Correspondence, Levi Syphus to Mrs. W.M. Clayton

St. George, Utah January 24, 1340 Mrs. Wm M. Clayton Santa Ana, Calif ornic Bear Madam: J g t j £ t ? S | | j f g because, perhaps, j f j j X was interested in what you had to say in your letter n-ns mrn- 1 h H themi ltlo fully materialize.^ bDeuirnignsg int het hle a|st§ twenty years I have sent received subscs<t?arnetf.i a|l| lyt net heD igs amfei narnecpilayl frcoomn ceerancsh ooff tthheem ,c o&tBo trvya,t : and caOnur bee nugsiende,e rsan da. ndt hecrheefmoirset s wea rea ren otn ota blien tetor epsrtoecde.s”s your ore so that it at, the Chamber °o/f WS£oimt.e_ erracaeg,n esdoletse niont tcheo nmtaatine riaanly sbuecnht onasi tey ou Assh owsetdated |stralta1|threjeeorJ e%f,|1 iW ^fefelt ti n \thb?inc£kn0ensist e wihimcphr egenxattenedds maaglmnoessti tet hroro ugdhooluotm ite four R1oHrw |f|iv eP ^h-uencdtrye,d _faeneat .w,h ipcohs sIi bbleel imeovree .e xtTehned s ordeo wcnownatrida nteod a ind eptthaht of strata must be p u n n e d and made into a proper blend of materials before it has any particular commercial value. The Values, millions ana millions of aollars worth of them, are contained in that magnesite deposit, dul they are of little value until they can be released? flmoi jRllP aSree with you that the Northwestern Magnesite Company NNeeiitthheerr ddooeps^ mthBe BaIsic 11Do1l1o mlilt,es eeC omIpIaPn y deofp osCilte vegloa nidn,t o Ohpiroo,d uwchtiicohn /is now operating the geeat Brucite deposits in Nevada, want to see it go into production^ although I am satisfied it has a process for handling our product, out as long as they think no one else can handle it thev ^suSb/s!i/d.i-arg<i?eisn S oJf° s£tueerl? haansd® SiIro nl eacsoen ceirtn. s, Bottheh ostfe etlh,o sei rocno,m paconpipeesr ,a reo r I aluminum companies do not want to see this deposit go into production, ior metal or otherwise, Decause it woula cut into their profits many agree, that it would / ~ w * V • » v M u t I 1 many thousands of aollars each year. Therefore X H a v®ry dangerous thing to grant a lease upon*all of the 'properIS u^on the terms, Mr. Burhans is asking. If only the minimum was taken each year, It would yiela only $18oo dollars together with the assessment work annually. The concerns mentioned, in the event they saw our deposit was coming into production, I mean the magnesite part of it, 1|0® it|h ouKsaindm a tyheeayr wetro e prgeevtetnitn g ito,u t whviecrhy wcohueladp lyb e ifa niit cec osbtu sitnheesms ofnolry the leasee, who woula only have to pay our stipend out of it annually, and pocket the balance. We would be tied hand and foot to the term of of the lease. Therefore, I agree with you, that all of the deposit should not be leased, whatever the rate of royalty per ton, for a minimum annual royalty, increasing yearly, to minimum amounts that would yield the several owners the sum of $100 per month each which you mention, but a great deal more. As to just what the royalty rate per ton should be , is in my opinion, a rather difficult matter to determine. I know the general rate paid in the past upon magnesite deposits has been one dollar per ton in the mine, but that was for magnesite pure enough to be used without treatment. That is a different proposition from ours. Therefore we must determine whether or not we will just continue to hold it until someone comes along having a process and will pay our price, which might or might not be in our lifetime, or whether or not we had better come to a lower rate and see if some one will work it out for us. Mr. Burhans processing company in New York may or may not be a subsidiary of one of the big metal companies. That is the reason why I sent 'Willard the letter of introduction, hoping that he would see Mr. Burhans, learn the name of his processing company, and then bheok on them as I suggested. I may say further that should Mr. Burhans company find a process for using the bentonite section of our deposit, then he will have unlocked, or found a method whereby bentonite can be combined with the great bulk of the magnesite in our deposit, or that is so much of it as can be marketed, and providing also the bentonite could be found for the mixture. I am reasonably certain such bentonite as there is in that streak of ours is a very high grade material, and if so such part of it may be refined to the point or to the extent that it could be applied to the highest uses to wnich bentonite is put. As for instance, Newsreel films, and in much more expensive products, If we do not give someone an opportunity to work upon some basis satisfactory to them, just how are we going to get going? I am not saying that we should reduce our one dollar rate off hand, out I do think it would be wise to give full consideration to the other fellow’s claims before absolutely refusing to give any reduction. I I said in my last letter that my process would refine the ore, only to the extent that would permit it to be used for refractory purposes. I was in error in making that statement, what I really meant was that because of my health condition and the lack of equipment, I cannot demonstrate it to be better before going. As a matter of fact, however, there is not any doubt in my mind, but what with the necessary equipment and a reliable man to follow.my. instructions, I can produce a practically pure magnesite, one suitable for both metal production and for plastic magnesia making for the construction of airplanes, boats, the smaller ocean-going vessels, etc., and I fully believe that I can prepare the magnesite in a way that it will answer for oil-refining .without bentonite. That is, there are certain parts of the magnesite wnich I know I can separate from the other and very confident it can be made to answer for oil refining, but that isn’t getting us anywhere. I suppose 1 am a poor promoter, otherwise I would not set out the worst phases of our magnesite deposit, and then try to raise money by using part of it as security. Be that as it may, however, I now make the following proposition, I am willing to give an undivided 1/16 interest in all of the claims for a loan of fifteen hundred dollars (l§00) for the period of two years time bearing interest at the rate of 6% per annum, and in addition, will give as a bonus_ a 20% interest in my process. The mortgage, or deed hypothecated in lieu thereof to provide there shall be no deficiency decree in case the security is forfeited. The applications for patent on my process has been in the U. S. Patent Office now for several months, and in case X secure the desired loan, X would at the time of its