Cotec Holdings Corp. Announces Second and Final Closing of Non-Brokered Private Placement

Rhea-AI Summary

CoTec Holdings Corp. (CTHCF) has completed its second and final non-brokered private placement of units, raising $2,573,013.07 in gross proceeds. Each unit, priced at $0.50, includes one common share and one common share purchase warrant, exercisable at $1.05 within 12 months. The funds will support the HyProMag USA feasibility study, the Lac Jeannine Project's preliminary economic assessment, and general working capital. Insiders purchased 4,050,000 units for $2,025,000, making this a related party transaction under MI 61-101 exemptions. Following this issuance, CoTec has 66,047,531 common shares outstanding.

Positive

• Raised $2,573,013.07 in gross proceeds from the private placement.
• Pricing each unit at $0.50 includes a common share and a warrant with a potential future conversion at $1.05.
• Insiders' participation indicates confidence in the company's future.
• Funds allocated for critical projects: HyProMag USA feasibility study and Lac Jeannine Project's preliminary economic assessment.

Negative

• Private placement resulted in share dilution, increasing the total common shares to 66,047,531.
• The related party transaction might raise governance concerns among minority shareholders.
• Securities issued to Canadian investors have a statutory hold period of four months, which might affect liquidity.

VANCOUVER, BC / ACCESSWIRE / May 15, 2024 / CoTec Holdings Corp. (TSXV:CTH)(OTCQB:CTHCF) (the "Corporation") is pleased to announce that it has completed a second and final closing (the "Closing") of its previously announced non-brokered private placement of units (each, a "Unit") at a price of $0.50 per Unit for gross proceeds of up to $3,000,000 (the "Private Placement"). Each Unit consists of one common share in the capital of the Corporation (each a "Common Share") and one Common Share purchase warrant (each a "Warrant"). Each Warrant entitles the holder to purchase one Common Share at an exercise price of $1.05 for a period of 12 months following the issuance of the Units.

Pursuant to the Closing, the Corporation issued a total of 1,005,000 Units for gross proceeds of $502,500, resulting in an aggregate total of 5,146,025 Units issued in the Private Placement for aggregate gross proceeds of $2,573,013.07. The Corporation will use the gross proceeds of the Private Placement to fund the ongoing Feasibility Study for HyProMag USA, the Preliminary Economic Assessment of the Lac Jeannine Project and for general working capital purposes.

Insiders of the Corporation participated in the Private Placement and purchased an aggregate of 4,050,000 Units for gross proceeds of $2,025,000. As a result, the Private Placement is a related party transaction subject to Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). The Private Placement is exempt from the formal valuation requirements of MI 61-101 pursuant to subsection 5.5(b) of MI 61-101 because the Common Shares are listed only on the TSX Venture Exchange (the "TSXV") and is exempt from the minority shareholder approval requirements of MI 61-101 pursuant to subsection 5.7(1)(a) of MI 61-101 because neither the fair market value of the Units to be issued to related parties nor the consideration to be paid by related parties pursuant to the Private Placement is expected to exceed 25% of the Corporation's market capitalization as determined in accordance with MI 61-101. The Corporation did not file a material change report more than 21 days before the expected date of the Closing as the participation therein by related parties was not settled until shortly prior to Closing. The Corporation intends to file a material change report following the Closing.

All securities issued to Canadian investors in connection with the Private Placement will be subject to a statutory hold period of four months plus a day from the date of issuance in accordance with applicable securities legislation in Canada.

The number of common shares of the Corporation in issue following the Closing will be 66,047,531.

About CoTec

CoTec is a publicly traded investment issuer listed on the Toronto Venture Stock Exchange ("TSX- V") and the OTCQB and trades under the symbol CTH and CTHCF respectively. The Company is an environment, social, and governance ("ESG")-focused company investing in innovative technologies that have the potential to fundamentally change the way metals and minerals can be extracted and processed for the purpose of applying those technologies to undervalued operating assets and recycling opportunities, as the Company transitions into a mid- tier mineral resource producer.

CoTec is committed to supporting the transition to a lower carbon future for the extraction industry, a sector on the cusp of a green revolution as it embraces technology and innovation. The Company has made four investments to date and is actively pursuing operating opportunities where current technology investments could be deployed.

For further information, please contact:

Braam Jonker - (604) 992-5600

Forward-Looking Information Cautionary Statement

Statements in this press release regarding the Corporation's business which are not historical facts are "forward-looking statements" that involve risks and uncertainties, including statements relating to management's expectations with respect to the adoption of new technologies across the mineral extraction industry and the benefits to the Corporation which may be implied from such statements. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

NOT FOR DISTRIBUTION TO THE U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

SOURCE: CoTec Holdings Corp.

View the original press release on accesswire.com

FAQ

What was the total amount raised by CoTec Holdings Corp. in the private placement?

CoTec Holdings Corp. raised $2,573,013.07 in gross proceeds from the private placement.

What does each unit in CoTec Holdings Corp.'s private placement consist of?

Each unit consists of one common share and one common share purchase warrant, exercisable at $1.05 within 12 months.

How many common shares does CoTec Holdings Corp. have outstanding after the private placement?

Following the private placement, CoTec Holdings Corp. has 66,047,531 common shares outstanding.

What projects will the funds from CoTec Holdings Corp.'s private placement support?

The funds will support the HyProMag USA feasibility study, the Lac Jeannine Project's preliminary economic assessment, and general working capital.

What are the terms of the warrants issued in CoTec Holdings Corp.'s private placement?

The warrants are exercisable at $1.05 per common share within 12 months of issuance.

How many units did insiders purchase in CoTec Holdings Corp.'s private placement?

Insiders purchased 4,050,000 units in the private placement.

Why is CoTec Holdings Corp.'s private placement considered a related party transaction?

The private placement is a related party transaction because insiders of the participated, making it subject to MI 61-101 exemptions.