The Vancouver-based company announced on June 6 that it had a binding agreement to sell the assets for US$9 million to entities affiliated with Waterton Global Resource Management.
Formation said Wednesday that the letter of agreement with the Waterton entities had called for the parties to work out definitive terms but they were unable to do so by the June 20 deadline.
The refinery assets aren't required for the development of Formation's Idaho cobalt project, said Mari-Ann Green, the company's CEO.
"As a result, Formation is assessing all of its options to maximize shareholder value. In the meantime, operations at the refinery are continuing," Green said in a statement.
The original announcement had led to objections from Toronto-based Dundee Corp. (TSX:DC.A), a Formation shareholder that said the plan and the selling price were "improvident."
Dundee, which owned about 17 per cent of Formation's stock and said it was the company's largest shareholder, also argued the sale required shareholder approval.
Dundee later said it no longer had confidence in Formation's management and proposed two alternative nominees for director seats held by Green and another member of the management team.
However, the B.C. Supreme Court denied Dundee's request for a order to block the sale and Green was re-elected as director of Formation at the company's annual meeting on June 21, as was Formation president Scott Bending.