consummation fils in that office in connection with the application, a deed conveying title for the 20% to the Jiaanor. In the event you are acquainted with someone with money to han, and can induce nim to make me the loan, then I fully believe chat I can the deposit an immensely valuable one. make your interest in I regard it as quite possible Mr. Burhans people already know that they can successfully handle the magnesite and bentonite together. If so, they are not going to quit, but in the event they do not know it, then I think it probable that he is just about through. Very truly yours Levi W. Syphus St. George, Utah January 15, 1940 Mrs. W. M. Clayton Santa Ana California De ar Madam: Your letter of some weeks ago respecting Salt Company business, regarding which I wrote you and Doctor Neel, was duly received. I owe Dr. Neel an apology, as well as your- se If, for addressing each of you as though I were at present the director of the company. I had completely forgotten that I had been released from the Company’s Directory. Therefore, I hope that you will both pardon me, for the oversight. You will remember that in my said setter, I referred to a demand to cut magnesite royalties from one dollar to fifty cents per ton, and that in your said reply, you were emphatic that we should | H not permit it. Because of your opinion of the matter, I am representing that you are opposed to the cut, and that your interest in the property, together with Ed’s and some g other I am representing, altogether totaling some 46$ of the property will not consent to the cut. I trust that you will stand back of me in the matter, in order that if the cut has to be made, we will be able to keep it as high as possible. I have not discussed the matter with one or two owners, and possibly they may take our view of it. About a month ago, an engineer came to Overton representing that he was an agent of an Eastern Processing Company-, and that he was looking for bentonite, of which material there is a litcle in our property. He contacted John Perkins who showed him the property. He has been back two or three times. He called on# me about a week ago, and we discussed magnesite matters a couple of hours, He seemed or represented that if his condern could get a leas e on two or three claims, it would Satisfy them, and proposed a royalty of 150 per ton, it being very evident that he meant that as a first offer, and it was clear he would do a good deal better, but said thdy never would pay one dollar. Last Thursday he and John called on me agai n, and to my surprise, John had switched from one dollar to something near 500 and intimated that several * other owners were with him on the proposition, which I rather think is the case. It seems he had also agreed the party should have a lease on all of the property tor 20 years time under a minimum monthly ooyalty payment of $150 per month, and was to have six month’s time without doing anything. The engineer finally said however, that he thought his concern would perform the assessment work within this assessment year, and if they exercised their option for the lease, he thought they would pay the year1s minimum royalty in a lump sum, that is, at the rate of $150 per month, totaling $1800. It is my opinion that his concern has been working with it quite some time, and have found ways to apply it to use. He will not admit that, however, but pretends they require the sixth month’s time to iind a qay to use it. I have reason to believe they think they can, by combining it with bentonite, and may be able to use a lot of it for oil refining, and no doubt expect to use it for other purposes. It is my opinion they really want the property, and want it pretty badly. I did not yield anthing, however, and if you will stay with me on the proposition, even though I ma^ not be able to muster more than the 46$, I-think that will be enough to make them give better terms, even though we might have to modify our former positions somewhat. I am impressed that it would be a desirable outfit to lease to, if we can procure reasonable terms, it would be a fine thing to be relieved of this year’s assessment work*, and to have a few dollars each month coming in. I believe can force a higher monthly minimum payment for the time after the first year, I think a still higher one to apply after the expiration a=t$3kr the second year, do not like the idea of leasing the entire property, or with­holding it from sale. If part of it is w#ithhela from the lease so that a purchaser of the property would have ground to operate on , it would-be possible to sell it for a very good figure, subject to the continuance of the lease on the property. Unless such an arrangement can be affected, there are several owners of such an age, that they might as well bid goodbye to their hopes of realizing anything of consequence from their interest in the property, for it will be 2 or 3 years, very probably, before much is received under the lease. ! ' ' Please write me immediately as to your views on the matter and whether or not your are with me. Address your letter to me at Box H98, St. George, Utdh. Very j;ruly yours, Levi II Syphus Utah 1940 St. George, January 29, Mrs. io—1 j5S•» • Santa Ana, Ca Dear Madam; 1 am a 1 you. I hope that Willard called on Mr pleased to hear his conclusions with respect propositions at the earliest date possible, as you care to make, together with any information having another letter from Burhans, and I shall be to him and his nd also such comment you can give. I am happy to say I have learned definitely there has been no majority combination of the interest in the deposit to back Mr. Perkins' proposition. Including yourself, I have now heard from a total of more than a b0% interest in the deposit who do not approve of John's proposition and agree the royalty should be kept at one dollar per ton, or as nearly so as possible. They are also of theopinion a lease should not be given for more than a 10-year period and that only upon a reasonable zone of the deposit. Mr. Burhans wrote me on the 19th, the letter being delayed in transit, stating that he sincerely upped some proposition could be worked out under which business could be done. I may add in conclusion, there is no question but what the bentonite in the deposit is a^white high gel benconite and just what they are looking for. There is of course a question as to whether or not it can be economically separated. I feel that he is pretty sure of that, how­neovwe. r, since they have been working with samples for nearly two months Very truly yours, Levi W. Syphus