasibility study
at the Mirador project which confirmed the economics of a 25,000 tonne/day open
pit milling operation. The prime consultant for the study is AMEC Americas
Limited, who completed the resource estimation, the metallurgical studies and
the mine model. The tailings facility was designed by Knight Piesold Ltd. and
Merit Consultants International Inc. prepared the final capital cost. The
Indicated Mineral Resources internal to the pit were estimated to be 111 Million
tonnes at an average grade of 0.67% copper and 0.22 g/t gold (with an average
cut-off of 0.4% Cu). The feasibility study highlights were:
o The project was forecast to annually produce approximately 128 Million
pounds of copper, 32,000 ounces of gold and 395,000 ounces of silver
during the first five years of production
o The mine model indicated a 12 year mine life
o At a long term copper price of US$1.00/lb, the study indicated a Pre-Tax
Internal Rate of Return for the project of 15.5% and a Net Present Value
of US$78 Million at an 8% discount rate
o The capital cost for the project was estimated to be US$204 Million
The initial 25,000 tonnes/day development phase for the Mirador project is able
to support the infrastructure requirements of a large copper operation and
includes allowances for expansion in the future. For example, the tailings site
has up to three times the required storage capacity, meaning the operation can
expand significantly in size without needing to locate new tailings
Page 3 of 16
facilities. The feasibility study was made available in final report form on May
13, 2005 and is posted on www.sedar.com, as well as www.corriente.com.
Assumptions for the financial conclusions of the feasibility study included:
pricing of US$1.00/lb for copper, US$400/oz for gold, US$6.50/oz for silver, and
a discount rate of 8%. The estimated Indicated Mineral Resources included in the
mine plan total approximately 111 Million tonnes grading 0.67% Cu and 0.22 g/t
Au (with an average cut-off of 0.4% Cu). Approximately 91 Million tonnes of
waste rock will be removed over the mine life, resulting in an average strip
ratio of about 0.8:1. The mine plan was based on a contract mining company
providing ore to a conventional copper concentrator at a rate of 25,000
tonnes/day (9.125 Million tonnes/a). All facilities were designed for this
throughput and operate on a continuous basis, 24 hours/day, 365 days/annum,
subject to maintenance downtime. Average production was estimated to be about
174,000 t/annum of copper concentrate over the mine life of 12 plus years.
Optimization Study
In November 2005, Corriente announced the results of an ongoing optimization
study completed by Mine Development Associates (MDA) of Reno, Nevada for the
starter project at the Mirador copper-gold deposit in Ecuador. This study built
on the 25,000 tonnes per day base case feasibility study which was released in
April 2005. The main change in the new work was the incorporation of the results
of 52 new drill holes which were completed during the summer of 2005 and led to
the calculation of a new resource model. The optimization work was based on a
Lerchs-Grossmann pit optimization completed by MDA and included a measured and
indicated resource of 346,968,000 tonnes at an average grade of 0.62% copper,
0.2 g/t gold and 1.6 g/t silver (with an average cut-off grade of 0.37% Cu). For
the purposes of the optimization study, all of the elements of the feasibility
study completed in April 2005 were retained (except for reduced pre-stripping
associated with the new pit optimizations). Approximately 491 Million tonnes
(Mt) of waste rock will be removed over the mine life, resulting in an average
strip ratio of about 1.4:1. The initial starter pit will have a 0.53:1 strip
ratio containing 101.5 Mt of ore at 0.67% Cu, 0.21 g/t gold and 1.8 g/t silver.
The mine plan was based on a contract mining company providing ore to a
conventional copper concentrator at a rate of 25,000 tonnes/day (9,125 Mt/a).
Optimization Study Highlights
-----------------------------
o The project is forecast to annually produce approximately 131 Million
pounds of copper, 32,000 ounces of gold and 398,000 ounces of silver,
during the first five years of production.
o The mine model indicates a 38 year mine life at a throughput of 25,000
tonnes per day.
o At a long-term copper price of US$1.10/lb, the study indicates a Pre-Tax
Internal Rate of Return (IRR) for the project of 22.6% and a Net Present
Value (NPV) of US$224 Million at an 8% discount rate. The Investment
Contract with the Government of Ecuador will determine the final tax
regime for the project, so after-tax numbers are not being presented
here.
o The capital cost for the project was revised to total approximately
US$195 Million (reflecting reduced pre-strip with the new mine plan).
With the results of the optimization study showing a robust project, Corriente
intends to move forward with development of the 25,000 tonnes per day starter
project at Mirador in the second half of 2006.
This optimization work demonstrated improved economics of the company's starter
project which is planned as the platform for later expansions at Mirador and
development of Corriente's Panantza-San Carlos and other copper projects in the
Corriente Copper Belt district.
Page 4 of 15
Tabulation of the revised project resources at Mirador using a cut-off of
0.40%Cu is set out in the table below. This work was carried out by Mine
Development Associates (Reno, NV) under the direction of Steve Ristorcelli,
P.Geo., C.P.G., an independent Qualified Person as defined by NI 43-101. The
resource estimate is based on 142 drill holes totaling 36,284 metres of core.
Revised Mirador Resources
-----------------------------------------------------------------------------------------------------------
Cu Cut-off Grade of 0.40%
-----------------------------------------------------------------------------------------------------------
Class Tonnes Cu Cu (%) Au (oz) Au (g/t) Ag (oz) Ag (g/t)
(000's) lbs (000's)
-----------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------
Measured 52,610 753,000 0.65 360,000 0.21 2,770,000 1.6
-----------------------------------------------------------------------------------------------------------
Indicated 385,060 5,134,000 0.60 2,380,000 0.19 18,760,000 1.5
-----------------------------------------------------------------------------------------------------------
Inferred 235,400 2,708,000 0.52 1,250,000 0.17 9,900,000 1.3
-----------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------
Previous Resources from September 2004 Disclosure
-----------------------------------------------------------------------------------------------------------
Indicated 310,000 0.65 0.20
-----------------------------------------------------------------------------------------------------------
Inferred 315,000 0.56 0.17
-----------------------------------------------------------------------------------------------------------
Resource classifications conform to CIM standards on Mineral Resources and
Reserves referred to in National Instrument 43-101. Mineral resources that are
not reserves do not demonstrate economic viability. Measured and Indicated
Mineral Resources are that part of a mineral resource for which quantity and
grade can be estimated with a level of confidence sufficient to allow the
application of technical and economic parameters to support mine planning and
evaluation of the economic viability of the deposit. An Inferred Mineral
Resource is that part of a mineral resource for which quantity and grade can be
estimated on the basis of geological evidence and limited sampling that can be
reasonably assumed, but not verified.
Selection of financing options for the project is planned during the first half
of 2006 and issuance of the Mining Permit is targeted for the second quarter
following approval of the Environmental Impact Assessment ("EIA"), which was
filed with the Ministry of Energy and Mines for Ecuador ("the Ministry") in
December 2005.
Environmental Impact Assessment
-------------------------------
The EIA covered both the environmental aspects of proposed mining operations in
Mirador and community and social plans associated with the same project. During
the lengthy preparation of the EIA, the company worked closely with the Ministry
to help ensure that the report met all required government guidelines and
regulations. The Mirador EIA is expected to be one of the most comprehensive
documents on social and environmental issues ever submitted to the Mines
Ministry in Ecuador. The submission followed an extensive consultation process
with the local communities that was carried out in late November and early
December 2005. Approval of the EIA is expected in the first half of 2006.
Personnel
Corriente continues to build its mine development and management team with the
September 2005 appointment of Tom Milner as President of Corriente.
Mr. Milner will be responsible for the execution of the Mirador Development Plan
utilizing his background experience as a mine developer and operator. Most
recently, Mr. Milner was Chief Operating Officer for Taseko Mines Ltd., with
responsibility for the successful 2004 restart of the open pit copper-molybdenum
Gibraltar Mine located in south central B.C. The Gibraltar Mine mills 35,000
tonnes of ore per day with an overall mining rate of 115,000 tonnes per day. In
addition to extensive operations experience at Gibraltar, Mr. Milner was
President of Brinco
Page 5 of 15
Coal Corporation, with responsibility for developing the Quinsam Coal Mine on
Vancouver Island from the feasibility study stage through environmental
approvals, permitting, construction and operations.
Mr. Ken Shannon will continue on as the company's Chairman and Chief Executive
Officer while Mr. Ron Simkus will assist Mr. Milner in the overall development
of the Mirador project.
Other
In June 2004, J. David Lowell exercised his option to obtain the company's
interest in the Warintza resource concession in exchange for his 10% interest in
Corriente's interests in the remaining concessions in the Corriente Copper Belt
(including Mirador, Panantza and San Carlos). The Warintza resource includes
four concessions totalling 20,000 hectares. As a result of this transaction, the
company has complete ownership of its Corriente Copper Belt resource properties,
comprised of concessions covering 50,000 hectares within the Corriente Copper
Belt, subject only to a 2% Net Smelter Royalty obligation to BHP Billiton.
In March 2004, the company entered into an agreement with Hidrelgen, S.A., an
associated company of Caminosca Caminos y Canales C. Limitada, to develop,
construct, and operate a 30-megawatt run-of-river hydroelectric generation
facility on the Sabanilla River (Sabanilla Power Project, or "SPP"), to supply
power to Corriente's planned Mirador copper mine. Market conditions for bank
financing of power projects did not allow the company to meet the deadline for
financing of the Sabanilla project, with the result that the agreement lapsed in
2005. Accordingly, deferred power project costs of $2,739,111 associated with
the Sabanilla project have been written off by the company at December 31, 2005.
In March 2006, the company announced that it has entered into a letter of intent
with Hidroabanico S.A. to supply the power needs of the Mirador project.
In December 2005, the company and BHP Billiton agreed to terminate the Global
Strategic Alliance Agreement. No commitments remain for either party.
The company's executive office is located in Vancouver, Canada while its Ecuador
operations are run from its subsidiary office located in Quito, Ecuador. With
the exception of short-term operational requirements for the subsidiaries, funds
have been maintained and controlled in Vancouver, both in Canadian and U.S.
dollars. In addition to its core staff, the company engages consultants as
necessary, to provide geological, mine development and pre-construction
consulting, design and other services. Overhead costs and efficiencies in
Ecuador continue to compare favourably with other South American exploration
areas.
Financial Results of Operations
All of the financial information referenced below has been prepared in
accordance with Canadian generally accepted accounting principles, applied on a
consistent basis.
--------------------------------------------------
Financial Data for Last Three Fiscal Years
----------------------------------------------------------------------------------------
Fiscal year ended Dec 31-05 Dec 31-04 Dec 31-03
----------------------------------------------------------------------------------------
Total revenues (000's) $ 0 $ 0 $ 0
----------------------------------------------------------------------------------------
Loss before extraordinary items (000's) $ 3,344 $ 714 $ 682
----------------------------------------------------------------------------------------
Net loss (000's) $ 3,344 $ 714 $ 682
----------------------------------------------------------------------------------------
Basic and diluted loss per share $ 0.07 $ 0.02 $ 0.02
----------------------------------------------------------------------------------------
Cash and cash equivalents (000's) $ 32,441 $ 12,603 $ 18,688
----------------------------------------------------------------------------------------
Total assets (000's) $ 67,100 $ 40,502 $ 35,948
----------------------------------------------------------------------------------------
Total long-term financial liabilities (000's) $ 0 $ 0 $ 0
----------------------------------------------------------------------------------------
Total shareholders' equity (000's) $ 66,124 $ 39,755 $ 35,527
----------------------------------------------------------------------------------------
Cash dividends declared per share $ 0.00 $ 0.00 $ 0.00
----------------------------------------------------------------------------------------
Page 6 of 15
The company's operations during the year ended December 31, 2005 produced a net
loss of $3,344,139 or $0.07 per share compared to a net loss of $714,062 or
$0.02 per share for 2004 and $682,092 or $0.02 per share for 2003. As the
company has not owned any revenue-producing resource properties, no mining
revenues have been recorded to date. The increase in net loss from 2004 was
primarily due to the write-down of the company's deferred power project, and
offset somewhat by the receipt and sales of marketable securities received on
assets previously written off.
Deferred mineral property development expenditures made on the company's target
projects within the Corriente Copper Belt totalled $8,845,049 for 2005 versus
$8,627,262 during 2004 and $1,511,358 for 2003, reflecting the company's
significant activities in furthering development of the Mirador starter mine.
These activities included costs incurred towards completion of the Mirador
feasibility and optimization study reports, as well as the continuing
development of the Mirador project infrastructure. Drilling of 52 holes for 2005
(2004 - 44 holes, 2003 - 7) has been done in order to achieve 2 goals. The first
goal was to drill holes around the low-grade margin of the proposed open pit to
test the geotechnical characteristics of the pit margins using oriented drill
core. This drilling has provided a good data base of new structural information
which will be used as part of an effort to redesign pit shells with steeper
slopes. This means more mineable material in the pit and less waste tonnes,
which ultimately leads to a lower mining cost. The second goal of this drill
program was to provide in-fill assays so that resources that had been classified
as inferred in the starter project block model could be upgraded to indicated
status and be included in the economic analysis of the project. As in recent
years, all exploration drilling in 2005 was contained to the company's Corriente
Copper Belt resource properties.
