Cordoba Minerals Corp. (TSXV:CDB; OTCQB:CDBMF) (“Cordoba” or the “Company”) announces today that further to its news release dated July 16, 2020, the Company has received notice from JCHX Mining Management Co., Ltd. (“JCHX”) of its election to exercise its anti-dilution right.
As such, JCHX has agreed to subscribe for 1,165,017 common shares of the Company at a price of C$0.0869 per share (the “Shares”) for gross proceeds of C$101,239.98, pursuant to the terms of a subscription agreement to be entered between the Company and JCHX. JCHX will maintain its 19.99% interest in the Company.
Cordoba intends to use the proceeds for working capital and general corporate purposes.
The issuance of the Shares is subject to the approval of the TSX Venture Exchange. Shares issued to JCHX will be subject to a four-month and one day hold period from the date of issue.
The issuance of the Shares to JCHX is considered a “related party transaction” under Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”) because JCHX is a related party to Cordoba by virtue of JCHX holding a 19.9% interest in the Company. Pursuant to Section 5.5(a) and 5.7(1)(a) of MI 61-101, Cordoba is exempt from obtaining a formal valuation and approval of Cordoba’s minority shareholders as the fair market value of the issuance of the Shares to JCHX is less than 25% of Cordoba’s market capitalization for the purposes of MI 61-101.
Cordoba will file a material change report in respect of the issuance of Shares to JCHX. However, the material change report is likely to be filed less than 21 days prior to the issuance of the Shares to JCHX, which is consistent with market practice and Cordoba deems reasonable in the circumstances.