Cordoba Minerals Corp (TSX-V:CDB, OTCQB:CDBMF) said it has arranged a short-term loan of US$2 million with its majority shareholder Ivanhoe Electric Inc (IE).
The short-term bridge loan is evidenced on a new grid promissory note and bears interest at 12% per annum, compounding only at maturity. The interest rate will increase to 14% per annum if Cordoba does not repay the amount owing upon the maturity date, which is March 15, 2023.
The purpose of the loan is to ensure sufficient cash is available to the company to be certain it can sustain its general working capital requirements until the receipt of the US$10 million short-term loan from JCHX Mining Management Co. Ltd, which is expected to occur before the end of December 2022.
READ: Cordoba Minerals to sell 50% of Alacran project in Colombia for US$100M
This US$10 million short-term loan is part of the initial US$40 million installment from the company's joint venture arrangement for the development of the Alacran Project with JCHX.
"With the continuous support of our majority shareholder, Ivanhoe Electric, and the recently announced partnership with JCHX, we are steadily advancing the Alacran Project towards the next stage," commented Sarah Armstrong-Montoya, president and CEO of Cordoba in a statement.
The bridge loan constitutes a "related party transaction" under Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions (MI 61-101) as IE is a related party of Cordoba given its greater than 10% beneficial shareholding.
Cordoba is a mineral exploration company focused on the exploration, development and acquisition of copper and gold projects. Cordoba is developing its 100%-owned San Matias Copper-Gold-Silver Project, which includes the Alacran deposit and satellite deposits at Montiel East, Montiel West and Costa Azul, located in the Department of Cordoba, Colombia. Cordoba also holds a 51% interest in the Perseverance Copper Project in Arizona, USA, which it is exploring through a Joint Venture and Earn-In Agreement
Contact the author at jon.hopkins@proactiveinvestors.com