Deferred power project expenditures made by the company pursuant to its JV
contributions for development of the Sabanilla Power Project totalled $1,034,449
in 2005 (2004 - $1,704,602 and 2003 - $Nil). At the end of 2005, the company
wrote the costs of Sabanilla down to $Nil.
Administration expenses increased for 2005 to $2,639,979 from $1,778,010 in 2004
and $1,727,649 in 2003. The increase in 2005 is primarily due to an increase in
stock-based compensation to $1,224,274 (2004 - $709,424, 2003 - $762,558),
management fees, wages and benefits to $586,911 (2004 - $436,972, 2003 -
$395,637), investor relations and promotion to $255,780 (2004 - $189,486, 2003 -
$209,791), legal and accounting to $149,214 (2004 - $82,459, 2003 - $91,625),
travel to $91,378 (2004 - $74,053, 2003 - $58,321), insurance to $67,640 (2003 -
$53,178, 2002 - $43,889) and regulatory fees to $56,071 (2003 - $26,735, 2002 -
$45,758). The higher administrative costs reflected the granting of options to
employees and directors, the addition of seasoned mining resource development
management, the pursuit of financing, higher legal and accounting costs due to
the company's recent application to be listed on the American Stock Exchange,
increased corporate travel, higher insurance costs, and increased sustaining
fees based on the company's higher market capitalization.
Included in management fees, wages and benefits and in mineral properties and
investor relations are expenditures of $48,599 (2004 - $124,194, 2003 -
$263,088), $60,500 (2004 - $Nil, 2003 - $127,067) and $Nil (2004 - $66,667, 2003
- $36,000), respectively, for the year ended December 31, 2005 in respect of
administrative and technical services provided by companies affiliated with
employed officers. At December 31, 2005, $15,000 (2004 - $1,538, 2003 - $Nil)
was due to companies affiliated with employed officers.
Stock-compensation expenses were $1,224,274 for 2005 versus $709,424 for 2004
and $762,558 for 2003, reflecting the fair value of stock options granted during
2005 as calculated using the Black-Scholes Option Pricing Model.
Page 7 of 15
In 2003, the company sold its shares of its wholly-owned subsidiaries, Corriente
Argentina Inc. (Cayman) and Corriente Argentina S.A. (Argentina), including its
100% interest in the Taca-Taca property in Argentina. These assets were written
off in previous years. The following summarizes the amounts due to the company
from the purchaser according to the original agreement:
o US $25,000 on the Closing Date (received in 2002);
o US $25,000 cash and 100,000 shares of the purchaser one year from the
date of the Agreement (received in 2003);
o 100,000 shares of the purchaser two years from the date of the agreement
(received in 2004);
o 100,000 shares of the purchaser three years from the date of the
agreement (received in 2005);
o US $100,000 four years from the date of the agreement;
o US $1,000,000 five years from the date of the agreement;
o US $1,000,000 upon the Taca-Taca property achieving commercial
production.
On March 22, 2005 the company and the purchaser executed an amending agreement
whereby the payments due in years four and five of the agreement were changed to
one final tranche of 100,000 shares of the purchaser on the amending date. US
$1,000,000 remains due from the purchaser upon the Taca-Taca property achieving
commercial production. As collectibility of this amount remains uncertain, this
amount will be recorded when received. The company realized a total gain of
$1,882,000 based on the market value of the 200,000 shares of the purchaser
received in 2005. These shares were subject to a hold period which expired in
July 2005. During the hold period, the purchaser underwent a reorganization in
April 2005, at which time the company received an equivalent 200,000 shares of
each of the four post-reorganization companies. With the exception of 200,000
shares in one of the post-reorganization companies which remains non-public and
without market value, all of the shares were sold by the company before the end
of 2005.
The Polymet plant site in Bolivia (which was previously written off in 1998) was
sold during 2003. The company has received full consideration, totalling
$570,841 (including $88,320 received in 2005) from the purchaser.
Due to the company's lower average cash balance on hand during 2005, interest
income decreased to $209,422 from $382,237 and $136,738 for 2004 and 2003,
respectively.
-----------------------------
Financial Data for Last
Eight Quarters
---------------------------------------------------------------------------------------------------------------
Three months ended Dec-05 Sep-05 Jun-05 Mar-05 Dec-04 Sep-04 Jun-04 Mar-04
---------------------------------------------------------------------------------------------------------------
Total revenues (000's) $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
---------------------------------------------------------------------------------------------------------------
(Earnings) loss before $ 3,272 $ 1,404 $ 378 $ (1,710) $ (429) $ 425 $ 343 $ 369
extraordinary items (000's)
---------------------------------------------------------------------------------------------------------------
Net (earnings) loss (000's) $ 3,272 $ 1,404 $ 378 $ (1,710) $ (429) $ 425 $ 343 $ 369
---------------------------------------------------------------------------------------------------------------
(Earnings) loss per share $ 0.07 $ 0.03 $ 0.01 $ (0.04) $ (0.0) $ 0.01 $ 0.01 $ 0.01
---------------------------------------------------------------------------------------------------------------
As the company has not had any revenue-producing resource properties, no mining
revenues have been recorded to date. The significant net income generated in the
Mar-05 and Dec-04 quarters was due to the proceeds received in 2005 and 2004
from the sale of the company's Argentinian and Bolivian assets, which had been
written off in prior years. Excluding such proceeds, the company's net losses
for the last 8 quarters generally reflect the impact and timing of the recording
of stock-compensation expenses attributable to the Black Scholes Option Pricing
Model calculation of the fair value of stock options granted within the period,
offset by interest income earned from cash on hand.
Page 8 of 15
Related Party Transactions
During 2005, the company's new President was paid $60,500 (including $15,000
accrued at December 31, 2005) for managerial services provided to the company
through his consulting company, until he became an employee of the company at
the beginning of 2006. These fees were included in mineral property costs. Also,
a consulting firm owned by the company's Chief Financial Officer was paid a
total of $48,600 for managerial services until he became an employee at the
beginning of July 2005. This amount is included in management fees, wages and
benefits.
Fourth Quarter
During the fourth quarter of 2005, the company's cash balance increased by
$26,211,530, due mostly to the public offering completed in December 2005, which
raised net proceeds of $27,853,364. The company also received $63,400 in
proceeds from the exercise of stock options in the fourth quarter. Uses of cash
in the fourth quarter included $1,907,761 for mineral property costs.
Additionally, the company recorded a loss of $3,271,838 which was due primarily
to the $2,739,111 year-end write-down of costs previously capitalized for the
company's Sabanilla power project. Management fees, wages and benefits during
the fourth quarter were $251,524, including $160,000 in year-end bonuses.
Related to the December 2005 financing, investor relations expenditures of
$71,669 and travel costs of $48,999 were incurred in the fourth quarter. The
company also incurred legal and accounting costs of $106,730, which were
primarily related to associated expenses and fees for the 2006 listing of the
company's common shares on the American Stock Exchange. Interest income of
$45,239 contributed positively to the company's cash flow.
Critical Accounting Policies
The details of the company's significant accounting policies are presented in
note 2 of the company's audited consolidated financial statements which can be
found at www.sedar.com. The following policies are considered by management to
be essential to understanding the processes and reasoning that go into the
preparation of the company's financial statements and the uncertainties that
could have a bearing on its financial results:
Resource Properties
The Company capitalizes all costs related to investments in mineral property
interests on a property-by-property basis. Such costs include mineral property
acquisition costs and exploration expenditures, including interest on any
required guarantee. Costs are deferred until such time as the extent of
mineralization has been determined and mineral property interests are either
developed, the property sold or the Company's mineral rights allowed to lapse.
All deferred mineral property expenditures are reviewed, on a
property-by-property basis, to consider whether there are any conditions that
may indicate impairment. When the carrying value of a property exceeds its net
recoverable amount that may be estimated by quantifiable evidence of an economic
geological resource or reserve or the Company's assessment of its ability to
sell the property for an amount less than the deferred costs, provision is made
for the impairment in value and the property is written down to the estimated
fair value.
The amounts shown for acquisition costs and deferred exploration expenditures
represent costs incurred to date and do not necessarily reflect present or
future values.
Page 9 of 15
These costs are depleted over the useful lives of the properties upon
commencement of commercial production or written off if the properties are
abandoned, become impaired or the claims allowed to lapse.
Stock-based Compensation
Management is required to make significant estimates about future volatility and
the period in which stock options will be exercised. The selection of the
estimated volatility figure, and the estimate of the period in which an option
will be exercised will have a significant impact on the costs recognized for
stock based compensation. The estimates concerning volatility are made with
reference to historical volatility, which is not necessarily an accurate
indicator of volatility which will be experienced in the future. Management
assumes that stock options will remain unexercised until near their expiry date
because historical experience supports this assumption. However, the exercise of
options may occur at times different than those estimated, or options may expire
unexercised. For options which vest over future periods, management makes an
estimate of the percentage of options which are expected to be forfeited prior
to vesting based on historical experience, which may not be an accurate
indicator of future results. No adjustment is made for actual experience, except
for options which vest at specific dates over time, where management updates its
estimate of the number of unexercised options which are expected to vest in the
future. Such fair value is estimated using the Black-Scholes Option Pricing
Model, the assumptions of which can be found in Note 6 c) of the company's
consolidated financial statements for the year ended December 31, 2005.
Liquidity and Capital Resources
Working capital as at December 31, 2005 was $31,652,192, compared to $12,563,393
at December 31, 2004 and $18,866,608 at December 31, 2003. The increase for 2005
is primarily due to the completion of a brokered private placement on December
29, 2005 that raised net proceeds of $27,853,364. The main uses of cash during
2005 were expenditures associated with the development of the planned Mirador
mine of $8,845,449 (2004 - $8,627,262 and 2003 - $1,511,358) and the Sabanilla
Power Project of $1,034,449 (2004 - $1,704,662 and 2003 - $Nil). Proceeds from
the sale of the company's marketable securities received on assets previously
written off also contributed positively to the company's working capital.
As at December 31, 2005, the company had 53,751,393 (fully diluted - 56,606,393)
common shares issued and outstanding versus 45,421,393 (fully diluted -
49,055,141) and 41,606,295 (fully diluted - 48,540,141) for 2004 and 2003,
respectively. There was one brokered public offering in 2005 of 7,605,000 common
shares that raised $30,039,750 before issue costs of $2,186,386. Other share
issuances reflect the exercise of 475,000 stock options that raised $435,250 and
an exercise of 250,000 share purchase warrants that raised $200,000. In 2004,
there were no private placements, but 3,500,098 share purchase warrants and
315,000 stock options were exercised, raising $3,928,512 and $304,350,
respectively. In 2003, the company raised a total of $18,803,133 through the
issue of new shares and the exercise of vested options and warrants, as follows:
In February 2003, the company completed a non-brokered private placement of
1,000,000 units, which raised gross proceeds of $1,000,000 equity capital
($993,750 net of issue costs); in October 2003, the company closed a further
non-brokered private placement of 2,000,000 common shares for proceeds of $3.9
million; in November 2003, the company completed a brokered private placement of
4,750,000 units at a price of $2.50 per unit for gross proceeds of $11.875
million before issue costs of $809,381; and during 2003, the company received
cash proceeds of $2,380,513 and $463,250 pursuant to the exercises of share
purchase warrants and stock options, respectively.
Page 10 of 15
Historically, the company's capital requirements have been met by equity
subscriptions. While the company's current working capital is considered
sufficient to meet the company's administrative overhead for the next several
years, substantial capital is required to complete the company's mine. Actual
funding requirements may vary from those planned due to a number of factors,
including the progress of exploration and project development activity and
foreign exchange fluctuations. Management believes it will be able to raise
equity capital as required in the long term but recognizes the risks attached
thereto. The company continues to use various strategies to minimize its
dependence on equity capital, including the securing of joint venture partner
and supplier financing where appropriate.
Risk Factors
Companies operating in the mining industry face many and varied kinds of risks.
While risk management cannot eliminate the impact of all potential risks, the
company strives to manage such risks to the extent possible and practical.
Following are the risk factors which the company's management believes are most
important in the context of the company's business. It should be noted that this
list is not exhaustive and that other risk factors may apply. An investment in
the company may not be suitable for all investors.
Foreign Country and Political Risk
The resource properties on which the company is actively pursuing its
exploration and development activities are all located in Ecuador, South
America. As a result, the company is subject to certain risks, including
currency fluctuations and possible political or economic instability in Ecuador,
which may result in the impairment or loss of mineral concessions or other
mineral rights, and mineral exploration and mining activities may be affected in
varying degrees by political instability and government regulations relating to
the mining industry. Any changes in regulations or shifts in political attitudes
are beyond the control of the company and may adversely affect its business.
Exploration may be affected in varying degrees by government regulations with
respect to restrictions on future exploitation and production, price controls,
export controls, foreign exchange controls, income taxes, expropriation of
property, environmental legislation and mine and/or site safety. While
Management believes that the current political climate in Ecuador is stable,
there can be no certainty that this will continue going forward. To alleviate
such risk, the company funds its Ecuador operations on an as-needed basis and is
pursuing local partners. The company does not presently maintain political risk
insurance for its foreign exploration projects.
Exploration and Mining Risks
The business of exploring for minerals and mining involves a high degree of
risk. Due in some cases to factors that cannot be foreseen, only a small
proportion of the properties that are explored are ultimately developed into
producing mines. At present, only the company's Mirador project property has
proven or probable reserves while any planned exploration programs for the
company's other properties are an exploratory search for proven or probable
reserves. The mining areas presently being assessed by the company may not
contain economically recoverable volumes of minerals or metals. The operations
of the company may be disrupted by a variety of risks and hazards which are
beyond the control of the company, including labour disruptions, the inability
to obtain suitable or adequate machinery, equipment or labour and other risks
involved in the conduct of exploration programs. Once economically recoverable
volumes of minerals are found, substantial expenditures are required to
establish reserves through drilling, to develop metallurgical processes, to
develop the mining and processing facilities and infrastructure at any site
chosen for mining. Although substantial benefits may be derived from the
discovery of a major mineralised deposit, no assurance can be given that
Page 11 of 15
minerals will be discovered in sufficient quantities or having sufficient grade
to justify commercial operations or that funds required for development can be
obtained on a timely basis. The economics of developing copper, gold and other
mineral properties is affected by many factors including the cost of operations,
variations of the grade of ore mined, fluctuations in the price of minerals
produced, costs of processing equipment and such other factors as government
regulations, including regulations relating to environmental protection. In
addition, the grade of mineralization ultimately mined may differ from that
indicated by drilling results and such differences could be material. Depending
on the price of copper or other minerals produced, which have fluctuated widely
in the past, the company may determine that it is impractical to commence or
continue commercial production.
Financing Risks
The company has limited financial resources, has no source of operating cash
flow and has no assurance that additional funding will be available to it for
further exploration and development of its projects. Further exploration and
development of one or more of the company's properties will be dependent upon
the company's ability to obtain financing through joint venturing, equity or
debt financing or other means, and although the company has been successful in
the past in obtaining financing through the sale of equity securities, there can
be no assurance that the company will be able to obtain adequate financing in
the future or that the terms of such financing will be favourable. Failure to
obtain such additional financing could result in delay or indefinite
postponement of further exploration and development of its projects.
Limited Experience with Development-Stage Mining Operations
The company has no previous experience in placing resource properties into
production and its ability to do so will be dependent upon using the services of
appropriately experienced personnel or entering into agreements with other major
resource companies that can provide such expertise. There can be no assurance
that the company will have available to it the necessary expertise when and if
it places its resource properties into production.
Estimates of Mineral Resources and Production Risks
The Mineral Resource estimates included herein are estimates only, and no
assurance can be given that any proven or probable reserves will be discovered
or that any particular level of recovery of minerals will in fact be realized or
that an identified reserve or resource will ever qualify as a commercially
mineable (or viable) deposit which can be legally and economically exploited. In
addition, the grade of mineralization which may ultimately be mined may differ
from that indicated by drilling results and such differences could be material.
Production can be affected by such factors as permitting regulations and
requirements, weather, environmental factors, unforeseen technical difficulties,
unusual or unexpected geological formations and work interruptions. The
estimated Mineral Resources described herein should not be interpreted as
assurances or evidence of commercial viability or potential or of the
profitability of any future operations.
Base Metals Prices
The principal activity of the company is the exploration and development of
copper-gold resource properties. The mineral exploration and development
industry in general is intensely competitive and there is no assurance that,
even if commercial quantities of proven and probable reserves are discovered, a
profitable market may exist for the sale of the same. Factors beyond the control
of the company may affect the marketability of any substances discovered. Base
metals prices have fluctuated widely, particularly in recent years. The feasible
Page 12 of 15
development of such properties is highly dependent upon the price of copper and,
to a lesser extent, gold. A sustained and substantial decline in commodity
copper prices could result in the write-down, termination of exploration and
development work or loss of its interests in identified resource properties.
Competition
The company competes with many companies that have substantially greater
financial and technical resources than the company for the acquisition of
mineral properties as well as for the recruitment and retention of qualified
employees.
Environmental and other Regulatory Requirements
The activities of the company are subject to environmental regulations
promulgated by government agencies from time to time. Environmental legislation
generally provides for restrictions and prohibitions on spills, releases or
emissions of various substances produced in association with certain mining
industry operations, such as seepage from tailings disposal areas, which would
result in environmental pollution. A breach of such legislation may result in
imposition of fines and penalties. In addition, certain types of operations
require the submission and approval of environmental impact assessments.
Environmental legislation is evolving in a manner which means stricter
standards, and enforcement, fines and penalties for non-compliance are more
stringent. Environmental assessments of proposed projects carry a heightened
degree of responsibility for companies and directors, officers and employees.
The cost of compliance with changes in governmental regulations has a potential
to reduce the profitability of operations.
Companies engaged in exploration activities generally experience increased costs
and delays as a result of the need to comply with applicable laws, regulations
and permits. There can be no assurance that all permits which the company may
require for exploration and development of its properties will be obtainable on
reasonable terms or on a timely basis, or that such laws and regulations would
not have an adverse effect on any project that the company may undertake.
The company believes it is in substantial compliance with all material laws and
regulations which currently apply to its activities. However, there may be
unforeseen environmental liabilities resulting from exploration and/or mining
activities and these may be costly to remedy. Failure to comply with applicable
laws, regulations, and permitting requirements may result in enforcement actions
thereunder, including orders issued by regulatory or judicial authorities
causing operations to cease or be curtailed, and may include corrective measures
requiring capital expenditures, installation of additional equipment, or
remedial actions. Parties engaged in exploration operations may be required to
compensate those suffering loss or damage by reason of the exploration
activities and may have civil or criminal fines or penalties imposed for
violations of applicable laws or regulations and, in particular, environmental
laws.
Amendments to current laws, regulations and permits governing operations and
activities of exploration companies, or more stringent implementation thereof,
could have a material adverse impact on the company and cause increases in
expenditures and costs or require abandonment or delays in developing new mining
properties.
Corriente's policy is to abide by the regulations and requirements of Ecuador,
Canada and the World Bank.
Title Matters
Page 13 of 15
Title to and the area of mining concessions may be disputed. Although the
company has taken steps to verify the title to mineral properties in which it
has an interest in accordance with industry standards for the current stage of
exploration of such properties, these procedures do not guarantee the company's
title. Property title may be subject to unregistered prior agreements or
transfers and title may be affected by undetected defects.
Repatriation of Earnings
Currently there are no restrictions on the repatriation from Ecuador of earnings
to foreign entities. However, there can be no assurance that restrictions on
repatriation of earnings from Ecuador will not be imposed in the future.
Dependence On Key Personnel
The company's development to date has largely depended and in the future will
continue to depend on the efforts of key management. Loss of any of these people
could have a material adverse effect on the company and its business. The
company has not obtained and does not intend to obtain key-person insurance in
respect of any directors or other employees.
Share Price Fluctuations
In recent years, the securities markets have experienced a high level of price
and volume volatility, and the market price of securities of many companies,
particularly those considered development-stage companies such as the company,
have experienced wide fluctuations in price which have not necessarily been
related to the underlying asset values or prospects of such companies. Price
fluctuations will continue to occur in the future.
No Dividends
Investors cannot expect to receive a dividend on their investment in the company
in the foreseeable future, if ever. Investors should not expect to receive any
return on their investment in the company's securities other than possible
capital gains.
Outlook
Corriente controls a 100% interest in over 50,000 hectares located within the
Corriente Copper Belt in Ecuador. This includes three copper and copper-gold
porphyry deposits, called Mirador, Panantza and San Carlos. Measured and
indicated copper resources at a 0.40% cutoff at Mirador is 438 million tonnes at
0.61%Cu and 0.19g/t Au, while inferred resources at Panantza, San Carlos and
Mirador (excluding Mirador Norte) at a 0.40% cutoff are 395 million tonnes at
0.67% Cu and 0.08 g/t Au, 657 million tonnes at 0.61% Cu, and 235 million tonnes
at 0.52% Cu and 0.17 g/t Au, respectively.
The company fully intends to continue with the development and pre-construction
work necessary to build and commission an initial 25,000 tonnes/day mine on its
Mirador property. This starter mine is expected to serve as the base for the
phased development of the entire Corriente Copper Belt in southern Ecuador, with
financing for this project coming from a combination of equity, bank and
joint-venture partner and supplier financing sources.
The Environmental Impact Assessment has been submitted to the government of
Ecuador and approval of this application is the next major step in moving
Mirador forward. This approval is targeted for the second quarter 2006. The
beginning of the third quarter is planned for completion of a feasibility study
which will provide an assessment of the economic value
Page 14 of 15
created by expanding the production of Mirador from 25,000 tpd to 50,000 tpd in
the sixth year after start-up. Following completion of the expansion feasibility
study, a construction decision wil be made for Mirador.
A total of 15 to 20 thousand metres of drilling is also planned for 2006 with a
particular goal of identifying high grade copper targets which would make a
significant contribution to early mine development in the Corriente Copper Belt.
Page 15 of 15
DOCUMENT 8
CORRIENTE RESOURCES INC.
(the "Company")
NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS
NOTICE IS HEREBY GIVEN that the Annual General Meeting of Shareholders
of the Company will be held at the offices of Bull, Housser & Tupper LLP,
Evergreen/Fir Boardroom, 30th Floor, 1055 West Georgia Street, Vancouver,
British Columbia, on Thursday, May 25, 2006 at 10:00 a.m., for the following
purposes:
(a) to receive the financial statements of the Company for the fiscal
year ended December 31, 2005, together with the report of the
auditors thereon;
(b) to appoint auditors and to authorize the directors to fix their
remuneration;
(c) to determine the number of directors at six;
(d) to elect directors;
(e) to consider and, if deemed appropriate, approve amendments to the
Company's stock option plan; and
(f) to transact such further or other business as may properly come
before the meeting or any adjournment or adjournments thereof.
Registered shareholders who are unable to attend the meeting are
requested to read the notes included in the form of Proxy enclosed and then to
complete, date, sign and mail the enclosed form of Proxy in accordance with the
instructions set out in the Proxy and in the Information Circular accompanying
this Notice.
DATED at Vancouver, British Columbia, as of April 6, 2006.
BY ORDER OF THE BOARD
"Darryl F. Jones"
-----------------
Darryl F. Jones,
Chief Financial Officer and
Corporate Secretary
=============================================================================
| If you are a non-registered shareholder of the Company and receive these |
| materials through your broker or through another intermediary, please |
| complete and return the materials in accordance with the instructions |
| provided to you by your broker or other intermediary. Failure to do so |
| may result in your shares not being eligible to be voted by proxy at the |
| meeting. |
=============================================================================
DOCUMENT 9
[CORRIENTE RESOURCES INC.
Logo Graphic Omitted]
CORRIENTE RESOURCES INC.
______________________________________________________
Notice of Annual General Meeting
and Information Circular
_____________________________________________________
Date & Time: Thursday, May 25, 2006
at 10:00 A.M.
Place: Offices of Bull, Housser & Tupper LLP
Evergreen/Fir Boardroom
Suite 3000 - 1055 West Georgia Street
Vancouver, British Columbia
CORRIENTE RESOURCES INC.
(the "Company")
NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS
NOTICE IS HEREBY GIVEN that the Annual General Meeting of Shareholders
of the Company will be held at the offices of Bull, Housser & Tupper LLP,
Evergreen/Fir Boardroom, 30th Floor, 1055 West Georgia Street, Vancouver,
British Columbia, on Thursday, May 25, 2006 at 10:00 a.m., for the following
purposes:
(a) to receive the financial statements of the Company for the fiscal
year ended December 31, 2005, together with the report of the
auditors thereon;
(b) to appoint auditors and to authorize the directors to fix their
remuneration;
(c) to determine the number of directors at six;
(d) to elect directors;
(e) to consider and, if deemed appropriate, approve amendments to the
Company's stock option plan; and
(f) to transact such further or other business as may properly come
before the meeting or any adjournment or adjournments thereof.
Registered shareholders who are unable to attend the meeting are
requested to read the notes included in the form of Proxy enclosed and then to
complete, date, sign and mail the enclosed form of Proxy in accordance with the
instructions set out in the Proxy and in the Information Circular accompanying
this Notice.
DATED at Vancouver, British Columbia, as of April 6, 2006.
BY ORDER OF THE BOARD
"Darryl F. Jones"
-----------------
Darryl F. Jones,
Chief Financial Officer and
Corporate Secretary
=============================================================================
| If you are a non-registered shareholder of the Company and receive these |
| materials through your broker or through another intermediary, please |
| complete and return the materials in accordance with the instructions |
| provided to you by your broker or other intermediary. Failure to do so |
| may result in your shares not being eligible to be voted by proxy at the |
| meeting. |
=============================================================================
2
[CORRIENTE RESOURCES INC.
Logo Graphic Omitted]
_________________________
MANAGEMENT INFORMATION CIRCULAR
(as at April 6, 2006, unless indicated otherwise)
_________________________
SOLICITATION OF PROXIES
This Information Circular is furnished in connection with the solicitation of
proxies by the management of Corriente Resources Inc. (the "Company") for use at
the Annual General Meeting of Shareholders of the Company to be held on
Thursday, May 25, 2006 (the "Meeting") and any adjournment thereof at the time
and place and for the purposes set forth in the accompanying Notice of Meeting.
While it is expected that the solicitation will be primarily by mail, proxies
may be solicited personally or by telephone by the directors and regular
employees of the Company. All costs of solicitation will be borne by the
Company.
These securityholder materials are being sent to both registered and
non-registered owners of the securities. If you are a non-registered owner, and
the Company or its agent has sent these materials directly to you, your name and
address and information about your holdings of securities, have been obtained in
accordance with applicable securities regulatory requirements from the
Intermediary holding on your behalf. By choosing to send these materials to you
directly, the Company (and not the Intermediary holding on your behalf) has
assumed responsibility for (i) delivering these materials to you, and (ii)
executing your proper voting instructions. Please return your voting
instructions as specified in the request for voting instructions. (For further
information relating to non-registered owners, see the discussion below under
"INFORMATION FOR NON-REGISTERED (BENEFICIAL) OWNERS OF SHARES".)
INFORMATION FOR NON-REGISTERED (BENEFICIAL) OWNERS OF SHARES
The shares owned by many shareholders of the Company are not registered on the
records of the Company in the beneficial shareholders' own name. Rather, such
shares are registered in the name of a securities dealer, bank or other
intermediary, or in the name of a clearing agency (referred to in this
Information Circular as "Intermediaries"). Shareholders who do not hold their
shares in their own name (referred to in this Information Circular as
"non-registered owners") should note that ONLY REGISTERED SHAREHOLDERS OR DULY
APPOINTED PROXYHOLDERS ARE PERMITTED TO VOTE AT THE MEETING. A NON-REGISTERED
OWNER CANNOT BE RECOGNIZED AT THE MEETING FOR THE PURPOSE OF VOTING HIS SHARES
UNLESS SUCH HOLDER IS APPOINTED BY THE APPLICABLE INTERMEDIARY AS A PROXYHOLDER.
Non-registered beneficial owners who have not objected to their Intermediary
disclosing certain ownership information about themselves to the Company are
referred to as non-objecting beneficial owners ("NOBOs"). Those non-registered
owners who have objected to their Intermediary disclosing ownership information
about themselves to the Company are referred to as objecting beneficial owners
("OBOs").
In accordance with applicable securities regulatory policy (National Instrument
54-101 of the Canadian Securities Administrators), the Company has elected to
seek voting instructions directly from NOBOs. The Intermediaries (or their
service companies) are responsible for forwarding this Information Circular and
other Meeting Materials to each OBO, unless the OBO has waived the right to
receive them.
Meeting Materials sent to non-registered owners who have not waived the right to
receive Meeting Materials are accompanied by a voting instructions form (a
"VIF"). This form is provided instead of a proxy. By returning the VIF in
accordance with the instructions noted on it, a non-registered owner is able to
instruct the registered shareholder how to vote on behalf of the non-registered
owner. VIFs, whether provided by the Company or by an Intermediary, should be
completed and returned in accordance with the specific instructions noted on the
VIF.
In either case, the purpose of this procedure is to permit non-registered owners
to direct the voting of the shares which they beneficially own. If a
non-registered owner who receives a VIF wishes to attend the Meeting or have
someone else attend on his behalf, then the non-registered owner may request a
legal proxy as set forth in the VIF, which will grant the non-registered owner
or his nominee the right to attend and vote at the Meeting.
3
IF YOU ARE A NON-REGISTERED OWNER AND WISH TO VOTE IN PERSON AT THE MEETING,
PLEASE REFER TO THE INSTRUCTIONS SET OUT ON THE "REQUEST FOR VOTING
INSTRUCTIONS" (VIF) THAT ACCOMPANIES THIS INFORMATION CIRCULAR.
APPOINTMENT, REVOCATION AND VOTING OF PROXIES
Appointment of Proxyholders
The individuals named as appointed proxyholders in the accompanying form of
proxy are the Chief Executive Officer and the Chief Financial Officer of the
Company. A SHAREHOLDER WISHING TO APPOINT SOME OTHER PERSON (WHO NEED NOT BE A
SHAREHOLDER) TO REPRESENT HIM OR HER AT THE MEETING HAS THE RIGHT TO DO SO,
EITHER BY INSERTING SUCH PERSON'S NAME IN THE BLANK SPACE PROVIDED IN THE FORM
OF PROXY AND STRIKING OUT THE TWO PRINTED NAMES OR BY COMPLETING ANOTHER FORM OF
PROXY.
Deposit of Proxies
A proxy will not be valid unless the completed, dated and signed form of proxy
is received by Computershare Trust Company of Canada, Proxy Department, 100
University Avenue, 9th Floor, Toronto, Ontario, M5J 2Y1 (fax: 1.866.249.7775 or
416.263.9524), not less than 48 hours (excluding Saturdays, Sundays and
holidays) before the time for holding the Meeting or any adjournment thereof, or
is delivered to the Chairman of the Meeting prior to the commencement of the
Meeting or an adjourned meeting.
Revocation of Proxies
A registered shareholder who has given a proxy may revoke the proxy: (a) by
completing and signing a proxy bearing a later date and returning it to
Computershare Trust Company of Canada in the manner and so as to arrive as
described above; or (b) by depositing an instrument in writing executed by the
shareholder or by his/her attorney authorized in writing: (i) at the registered
office of the Company, Suite 520 - 800 West Pender Street, Vancouver, British
Columbia, V6C 2V6, at any time up to and including the last business day
preceding the day of the Meeting or any reconvened meeting at which the proxy is
to be used, or (ii) with the Chairman of the Meeting prior to the commencement
of the Meeting on the day of the Meeting or any reconvened meeting; or (c) in
any other manner permitted by law.
Voting of Proxies
The persons named in the accompanying form of proxy will vote shares in respect
of which they are appointed, on any ballot that may be called for, in accordance
with the direction of the shareholder appointing them. If the shareholder
specifies a choice with respect to any matter to be acted upon, the shares will
be voted accordingly. IN THE ABSENCE OF SUCH SPECIFICATION, SUCH SHARES WILL BE
VOTED IN FAVOUR OF THE MATTERS TO BE ACTED UPON AS SET OUT HEREIN. THE
ACCOMPANYING FORM OF PROXY CONFERS DISCRETIONARY AUTHORITY ON THE PERSON
APPOINTED PROXYHOLDER THEREUNDER WITH RESPECT TO AMENDMENTS OR VARIATIONS OF
THOSE MATTERS SPECIFIED IN THE FORM OF PROXY AND NOTICE OF MEETING AND WITH
RESPECT TO ANY OTHER MATTERS WHICH MAY PROPERLY BE BROUGHT BEFORE THE MEETING.
IN THE EVENT THAT AMENDMENTS OR VARIATIONS TO MATTERS IDENTIFIED IN THE NOTICE
OF MEETING ARE PROPERLY BROUGHT BEFORE THE MEETING, IT IS THE INTENTION OF THE
PERSONS DESIGNATED IN THE ACCOMPANYING FORM OF PROXY TO VOTE IN ACCORDANCE WITH
THEIR BEST JUDGEMENT ON SUCH MATTER OR BUSINESS. AT THE TIME OF PRINTING OF THIS
INFORMATION CIRCULAR, MANAGEMENT KNOWS OF NO SUCH AMENDMENT, VARIATION OR OTHER
MATTER.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
As at April 6, 2006, the Company has issued and outstanding 54,441,393 fully
paid and non-assessable common shares, each share carrying the right to one
vote. THE COMPANY HAS NO OTHER CLASSES OF VOTING SECURITIES.
-----------------------------------------------------
The record date for the determination of shareholders entitled to receive notice
of and to vote at the Meeting has been fixed at April 6, 2006. Any Shareholder
of record at the close of business on April 6, 2006 who either personally
attends the Meeting or who has completed and delivered a form of proxy in the
manner and subject to the provisions described above shall be entitled to vote
or to have his shares voted at the Meeting.
To the knowledge of the directors and executive officers of the Company, there
are no persons or companies as at April 6, 2006 who beneficially own, directly
or indirectly, or exercise control or direction over shares carrying more than
10% of the voting rights attached to all outstanding shares of the Company.
4
MATTERS TO BE CONSIDERED AT THE MEETING
Appointment of Auditors
The management of the Company will recommend to shareholders at the Meeting to
re-appoint PricewaterhouseCoopers LLP, Chartered Accountants, Vancouver, British
Columbia, as auditors of the Company, to hold office until the next annual
general meeting of shareholders, and authorize the directors to fix their
remuneration. PricewaterhouseCoopers LLP have been the auditors of the Company
since 1994.
Election of Directors
The Board of Directors presently consists of six directors and it is intended to
determine the number of directors at six and to elect six directors for the
ensuing year.
The term of office of each of the present directors expires at the Meeting. The
persons named below will be presented for election at the Meeting as
management's nominees and the appointed proxyholders named in the accompanying
form of proxy intend to vote for the election of these nominees. Management does
not contemplate that any of these nominees will be unable to serve as a
director. Each director elected will hold office until the next annual general
meeting of the Company or until his successor is elected or appointed, unless
his office is earlier vacated in accordance with the Articles of the Company, or
with the provisions of the Business Corporations Act (British Columbia) (the
"Act").
The following table sets out the names of the nominees for election as
directors, the province or state and the country in which each is ordinarily
resident, all offices of the Company now held by each of them, their principal
occupations, the period of time for which each has been a director of the
Company, and the number of common shares of the Company or any of its
subsidiaries beneficially owned by each, directly or indirectly, or over which
control or direction is exercised, as at the date hereof.
--------------------------------------------------------------------------------------------------------------------------------
Name, Position, Province/State Principal Occupation or Employment(1) Period as a
and Country of Residence(1)(2) Director of No. of
the Company Shares(1)
--------------------------------------------------------------------------------------------------------------------------------
RICHARD P. CLARK((3))((4))((5)) President and Chief Executive Officer, Red Back Mining July 30, 1996 500
Director, Resident of BC, Canada Inc. to date
LEONARD HARRIS((3))((4))((5)) Consultant to the mining industry July 7, 1995 Nil
Director, Resident of CO, USA to date
ANTHONY F. HOLLER(4)((5)) Chairman of the Board of Directors of Medsurge Medical September 10, 1,143,800
Director, Resident of BC, Canada Products Corp. 2003 to date
G. ROSS MCDONALD Chartered Accountant in public practice with Smythe January 7, 10,000
Director, Resident of BC, Canada Ratcliffe Chartered Accountants, Vancouver, BC 2004 to date
KENNETH R. SHANNON Chief Executive Officer and Chairman of the Company January 8, 1,190,062
Director, Chief Executive Officer & 1992 to date
Chairman, Resident of BC, Canada
DAVID G. UNRUH(3)(5) Retired; previously, non-executive Vice-Chair of both January 4, 10,000
Director, Resident of BC, Canada Westcoast Energy Inc. and Union Gas Limited, April 2003 2006 to date
to June 2005; Senior Vice-President and General Counsel,
Duke Energy Gas Transmission Corporation, March 2002 to
April 2003; Senior Vice-President, Law and Corporate
Secretary, Westcoast Energy Inc., 1993 to March 2002
--------------------------------------------------------------------------------------------------------------------------------
NOTES:
------
(1) The information as to province/state and country of residence, principal
occupation and shares beneficially owned is not within the knowledge of
the management of the Company and has been furnished by the respective
nominees. The description of the principal occupation or employment for
David Unruh is for the past five years.
(2) No proposed director is to be elected under any arrangement or
understanding between the proposed director and any other person or
company, except the directors and executive officers of the company acting
solely in such capacity.
(3) Members of the Audit Committee.
(4) Members of the Compensation Committee.
(5) Members of the Corporate Governance and Nominating Committee.
5
None of the proposed nominees for director of the Company:
(a) is, as at the date of this Information Circular, or has been, within ten
years before the date of this Information Circular, a director or
executive officer of any company that, while that person was acting in
that capacity:
(i) was the subject of a cease trade or similar order or an order that
denied the relevant company access to any exemption under
securities legislation, for a period of more than thirty
consecutive days;
(ii) was subject to an event that resulted, after the director or
executive officer ceased to be a director or executive officer, in
the company being the subject of a cease trade or similar order or
an order that denied the relevant company access to any exemption
under securities legislation, for a period of more than thirty
consecutive days; or
(iii) within a year of that person ceasing to act in that capacity,
became bankrupt, made a proposal under any legislation relating to
bankruptcy or insolvency, or was subject to or instituted any
proceedings, arrangement or compromise with creditors or had a
receiver, receiver manager or trustee appointed to hold its
assets; or
(b) has within the ten years before the date of this Information Circular,
become bankrupt, made a proposal under any legislation relating to
bankruptcy or insolvency, or become subject to or instituted any
proceedings, arrangement or compromise with creditors, or had a receiver,
receiver manager or trustee appointed to hold the assets of the proposed
director.
Amendment to Stock Option Plan
The Company has in place an incentive stock option plan dated November 1996, as
amended (the "Option Plan") for directors, officers, employees and consultants
to the Company and its subsidiaries. Under the Option Plan, the Company is
presently authorized to issue an aggregate of 6,524,830 common shares on
exercise of options. As at December 31, 2005, taking into account outstanding
options to purchase a total of 2,855,000 shares (representing 5.2% of the
Company's current outstanding share capital) and prior exercises of options to
purchase a total of 3,546,000 shares since the Option Plan's November 1996
inception, the Company had 123,830 shares (representing 0.2% of the Company's
current outstanding share capital) available for the grant of options.
Since December 31, 2005, the Company has granted options to purchase 25,000
shares to a new director who joined the Board in January 2006. Additionally, in
February 2006, options to purchase a total of 400,000 shares were granted to
senior management, as follows:
Number of Exercise Expiry
Name and Title Shares Price Date
------------------------------------------------------------------------------------------------
Kenneth R. Shannon, CEO and Chairman 110,000(1) $5.25 Feb. 3, 2011
Thomas E. Milner, President 110,000(1) $5.25 Feb. 3, 2011
Daniel A. Carriere, Senior Vice-President 110,000(1) $5.25 Feb. 3, 2011
Darryl F. Jones, CFO and Corporate Secretary 70,000(1) $5.25 Feb. 3, 2011
------------------------------------------------------------------------------------------------
(1) These options vest on the basis of 1/20th of the total each month following
the date of grant, subject to provisions for the acceleration of vesting if
certain milestones are met.
The above-referenced grant to senior management of options to purchase a total
of 400,000 shares exceeds the option room available under the Option Plan and,
accordingly, will not be effective unless and until shareholders approve an
increase in the number of shares available for the grant of options, as
discussed below.
The Company is in a new stage of its development, as it moves from its
historical role as an exploration company toward its intended new role as the
developer and operator of a copper-gold mine at Mirador. As a result, it needs,
and will continue to need, the flexibility to grant more options as a means to
attract people with the skills and talent it will require in the future to
complement its existing management group. For that reason, the Board has
approved an amendment to the Option Plan, subject to approval by shareholders in
accordance with the policies of the Toronto Stock Exchange, to increase the
number of shares that may be reserved for issue under the Option Plan from
6,524,830 to a rolling maximum of 10% of the number of common shares outstanding
immediately prior to the grant of the applicable option.
6
The Toronto Stock Exchange permits listed issuers to adopt a "rolling" stock
option plan, which fixes a maximum number of shares issuable under the plan in
terms of a percentage of the issuer's outstanding shares. Under a rolling plan,
any increase in the number of outstanding shares of the Company will result in
an increase in the number of shares that are available to be issued under the
plan in future, and any exercise of an option previously granted under the plan
will result in an additional grant being available under the plan. Under the
rules of the Toronto Stock Exchange, a rolling plan must be re-approved by
shareholders every three years following the institution of the plan.
Options to purchase a total of 690,000 shares have been exercised since December
31, 2005. If the proposed amendment to the Option Plan were made, then, as at
April 6, 2006 (being the date of this Information Circular), based on 54,441,393
shares outstanding, the aggregate number of shares issuable under the Option
Plan would be 5,444,139 shares, which, taking into account outstanding options
to purchase a total of 2,590,000 shares (representing 4.8% of the Company's
current outstanding share capital), including the options to purchase a total of
400,000 shares issued to senior management in February 2006, would leave the
Company with 2,854,139 shares available for the grant of options in the future.
The exercise price for an option issued under the Option Plan is determined by
the directors, but may not be less than the "market price", which is defined in
the Option Plan as the simple average of the simple averages of the daily high
and low board lot trading prices of the Company's common shares on the Toronto
Stock Exchange for each of the five trading days preceding the day on which the
option is granted. In order to make the minimum price at which shares may be
issued on exercise of options consistent with what the Board regards as standard
practice, the Board has approved an amendment to the Option Plan to change the
definition of "market price" in the Option Plan to the closing price of the
Company's common shares on the Toronto Stock Exchange on the trading day
immediately preceding the grant of the option.
The policies of the Exchange require the amendment of the Option Plan to be
approved by a majority of the votes cast on the resolution at the Meeting, other
than votes attaching to shares beneficially owned by insiders to whom shares may
be issued pursuant to the Option Plan and associates of such insiders. To the
knowledge of the Company, as at the date of this Information Circular, a total
of 8,090,741 shares held by insiders and their associates will not be counted
for the purpose of determining whether the required level of shareholder
approval has been obtained.
At the Meeting, the shareholders of the Company (with insiders and their
associates abstaining from the vote) will be asked to pass an ordinary
resolution in the following terms:
"RESOLVED that:
a. Section 3.1 of the Option Plan be amended to delete the phrase `The
maximum number of Shares available for the grant of Options under the Plan
and all other Share Compensation Arrangements then in existence will be
6,524,830 in the aggregate' and replace it with the following: `The maximum
aggregate number of Shares available for the grant of Options under the Plan
and all other Share Compensation Arrangements will be that number which is
equal to 10% of the total number of Shares actually outstanding immediately
prior to the grant of any particular Option. If Options are surrendered,
terminated or expire without being exercised, in whole or in part, the number
of Shares not purchased under such lapsed Options shall be added to the
number of Shares available for issuance under the Plan. If Options are
exercised, in whole or in part, the number of Shares purchased under such
exercised Options shall be added to the number of Shares available for
issuance under the Share Option Plan.'; and
b. Section 1.1(i) of the Option Plan be amended to delete the current
definition of "Market Price" and replace it with the following: `"Market
Price" means the closing market price of the Shares on the Toronto Stock
Exchange, if the Shares are then listed for trading thereon (and, if not so
listed, on the principal stock exchange on which the Shares are then listed),
on the trading day immediately prior to the grant of the Option."
7
STATEMENT OF CORPORATE GOVERNANCE PRACTICES
Corporate governance is the process and structure used to direct and manage the
business and affairs of an issuer with the objective of enhancing value for its
owners. National Instrument 58-101 of the Canada Securities Administrators -
Disclosure of Corporate Governance Practices ("NI 58-101") requires the Company
to disclose in this Information Circular its system of corporate governance.
Board of Directors
The Board of Directors of the Company consists of six directors, five of whom
are independent directors as defined in NI 58-101, meaning that, in each case,
he has no direct or indirect relationship with the issuer which could, in the
view of the Board, reasonably be expected to interfere with the exercise of his
independent judgment, and is not otherwise deemed not to be independent.
Applying the criteria in NI 58-101, each of Richard Clark, Leonard Harris,
Anthony Holler, Ross McDonald and David Unruh is an independent director. Ken
Shannon is considered not to be independent, on the basis that he is an
executive officer of the Company.
The independent directors hold regularly scheduled meetings without the
non-independent directors and other members of management in attendance and are
able to hold such meetings whenever they wish.
The Chairman of the Board, Ken Shannon, is not an independent director. The
independent members of the Board believe that their majority on the Board,
their sophistication and their knowledge of the Company's business are
sufficient to facilitate the functioning of the Board independently of
management and to provide for open and candid discussion among the independent
directors.
The attendance record of the directors at meetings of the Board during 2005 was
as follows:
---------------------------------------------------------------------------------------------------
| | Type of Meeting |
|--------------------------| -----------------------------------------------------------------------|
| | Board of Directors | Audit Committee | Corporate Governance |
| | | | Committee |
|--------------------------|- -----------------------| ---------------------|- ---------------------|
| Richard P. Clark | 3 of 6 | 4 of 4 | 2 of 2 |
| -------------------------| ----------------------- |----------------------| ----------------------|
| Leonard Harris | 6 of 6 | 4 of 4 | 2 of 2 |
|--------------------------| ----------------------- |----------------------| ----------------------|
| Anthony F. Holler | 6 of 6 | N/A | 2 of 2 |
|--------------------------| ----------------------- |----------------------| ----------------------|
| G. Ross McDonald | 6 of 6 | 4 of 4 | 1 of 2 |
|--------------------------| ----------------------- |----------------------| ----------------------|
| Kenneth R. Shannon | 6 of 6 | N/A | N/A |
---------------------------------------------------------------------------------------------------
Mr. Unruh joined the Board in January 2006. The attendance record of the
directors at meetings of the Board to date in 2006 is as follows:
------------------------------------------------------------------------------------------------------------------
| | Type of Meeting |
|--------------------------|---------------------------------------------------------------------------------------|
| | Board of Directors | Audit Committee | Compensation | Corporate Governance |
| | | | Committee | Committee |
|--------------------------|---------------------|--------------------|-----------------|--------------------------|
| Richard P. Clark | 1 of 3 | 1 of 1 | 1 of 1 | 1 of 1 |
|--------------------------|---------------------|--------------------|-----------------|--------------------------|
| Leonard Harris | 2 of 3 | 1 of 1 | 1 of 1 | 1 of 1 |
|--------------------------|---------------------|--------------------|-----------------|--------------------------|
| Anthony F. Holler | 3 of 3 | N/A | 1 of 1 | 1 of 1 |
|--------------------------|---------------------|--------------------|-----------------|--------------------------|
| G. Ross McDonald | 3 of 3 | 1 of 1 | N/A | 1 of 1 |
|--------------------------|---------------------|--------------------|-----------------|--------------------------|
| Kenneth R. Shannon | 3 of 3 | N/A | N/A | N/A |
|--------------------------|---------------------|--------------------|-----------------|--------------------------|
| David G. Unruh | 3 of 3 | 1 of 1 | N/A | 1 of 1 |
------------------------------------------------------------------------------------------------------------------
8
Other Directorships
The following directors of the Company are directors of other issuers that are
reporting issuers or the equivalent in Canada or elsewhere:
o Richard P. Clark is a director of Red Back Mining Inc., Atacama
Minerals Corp. and Sanu Resources Ltd.
o Leonard Harris is a director of Alamos Gold Inc., Canarc Resource
Corp., Cardero Resource Corp., Endeavour Silver Corp., IMA Exploration
Inc., Morgain Minerals Inc., Solitario Resources Corporation and
Sulliden Exploration Inc.
o Anthony F. Holler is a director of Medsurge Medical Products Corp. and
Response Biomedical Corp.
o G. Ross McDonald is a director of Fjordland Exploration Inc. and
Frontier Pacific Mining Corporation.
o David G. Unruh is a director of Westcoast Energy Inc., Union Gas
Limited, Catalyst Paper Corporation, Pacific Northern Gas Ltd. and
Ontario Power Generation Inc.
Mandates
The Board has adopted a written mandate in which it explicitly acknowledges
responsibility for its stewardship of the Company. The text of the Board's
written mandate is attached to this Information Circular as Appendix A.
Position Descriptions
The Board has not adopted written position descriptions for the Chairman of the
Board and the Chairman of each Board committee, on the basis that the role of
the Chairman is well understood by all of the directors. The Board has also not
adopted a written position description for the Chief Executive Officer, Mr.
Shannon, on the basis that his role and responsibilities are well understood by
him and by the other directors.
Orientation and Continuing Education
The Board does not have a formal orientation and education program for new
directors. Upon joining the Board in January 2006, David Unruh was provided
with an orientation program regarding the role of the Board, its committees and
its directors, and the nature and operation of the Company's current and past
business. The Board encourages directors to participate in continuing education
opportunities in order to ensure that the directors may maintain or enhance
their skills and abilities as directors, and maintain a current and thorough
understanding of the Company's business.
Ethical Business Conduct and Social Responsibility
The Board has adopted a Corporate Creed and a written code of business conduct
("Code of Conduct"), which is applicable equally to all directors, officers,
employees, consultants and suppliers of the Company and its subsidiaries. A
copy of the Code of Conduct, including the Corporate Creed, is available on the
Company's website at www.corriente.com, on SEDAR at www.sedar.com or on request
as indicated under "Additional Information" elsewhere in this Information
Circular.
The Company regards maintaining a culture of ethical business conduct and
social responsibility as critically important. Management consistently strives
to instil the Company's Corporate Creed principles into the practices and
actions of the Company's management and staff. The Board monitors compliance
with the Code of Conduct by requiring management, supervisors and business unit
leaders to assume responsibility for the conduct of those who report to them.
This means ensuring that the code is clearly communicated, leading by example,
establishing and maintaining controls designed to prevent or detect breaches,
appropriately investigating situations which may indicate a breach and dealing
appropriately with known breaches. All known or suspected breaches of the Code
of Conduct are required to be reported to a supervisor, general manager, the
Chief Executive Officer, or the Chief Financial Officer. All known or suspected
instances of fraud are required to be reported to the Audit Committee, who
report all complaints and allegations to the Board of Directors for
investigation.
The Code of Conduct calls on all directors, officers and employees of the
Company and its subsidiaries to strive to avoid situations that create, have
the potential to create, or create the appearance of, a conflict of interest. A
director or officer who has a material interest in any transaction or agreement
that comes before the Board for decision is required to disclose his or her
interest to the Board members and to abstain from any vote taken on the matter.
The Company's social responsibility objectives are embodied in the Company's
Corporate Creed and Health, Safety, Environment and Community Policy.
9
Nomination of Directors
The Corporate Governance and Nominating Committee is composed of four Board
members: Richard P. Clark, Leonard Harris, Anthony F. Holler and David G.
Unruh, all of whom are independent directors. The Corporate Governance and
Nominating Committee is responsible for identifying new candidates for the
Board as necessary, after considering what competencies and skills the
directors as a group should possess and assessing the competencies and skills
of the existing and any proposed directors, and considering the appropriate
size of the Board.
Compensation
The Compensation Committee is composed of three Board members: Richard P.
Clark, Leonard Harris and Anthony F. Holler, all of whom are independent
directors. The Compensation Committee is responsible for reviewing and
approving corporate goals and objectives relevant to the compensation of senior
management of the Company, evaluating performance in light of those goals and
making recommendations to the Board with respect to executive compensation
levels based on that evaluation, reviewing and making recommendations to the
Board with respect to the adequacy and form of the compensation of the
directors, and reviewing executive compensation disclosure before it is
publicly issued.
Audit Committee
The Audit Committee is composed of three Board members: Leonard Harris, Anthony
Holler and David Unruh, all of whom are independent directors. The disclosure
required by Form 52-110F1 relating to the Audit Committee is included in the
Company's Annual Information Form dated March 24, 2006 for its fiscal year
ended December 31, 2005, which is available on SEDAR at www.sedar.com.
Other Board Committees
The Board has no standing committees other than the Audit Committee, the
Compensation Committee and the Corporate Governance and Nominating Committee.
Assessments
The mandate of the Corporate Governance and Nominating Committee includes
overseeing the effective functioning of the Board, which includes a periodic
review of the effectiveness of the Board as a whole and of the composition of
the Board. To date, given the small size of the Board and the frequency with
which its meetings are held, the Board has not found it necessary to institute
any formal process in order to satisfy itself that the Board, its committees
and its individual directors are performing effectively.
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth all compensation paid in respect of the
individuals who were, at December 31, 2005, the Chief Executive Officer and the
Chief Financial Officer of the Company and the three other executive officers
of the Company whose total individual annualised salary and bonus exceeded
$150,000 during the financial year ended December 31, 2005 (the "Named
Executive Officers").
10
Summary Compensation Table
-------------------------------------------------------------------------------------------------------------------------
| | | Annual Compensation | Long Term | |
| | | | Compensation Awards | |
|--------------------------------|---------|------------------------------------------------------------------------------
| Name and Principal Position | Year | Salary | Bonus | Other Annual | Securities Under | All Other |
| | | ($) | ($) | Compensation | Options Granted | Compensation |
| | | | | ($) | (Number) | ($) |
|--------------------------------|---------|-----------|----------|--------------|----------------------|-----------------|
|Kenneth R. Shannon | 2005 | 240,000 | 120,000 | Nil | 100,000 | Nil |
|Chief Executive Officer & | | | | | | |
|Chairman | 2004 | 240,000 | Nil | Nil | Nil | Nil |
| | | | | | | |
| | 2003 | Nil | Nil | Nil | 665,000 | 254,200(1) |
| | | | | | | |
|--------------------------------|---------|-----------|----------|--------------|----------------------|-----------------|
|Darryl F. Jones(2) | 2005 | 75,000 | 35,000 | Nil | 50,000 | 48,600 |
|Chief Financial Officer & | | | | | | |
|Corporate Secretary | 2004 | Nil | Nil | Nil | 100,000 | 57,530(3) |
|--------------------------------|---------|-----------|----------|--------------|----------------------|-----------------|
|Daniel A. Carriere | 2005 | 200,000 | 80,000 | Nil | 100,000 | Nil |
|Senior Vice-President | | | | | | |
| | 2004 | 200,000 | Nil | Nil | Nil | Nil |
| | | | | | | |
| | 2003 | Nil | Nil | Nil | 540,000 | 172,000(4) |
|--------------------------------|---------|-----------|----------|--------------|----------------------|-----------------|
|Ronald S. Simkus(5) | 2005 | 208,000 | Nil | Nil | 100,000 | Nil |
|Senior Vice-President, Mining | | | | | | |
| | 2004 | 166,000 | Nil | Nil | 100,000 | Nil |
|--------------------------------|---------|-----------|----------|--------------|----------------------|-----------------|
|Thomas E. Milner(6) | 2005 | Nil | Nil | Nil | 300,000 | 60,500(7) |
|President | | | | | | |
--------------------------------------------------------------------------------------------------------------------------
NOTES:
-----
(1) These amounts were paid to Inca Management Inc., a company of which Mr.
Shannon is a principal, pursuant to a management agreement.
(2) Mr. Jones joined the Company in January 2004.
(3) These amounts were paid to DFJ Consulting Ltd., a company of which Mr.
Jones is a principal, pursuant to a management agreement.
(4) These amounts were paid to Carriere Financial Services Inc., a company of
which Mr. Carriere is a principal, pursuant to a management agreement.
(5) Mr. Simkus joined the Company in February 2004.
(6) Mr. Milner joined the Company in September 2005.
(7) These amounts were paid to Tom Milner Enterprises, a company of which Mr.
Milner is a principal, pursuant to a management agreement.
Stock Options
No stock options were granted to, or exercised by, the Named Executives during
the financial year ended December 31, 2005, except as follows:
Option Grants During the Most Recently Completed Financial Year
--------------------------------------------------------------------------------------------------------------------
Market Value
% of Total of Securities
Securities Options Underlying
Under Options Granted to Exercise or Options on the
Granted Employees in Base Price Date of Grant
Name (Number) Financial Year ($/Security) ($/Security) Expiration Date
--------------------------------------------------------------------------------------------------------------------
Kenneth R. Shannon 100,000 10.6 % $2.27 $2.27 July 25, 2008
Darryl F. Jones 50,000 5.3% $2.27 $2.27 July 25, 2008
Daniel A. Carriere 100,000 10.6 % $2.27 $2.27 July 25, 2008
Ronald S. Simkus 100,000 10.6 % $2.27 $2.27 July 25, 2008
Thomas E. Milner 300,000 31.9 % $2.99 $2.99 Sept. 6, 2008
11
The following table sets forth details of the financial year-end values of
unexercised options held by the Named Executives.
Aggregated Option Exercises During the Most Recently Completed Financial Year
and Financial Year-End Option Values
-----------------------------------------------------------------------------------------------------------------
Aggregate Value
of Unexercised
Securities Unexercised Options in-the-Money Options
Acquired on Aggregate Value at FY-End at FY-End
Exercise Realized (Number) ($)
Name (Number) ($) (All exercisable) (All exercisable)(1)
-----------------------------------------------------------------------------------------------------------------
Kenneth R. Shannon 250,000 $503,500 765,000(2) $3,182,400
Darryl F. Jones Nil Nil 150,000(3) $624,000
Daniel A. Carriere 150,000 $250,500 640,000(4) $2,662,400
Ronald S. Simkus Nil Nil 200,000(5) $832,000
Thomas E. Milner Nil Nil 300,000(6) $1,248,000
-----------------------------------------------------------------------------------------------------------------
(1) Based on the closing price of $4.16 for the shares of the Company on The
Toronto Stock Exchange on December 30, 2005, the last trading day of the
financial year.
(2) Stock option to purchase 300,000 shares at $0.90 per share granted on May
28, 2003 for a term of three years, stock option to purchase 240,000
shares at $0.89 per share granted on July 28, 2003 for a term of three
years, stock option to purchase 125,000 shares at $1.28 per share granted
on September 10, 2003 for a term of three years and stock option to
purchase 100,000 shares at $2.27 per share granted on July 25, 2005 for a
term of three years.
(3) Stock option to purchase 25,000 shares at $1.14 per share granted on
March 5, 2003 for a term of three years, stock option to purchase 75,000
shares at $3.32 per share granted on February 9, 2004 for a term of three
years, stock option to purchase 50,000 shares at $2.27 per share granted
on July 25, 2005 for a term of three years.
(4) Stock option to purchase 300,000 shares at $0.90 per share granted on May
28, 2003 for a term of three years, stock option to purchase 240,000
shares at $0.89 per share granted on July 28, 2003 for a term of three
years, and stock option to purchase 100,000 shares at $2.27 per share
granted on July 25, 2005 for a term of three years.
(5) Stock option to purchase 100,000 shares at $3.32 per share granted on
February 9, 2004 for a term of three years and stock option to purchase
100,000 shares at $2.27 per share granted on July 25, 2005 for a term of
three years.
(6) Stock option to purchase 300,000 shares at $2.99 per share granted on
September 6, 2005 for a term of three years.
Pension Arrangements
The Company and its subsidiaries do not have any pension arrangements in place
for any of the Named Executive Officers.
Employment Contracts and Termination Provisions
Mr. Shannon is employed by the Company as its Chief Executive Officer under a
three-year contract (subject to extension) effective January 1, 2004, which
provides for severance payments in certain circumstances. If Mr. Shannon's
employment is terminated by virtue of his death or permanent disability, or at
his instance for Good Reason (as defined in the agreement), he is entitled to
be paid an amount equivalent to 12 months' salary, target bonus and benefits.
If his employment is terminated by the Company without cause, or at his
instance for Good Reason within 12 months following a Change of Control (as
defined in the agreement), he is entitled to be paid an amount equivalent to
the greater of (a) 24 months' salary, target bonus and benefits, and (b) the
salary, bonus and benefits payable to the end of the term of the agreement. For
2005, Mr. Shannon was paid an annual salary of $240,000, which was subsequently
increased to $265,000 by the Board effective January 1, 2006. This change was
made by the Board on the recommendation of the Compensation Committee, which
had engaged Mercer Human Resource Consulting to undertake a review of the
compensation of the Company's senior management (see "Report on Executive
Compensation" below).
12
Mr. Milner was contracted by the Company during 2005 through his personal
holding company to perform the duties of President under an independent
contractor agreement terminating December 31, 2005, at a rate of $1,000 per
day. His holding company was paid a total of $60,500 for services from
September to December 2005. Effective January 1, 2006, Mr. Milner is employed
by the Company as its President under a five-year contract, which provides for
an annual salary of $255,000, target bonus, benefits and severance payments in
certain circumstances. If Mr. Milner's employment is terminated by virtue of
his permanent disability (subject to certain conditions) or at his instance for
Good Reason (including a Change in Control, all as defined in the agreement),
he is entitled to be paid an amount equivalent to 24 months' salary.
Mr. Carriere is employed by the Company as its Senior Vice-President under a
three-year contract (subject to extension) effective May 1, 2004, which
provides for severance payments in certain circumstances. If Mr. Carriere's
employment is terminated by virtue of his death or permanent disability, or at
his instance for Good Reason (as defined in the agreement), he is entitled to
be paid an amount equivalent to 12 months' salary, target bonus and benefits.
If his employment is terminated by the Company without cause, or at his
instance for Good Reason within 3 months following a Change of Control (as
defined in the agreement), he is entitled to be paid an amount equivalent to
the greater of (a) 24 months' salary, target bonus and benefits, and (b) the
salary, bonus and benefits payable to the end of the term of the agreement. For
2005, Mr. Carriere was paid an annual salary of $200,000, which was
subsequently increased to $225,000 by the Board effective January 1, 2006. This
change was made by the Board on the recommendation of the Compensation
Committee, which had engaged Mercer Human Resource Consulting to undertake a
review of the compensation of the Company's senior management (see "Report on
Executive Compensation" below).
Mr. Simkus is employed by the Company as its Senior Vice-President, Mining
under an annually-renewable one-year contract effective February 1, 2004, which
provides for severance payments in certain circumstances. If Mr. Simkus'
employment is terminated by virtue of the Company's election to do so without
Cause (as defined in the agreement), he is entitled to be paid an amount
equivalent to two months' salary. For 2005, Mr. Simkus was paid a total salary
of $208,000, at a rate of $1,000 per day. Effective February 1, 2006, Mr.
Simkus' annual salary was increased to $240,000, with the remainder of his
employment compensation and other terms to be finalized in negotiations
currently underway between the parties.
Mr. Jones was employed by the Company as its Chief Financial Officer and
Corporate Secretary during 2005, as follows: (a) from January 1 to June 30,
2005, Mr. Jones was contracted by the Company through his personal holding
company to perform his duties under an independent contractor agreement, and
was paid a total of $48,600, based on a rate of $575 per day; and (b) effective
July 1, 2005, Mr. Jones was employed by the Company under a three-year verbal
contract, which provides an annual salary of $150,000 and for severance
payments in certain circumstances. If Mr. Jones' employment is terminated by
virtue of his death or permanent disability, or at his instance for Good Reason
(as defined in the agreement), he is entitled to be paid an amount equivalent
to six months' salary, target bonus and benefits. If his employment is
terminated by the Company without cause, or at his instance for Good Reason
within three months following a Change of Control (as defined in the
agreement), he is entitled to be paid an amount equivalent to the greater of
(a) 12 months' salary, target bonus and benefits, and (b) the salary, bonus and
benefits payable to the end of the term of the agreement. Effective January 1,
2006, Mr. Jones' salary was increased to $175,000 by the Board. This change was
made by the Board on the recommendation of the Compensation Committee, which
had engaged Mercer Human Resource Consulting to undertake a review of the
compensation of the Company's senior management (see "Report on Executive
Compensation" below).
Stock Option Plan
The Company has in place an incentive stock option plan dated November 1996, as
amended (the "Option Plan") for directors, officers, employees, and consultants
to the Company and its subsidiaries. The Option Plan provides that the
directors of the Company may resolve to grant options to purchase common shares
on terms that the directors may determine, within the limitations of the Option
Plan. The maximum aggregate number of common shares available for the grant of
options under the Option Plan and all other share compensation arrangements of
the Company is set at 6,524,830, which is approximately 12% of the Company's
current outstanding share capital.
As at December 31, 2005, taking into account outstanding options to purchase a
total of 2,855,000 shares and prior exercises of options to purchase a total of
3,546,000 shares since the Option Plan's inception in 1996, the Company had
123,830 shares available for the grant of options.
Since December 31, 2005, the Company has granted options to purchase 25,000
shares to a new director who joined the Board in January 2006, and options to
purchase a total of 400,000 shares to senior management. The grant to senior
management of options to purchase a total of 400,000 shares exceeds the option
room now available under the Option Plan and, accordingly, is subject to
shareholder approval in accordance with the policies of the Toronto Stock
Exchange.
13
As described above under "Matters to be Considered at the Meeting - Amendment
to Stock Option Plan", it is proposed that the Company amend the Option Plan to
increase the number of shares that may be reserved for issue under it from
6,524,830 to a rolling maximum of 10% of the number of common shares actually
outstanding immediately prior to the grant of any particular option.
The exercise price for an option issued under the Option Plan is determined by
the directors, but may not be less than the "market price", which is defined in
the Option Plan as the simple average of the simple averages of the daily high
and low board lot trading prices of the Company's common shares on the Toronto
Stock Exchange for each of the five trading days preceding the day on which the
option is granted. As described above under "Matters to be Considered at the
Meeting - Amendment to Stock Option Plan", it is proposed that the Company
amend the Option Plan to change the Option Plan's definition of "market price"
to the closing price of the Company's common shares on the Toronto Stock
Exchange on the trading day immediately preceding the grant of the option.
The Option Plan does not provide for any financial assistance to be provided to
participants to facilitate the purchase of shares pursuant to options granted
under the Option Plan, nor is it the policy of the Company to provide such
assistance outside of the Option Plan.
The maximum number of common shares available for the grant of options under
the Option Plan and all other share compensation arrangements of the Company to
any one person is that number which is equal to 5% of the issued capital at the
time of grant. Options granted under the Option Plan are not assignable or
transferable.
No option may be granted for a term longer than 10 years. An option may expire
on such earlier date or dates as may be fixed by the Board, subject to earlier
termination in the event the optionee ceases to be eligible under the Option
Plan by reason of death, retirement or otherwise. Although the Option Plan does
not require vesting provisions, the Board may stipulate such provisions at the
time it grants an option under the Option Plan. If a take-over bid is made for
the common shares of the Company, the Company will so notify each optionee, and
will amend the terms of any option outstanding under the Option Plan to provide
that any otherwise applicable vesting restrictions are waived, so that the
optionee may exercise his or her option and tender to the take-over bid the
shares issued on exercise of the option.
Amendments to the Option Plan are subject to approval by the Toronto Stock
Exchange and any amendment to the Option Plan which increases the maximum
number of shares issuable under the Option Plan also requires
shareholder approval.
Securities Authorized for Issuance Under Equity Compensation Plans
The following table sets out all information required with respect to
compensation plans under which equity securities of the Company are authorized
for issuance, as at the end of the Company's financial year ended December 31,
2005:
------------------------------------------------------------------------------------------------------------------------
Plan Category Number of Securities to be Weighted-Average Number of Securities
Issued Upon Exercise of Exercise Price of Remaining Available for Future
Outstanding Options, Warrants Outstanding Options, Issuance Under Equity
and Rights Warrants and Rights Compensation Plans (Excluding
(a) (b) Securities Reflected in Column
(a))
(c)
------------------------------------------------------------------------------------------------------------------------
Equity compensation 2,855,000 $1.89 123,830
plans approved by
shareholders
Equity compensation N/A N/A N/A
plans not approved
by shareholders
------------------------------------------------------------------------------------------------------------------------
Total 2,855,000 $1.89 123,830
------------------------------------------------------------------------------------------------------------------------
14
Compensation of Non-Management Directors
The compensation payable to non-management directors comprises an annual
retainer, board and committee meeting fees and stock options. During the fiscal
year ended December 31, 2005, the Company paid directors' fees of $12,900 to
Richard P. Clark, $13,200 to Leonard Harris, $12,800 to Anthony F. Holler and
$13,100 to G. Ross McDonald (Mr. Unruh joined the Board in January 2006).
The following table sets forth stock options granted during the financial year
ended December 31, 2005 and the period to April 6, 2006, to the non-management
directors of the Company:
-------------------------------------------------------------------------------------------------------------------------
Name Date of Grant Common Exercise Market Value Expiration Date
Shares Under Price of Common
Options Shares on
Granted Date of Grant
-------------------------------------------------------------------------------------------------------------------------
Richard P. Clark June 1, 2005 25,000 $2.15 $2.15 June 1, 2008
Leonard Harris June 1, 2005 25,000 $2.15 $2.15 June 1, 2008
Anthony F. Holler June 1, 2005 25,000 $2.15 $2.15 June 1, 2008
G. Ross McDonald June 1, 2005 25,000 $2.15 $2.15 June 1, 2008
David G. Unruh January 23, 2006 25,000 $4.50 $4.15 January 23, 2011
-------------------------------------------------------------------------------------------------------------------------
Non-management directors of the Company did not exercise any stock options
during the financial year ended December 31, 2005 or the subsequent period to
April 6, 2006.
Management Contracts
No management functions of the Company or any of its subsidiaries are performed
to any substantial degree by a person other than the directors or executive
officers of the Company or subsidiary, except as disclosed herein.
Composition of the Compensation Committee
The Company`s compensation program is administered primarily by the
Compensation Committee, which reports to the full Board with its
recommendations. The Compensation Committee is composed of Richard P. Clark,
Leonard Harris and Anthony F. Holler, all of whom are outside directors.
Report on Executive Compensation
The Company's executive compensation program is designed to attract and retain
qualified and experienced executives, and to encourage and reward on the basis
of individual and corporate performance those in the best position to enhance
the Company's results and prospects, both in the short and the long term.
The compensation of the Company's senior management team, including its Chief
Executive Officer, has historically consisted of salary and stock options. In
January 2006, the Compensation Committee engaged Mercer Human Resource
Consulting to undertake a review of the compensation of the Company's senior
management. Following the completion of that review, the Board, acting on the
recommendations of the Compensation Committee, made certain changes to the
Company's executive compensation regime for 2006, which now comprises salary,
bonus and stock option components.
The salary component of the Company's executive compensation program is
intended to reflect current industry standards. The bonus component is based on
performance milestones developed by the chairman of the Compensation Committee
in consultation with the Chief Executive Officer and approved by the Board. The
stock option component is intended to encourage and reward loyalty and
outstanding performance, and to align the interests of the executive officers
with the longer-term interests of shareholders by reinforcing an ownership
perspective.
The Board has sole discretion to determine the key employees to whom option
grants should be made and to determine the terms and conditions of any such
options. Individual grants of options are based on the Board's assessment of
the optionee's current and anticipated work performance, level of
responsibility within the Company, and importance to the Company. In addition,
the number and terms of outstanding options are taken into account when
determining whether and how many new options should be granted.
Presented by: Anthony F. Holler (Chairman), Richard P. Clark, Leonard Harris
15
Performance Graph
The following graph compares the percentage change in the Company's cumulative
total shareholder return on its common shares over the past five fiscal years
with the cumulative total return of the Standard & Poor's/Toronto Stock
Exchange Composite Index, based on an investment of $100 and assuming, wherever
relevant, the reinvestment of dividends.
Performance Graph
[GRAPHIC OMITTED]
16
INTEREST OF INFORMED PERSONS IN MATERIAL TRANSACTIONS
Other than as disclosed in this Information Circular, management is not aware
of any material interest, direct or indirect, of any informed person of the
Company, proposed nominee for election as a director, or any associate or
affiliate of the foregoing, in any transaction or proposed transaction since
January 1, 2005 which has materially affected or would materially affect the
Company or any of its subsidiaries.
OTHER BUSINESS
Management is not aware of any matter intended to come before the Meeting other
than those items of business set forth in the attached Notice. If any other
matters properly come before the Meeting, it is the intention of the persons
named in the form of proxy to vote in respect of those matters in accordance
with their best judgement.
ADDITIONAL INFORMATION
The Company's common shares are listed and posted for trading on the Toronto
Stock Exchange and on the Frankfurt, Munich and Berlin stock exchanges in
Germany under the symbol CTQ and on the American Stock Exchange (as of April 5,
2006) under the symbol ETQ.
Additional information relating to the Company, including copies of the
Company's financial statements for the fiscal year ended December 31, 2005
together with the report of the auditors thereon, management's discussion and
analysis of the Company's financial condition and results of operations for
2005, the Company's current Annual Information Form, and this Information
Circular are available on SEDAR at www.sedar.com or on request from the Chief
Financial Officer and Corporate Secretary of the Company at Suite 520 - 800
West Pender Street, Vancouver, British Columbia, V6C 2V6.
DIRECTORS' APPROVAL
The contents and the sending of this Information Circular have been approved by
the directors of the Company.
DATED at Vancouver, British Columbia, as of April 6, 2006.
BY ORDER OF THE BOARD OF DIRECTORS
"Darryl F. Jones"
-----------------
Darryl F. Jones,
Chief Financial Officer and Corporate Secretary
17
APPENDIX A
BOARD OF DIRECTORS MANDATE
Purpose of the Board of Directors
Corriente's Board of Directors (the "Board") is ultimately responsible for the
stewardship, the supervision and coaching of the management of the business and
affairs of Corriente and to act in the best interests of Corriente. The Board
will discharge its responsibilities directly and through its committees,
currently consisting of an Audit Committee, Compensation Committee, and
Corporate Governance Committee. The Board shall meet regularly to review the
business operations and corporate governance and financial results of
Corriente. Meetings of the Board shall include regular meetings with management
to discuss specific aspects of the operations of Corriente.
1. Composition of Board of Directors
1.1. The Board shall:
1.1.1. before each annual general meeting, receive from the
Corporate Governance Committee the recommendation of
candidates for the election of directors for the
ensuing year and recommend nominees to the
shareholders for election as directors for the
ensuing year;
1.1.2. receive from the Corporate Governance Committee the
recommendation of, and approve candidates to fill
vacancies on the Board between annual general
meetings;
1.1.3. appoint a Corporate Governance Committee, an Audit
Committee and a Compensation Committee, and appoint
the Chairman of each committee;
1.1.4. establish the mandate, duties and responsibilities of
each committee of the Board;
1.1.5. elect a Chairman of the Board and, when desirable, a
Vice-Chairman of the Board, and establish their
duties and responsibilities;
1.1.6. appoint the Chief Executive Officer of the Company,
who shall be a member of the Board, and establish the
duties and responsibilities of the Chief Executive
Officer; and
1.1.7. on the recommendation of the Chief Executive Officer,
appoint the senior officers of the Company and
approve the senior management structure of the
Company.
1.2. A principal responsibility of the Chairman of the Board will
be to manage and act as the chief administrative officer of
the Board with such duties and responsibilities as the Board
may establish from time to time.
1.3. The Board shall meet not less than six times during each year
and will endeavour to hold a minimum of one meeting in each
quarter. The Board will also meet at any other time at the
call of the Chairman of the Board or subject to the Memorandum
and Articles of the Company, the Chief Executive Officer, any
director or the Corporate Secretary.
2. Stewardship Responsibility
2.1. Subject to the Memorandum and Articles of Corriente (the
"Company") and applicable law, the Board has a stewardship
responsibility to:
2.1.1. supervise the management of and to oversee the
conduct of the business of the Company;
2.1.2. provide leadership and direction to management;
2.1.3. evaluate management;
2.1.4. set policies appropriate for the effective conduct of
business of the Company;
2.1.5. approve corporate strategies and goals; and
2.1.6. nominate directors.
2.2. The day to day management of the business and affairs of the
Company is delegated by the Board to the Chief Executive
Officer. The Board will give direction and guidance through
the Chief Executive Officer to management and the Chief
Executive Officer will keep management informed of the Board's
evaluation of the senior officers in achieving and complying
with established goals and policies.
3. Specific Responsibilities
3.1. The Board has the following specific duties and
responsibilities:
3.1.1. approve, supervise and provide guidance on the
strategic planning process. The Chief Executive
Officer and senior management team will have direct
responsibility for the ongoing strategic planning
process and the establishment of long term goals for
the Company, which are to be reviewed and approved
not less than annually by the Board. The Board will
provide guidance to the Chief Executive Officer and
senior management team on the Company's ongoing
strategic plan. Based on the reports from the Chief
Executive Officer, the Board will monitor the success
of management in implementing the approved strategies
and goals;
3.1.2. identify the principal risks of the Company's
business and use reasonable steps to ensure the
implementation of appropriate systems to manage and
mitigate these risks;
3.1.3. use reasonable steps to ensure the Company has
management of the highest calibre. This
responsibility is carried out primarily through the
appointment of the Chief Executive Officer as the
Company's business leader. The Board will assess, on
an ongoing basis, the Chief Executive Officer's
performance against criteria and objectives
established by the Board from time to time. The Board
will also use reasonable steps to ensure that the
Chief Executive Officer has in place adequate
programs to train, develop and assess the performance
of senior management;
3.1.4. keep in place adequate and effective succession plans
for the Chief Executive Officer and senior
management;
3.1.5. place limits on management's authority;
3.1.6. oversee the integrity of the Company's internal
control and management information systems;
3.1.7. oversee the Company's communications policy. The
Board will monitor the policies and procedures that
are in place to provide for effective communication
by the Company with its shareholders and with the
public generally, including effective means to enable
shareholders to communicate with senior management
and the Board. The Board will also monitor the
policies and procedures that are in place to maintain
a strong, cohesive and positive image of the Company
with shareholders, the mining industry, governments
and the public generally;
3.1.8. require that the Board be kept informed of the
Company's activities and performance and take
appropriate action to correct inadequate performance;
3.1.9. approve all significant capital plans and establish
priorities for the allocation of funds to ongoing
operations and capital projects;
3.1.10. approve all single expenditure items proposed by the
Company exceeding $250,000 not provided for in any
approved capital plan;
3.1.11. provide for the independent functioning of the Board.
The Board will put in place appropriate procedures to
enable the Board to function independently of
management at such times as is desirable or necessary
through:
3.1.11.1. the institution of mechanisms to allow
directors who are independent of management
an opportunity to discuss issues in the
absence of management, including meeting at
least annually in executive session without
the presence of non-independent directors
and management, and;
3.1.11.2. the engagement of outside advisors by
directors at the Company's expense subject
to the approval of the Corporate Governance
Committee.
3.1.12. adopt a formal code of business ethics that governs
the behavior of its directors, officers and
employees. The Board must monitor compliance with the
code of conduct and are responsible for granting any
waivers.
Limitation
----------
The duties and responsibilities set out above do not extend, and are not to be
interpreted as extending, the obligations and liabilities of the directors
beyond those imposed by applicable law and in each case are subject to the
Memorandum and Articles of the Company and applicable law.
This mandate supersedes and replaces all prior terms of reference pertaining to
the Committee and was adopted by a resolution of the Board effective November 9,
2005.
DOCUMENT 10
Corriente Resources Computershare
9th Floor, 100 University Avenue
Toronto, Ontario M5J 2Y1
www.computershare.com
Security
Holder Account Number
--
Form of Proxy - Annual General Meeting to be held on May 25, 2006
This Form of Proxy is solicited by and on behalf of Management.
Notes to proxy
1. Every holder has the right to appoint some other person or company of their
choice, who need not be a holder, to attend and act on their behalf at the
meeting. If you wish to appoint a person or company other than the persons
whose names are printed herein, please insert the name of your chosen
proxyholder in the space provided (see reverse).
2. If the securities are registered in the name of more than one owner (for
example, joint ownership, trustees, executors, etc.), then all those
registered should sign this proxy. If you are voting on behalf of a
corporation or another individual you may be required to provide
documentation evidencing your power to sign this proxy with signing capacity
stated.
3. This proxy should be signed in the exact manner as the name appears on the
proxy.
4. If this proxy is not dated, it will be deemed to bear the date on which it is
mailed by Management to the holder.
5. The securities represented by this proxy will be voted as directed by the
holder, however, if such a direction is not made in respect of any matter,
this proxy will be voted as recommended by Management.
6. The securities represented by this proxy will be voted or withheld from
voting, in accordance with the instructions of the holder, on any ballot that
may be called for and, if the holder has specified a choice with respect to
any matter to be acted on, the securities will be voted accordingly.
7. This proxy confers discretionary authority in respect of amendments to
matters identified in the Notice of Meeting or other matters that may
properly come before the meeting.
8. This proxy should be read in conjunction with the accompanying documentation
provided by Management.
--
Proxies submitted must be received by 10:00 am, Pacific Time, on May 23,
VOTE USING THE TELEPHONE OR INTERNET 24 HOURS A DAY 7 DAYS A WEEK!
[GRAPHIC OMITTED] [GRAPHIC OMITTED]
To Vote Using the Telephone To Vote Using the Internet
o Call the number listed BELOW o Go to the following web site:
from a touch tone telephone. www.computershare.com/proxy
1-866-732-VOTE (8683) Toll Free
If you vote by telephone or the Internet, DO NOT mail back this proxy.
Voting by mail may be the only method for securities held in the name of a
corporation or securities being voted on behalf of another individual.
Voting by mail or by Internet are the only methods by which a holder may appoint
a person as proxyholder other than the Management nominees named on the reverse
of this proxy. Instead of mailing this proxy, you may choose one of the two
voting methods outlined above to vote this proxy.
To vote by telephone or the Internet, you will need to provide your CONTROL
NUMBER, HOLDER ACCOUNT NUMBER and ACCESS NUMBER listed below.
CONTROL NUMBER HOLDER ACCOUNT NUMBER ACCESS NUMBER
Appointment of Proxyholder
The undersigned "Registered Print the name of the
Shareholder" of Corriente person you are ---------------
Resources Inc. (the "Company") appointing if this | |
hereby appoints: Kenneth R. person is someone | |
Shannon, Chief Executive OR other than the | |
Officer, or failing this Management Nominees ---------------
person, Darryl F. Jones, Chief listed
Financial Officer,
as my/our proxyholder with full power of substitution and to vote in accordance
with the following direction (or if no directions have been given, as the
proxyholder sees fit) and all other matters that may properly come before the
Annual General Meeting of Corriente Resources Inc. to be held at the offices of
Bull, Housser & Tupper LLP, Evergreen/Fir Boardroom, 30th Floor,
VOTING RECOMMENDATIONS ARE INDICATED BY HIGHLIGHTED TEXT OVER THE BOXES.
For Against
1. Determine Number of Directors
To determine the number of Directors at six (6). --- ---
| | | |
--- ---
--
2. Election of Directors
For Withhold For Withhold
01. Kenneth R. --- --- 02. Richard --- ---
Shannon | | | | P. Clark | | | |
--- --- --- ---
For Withhold For Withhold
03. Leonard --- --- 0.4 Anthony --- ---
Harris | | | | Holler | | | |
--- --- --- ---
For Withhold For Withhold
05. G. Ross --- --- 06. David --- ---
McDonald | | | | Unruh | | | |
--- --- --- ---
3. Appointment of Auditors For Withhold
Appointment of PricewaterhouseCoopers LLP
as auditors for the Company. --- ---
| | | |
--- ---
4. Fix Auditors' Remuneration For Against
To authorize the Directors to fix the
auditors' remuneration. --- ---
| | | |
--- ---
--
5. Amendments to Stock Option Plan For Against
To approve amendments to the Company's
Stock Option Plan. --- ---
| | | |
--- ---
Authorized Signature(s) - This section
must be completed for your instructions
to be executed.
I/We authorize you to act in accordance -------------------------
with my/our instructions set out above. | | MM/DD/YY
I/We hereby revoke any proxy previously | |
given with respect to the Meeting. If no | | / /
voting instructions are indicated above, ------------------------- --------
this Proxy will be voted as recommended
by Management.
DOCUMENT 11
CORRIENTE RESOURCES INC.
(the "Company")
Request for Annual Financial Statements and MD&A
And/Or Interim Financial Statements and MD&A
In accordance with National Instrument 51-102 of the Canadian Securities
Administrators, registered and non-registered (beneficial) shareholders of the
Company may request to receive the annual financial statements and the related
management's discussion and analysis ("MD&A") of the Company for fiscal 2005
and the interim financial statements and the related MD&A of the Company for
the first, second and third quarters of fiscal 2006. If you wish to receive
such material, please complete and return this form by mail or fax to:
Corriente Resources Inc.
Suite 520 - 800 West Pender Street
Vancouver, British Columbia V6C 2V6
Fax: 604.687.0827
Any response you make on this form will be in effect for 2006 only, in
accordance with securities regulations.
If you do not make the request below, you will not be sent the Company's Annual
Financial Statements and related MD&A for fiscal 2005 or the Company's Interim
Financial Statements and related MD&A for fiscal 2006. These documents may be
found on SEDAR at www.sedar.com.
I certify that I am a registered/non-registered owner of common shares of the
Company and request that I be placed on the Company's Mailing List in order to
receive [check one or both to effect the request]:
_______ the Company's Annual Financial Statements and related MD&A
for fiscal 2005
_______ the Company's Interim Financial Statements and related MD&A
for fiscal 2006
Name of Shareholder (please print): ___________________________________________
Address: ______________________________________________________________________
Signature: _____________________________________________________________
Date: _____________________________________________________________
Name and title of person signing (if different from name above): _____________
-------------------------------------------------------------------------------
DOCUMENT 12
Disclosure statements as required
by National Instrument 43-101 are
available at our website
www.corriente.com
[CORRIENTE RESOURCES INC. GRAPHIC OMITTED]
"NEWS RELEASE"
For Immediate Release May 4, 2006
---------------------
TSX: CTQ, AMEX: ETQ
ENVIRONMENTAL IMPACT ASSESSMENT APPROVED FOR MIRADOR COPPER PROJECT
Corriente announces that the Mirador copper project Environmental Impact
Assessment (EIA) has met all the legal requirements of the Ecuadorian Ministry
of Energy and Mining and approval has been granted on the EIA.
The Sub-Secretary of the Ministry, Mr. Carlos Muirriagi had the following
comment, "Ecuador is extremely pleased about the EIA approval and our
commitment is to help mining companies like Corriente that are making it
possible in the near future for Ecuador to become a metal mining country".
Corriente CEO, Ken Shannon said "Approval of an EIA is a major milestone during
the development of any deposit and thanks to the effort of our hard working
team in Ecuador, we are now in a position to move Mirador forward to achieve
our goal of becoming a mid-tier copper producer possessing a unique development
pipeline of projects that will allow for growth over the next decade".
Corriente is moving towards construction of a starter operation at its Mirador
copper-gold operation. Mirador is one of the few new, sizeable copper projects
available for near-term production. Corriente controls a 100% interest in over
50,000 hectares located within the Corriente Copper Belt, Ecuador. The Belt
currently contains three copper and copper-gold porphyry deposits, Mirador,
Panantza and San Carlos, as well as the newly discovered Mirador Norte
prospect. Additional exploration activities will be ongoing, as six additional
copper and copper-gold exploration targets have been identified in the
Corriente Copper Belt to date.
"Ken Shannon"
Kenneth R. Shannon
Chief Executive Officer
The Toronto Stock Exchange has neither approved nor disapproved of the
information contained herein.
For further information please contact Mr. Dan Carriere, Senior Vice-President
at (604) 687-0449 or see our web site at www.corriente.com
Certain statements contained in this News Release constitute forward-looking
statements. Such forward-looking statements involve a number of known and
unknown risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the company's plans to materially
differ from any future results, performance or achievements expressed or
implied by such forward-looking statements. Readers are cautioned not to place
undue reliance on these forward-looking statements, which speak only as of the
date the statements were made, and readers are advised to consider such
forward-looking statements in light of the risks set forth in the company's
continuous disclosure filings as found at www.sedar.com.
520 - 800 West Pender Street, Vancouver, B.C. V6C 2V6
T (604) 687-0449 F (604) 687-0827 Email copper@corriente.com
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
CORRIENTE RESOURCES INC.
----------------------------------
(Registrant)
Date: May 5, 2006 By: /s/ Darryl F. Jones
----------------- ------------------------------
Name: Darryl F. Jones
Title: Chief Financial Officer