Cornish Metals conditionally raises 8.2 million pounds Cornish Metals conditionally raises 8.2 million pounds
2021-02-05 16:27 ET - News Release
Mr. Richard Williams reports
CORNISH METALS INC. ANNOUNCES OVERSUBSCRIBED 8 MILLION POUND STERLING PLACING AND SUPPLEMENTARY 206,000 POUND STERLING SUBSCRIPTION FUNDING VIA MINEXIA LIMITED
Further to the announcement on Jan. 13, 2021, Cornish Metals Inc. has conditionally raised 8.0 million pounds sterling through a placing and subscription of common shares with new and existing investors, and an additional investment of approximately 206,000 pounds sterling through an offer to high-net-worth investors by Minexia Ltd., representing an aggregate 8.2 million pounds sterling (approximately $14.37-million based on the Feb. 4, 2021, exchange rate).
Completion of the Placing and Subscription is subject to certain conditions, including the admission of the Company's common shares (the "Common Shares") to trading on the AIM Market ("AIM") of the London Stock Exchange (the "Admission") and the receipt of all necessary regulatory approvals, including the conditional approval of the TSX Venture Exchange (the "TSX-V").
Highlights
- The oversubscribed Placing and Subscription comprises subscriptions for a total of 117,226,572 Common Shares of the Company (the "New Common Shares") at a price of 7 pence per share, or 12 Canadian cents per share, raising gross proceeds of pounds sterling8.2 million (or approximately C$14.37 million).
- The net proceeds of the Placing and Subscription is expected be used to advance the United Downs copper-tin project in Cornwall, United Kingdom ("United Downs"), conduct initial field work on other high priority exploration targets, and general working capital.
- Subject to completion of the Placing and Subscription, the Company expects to commence a drill programme at United Downs in late March or early April, 2021.
- Certain directors of the Company will also participate in the Placing.
- Subject to completion of the Placing and Subscription, the New Common Shares would represent approximately 43.9 per cent of the Company's enlarged share capital.
Richard Williams, CEO of the Company, stated "We would like to welcome our new shareholders on this next phase of the Company's growth. The support from UK investors has been extremely encouraging and reinforces our belief that exposure to the UK investment community by listing on AIM is an important milestone.
"We are pleased to get to work on our projects in Cornwall and look forward to working with all stakeholders as we look to contribute to the UK's desire to achieve a carbon neutral economy and expand the domestic supply of materials important to the battery and technology sectors."
S.P. Angel Corporate Finance LLP ("SP Angel") is acting as Nomad and Broker and H & P Advisory Limited ("H&P") is acting as Joint Broker to the Company (collectively, the "Joint Brokers") in connection with the Placing and Admission. Subject to completion of the Placing, including approval of the TSX-V, the Company expects to pay in cash: (i) a five per cent commission to each of the Joint Brokers in respect of certain investors introduced by the relevant Joint Broker; (ii) a one half of one per cent commission to SP Angel in respect of certain investors introduced by H&P who utilize SP Angel's CREST stock account on completion of the Placing; and (iii) a one per cent commission to SP Angel in respect of certain investors participating in the Placing other than those introduced by the Joint Brokers who utilize SP Angel's CREST stock account on completion of the Fundraising. The Company is also expected to pay certain corporate finance fees to each of the Joint Brokers. In addition, investors introduced by Minexia Limited ("Minexia") agreed to subscribe for pounds sterling205,860 of the Subscription for which the Company is expected to pay a five per cent commission in cash to Minexia, subject to completion of the Placing and Subscription.
Subject to receipt of all necessary regulatory approvals, including the approval of the TSX-V, the Placing and Subscription is expected to close on or about February 16, 2021.
Admission to AIM
Application will be made for the Company's enlarged share capital to be admitted to trading on AIM. Admission is expected to become effective and dealings in the Common Shares will commence on AIM from 8 a.m. GMT on February 16, 2021 ("Admission"), with shares trading under the symbol "CUSN".
The Placing and Subscription is conditional, amongst other things, on obtaining the conditional approval of the TSX-V, and on Admission taking place on or before February 26, 2021 and on the placing agreement that has been entered into between, among others, the Company and the Joint Brokers becoming unconditional and not being terminated prior to Admission.
The New Common Shares will be issued credited as fully paid and will, on issue, rank pari passu in all respects with the existing Common Shares, including the right to receive all dividends and other distributions thereafter declared, made or paid on the enlarged share capital from Admission.
Such New Common Shares: (i) have not been qualified for distribution by prospectus in Canada, and (ii) may not be offered or sold in Canada during the course of their distribution except pursuant to a Canadian prospectus or in reliance on an available prospectus exemption. Subject to completion of the Placing and Subscription, all New Common Shares to be issued as part of this Placing and Subscription would be subject to a hold period of four months and one day in Canada from the date of their issuance in accordance with applicable Canadian securities legislation. Under applicable Canadian securities legislation, such hold period will only apply to trades (as defined under applicable Canadian securities legislation) of the New Common Shares in Canada.
Publication of the AIM admission document
The Company expects to publish its AIM admission document in relation to the Admission on the Company's website on or about February 10, 2021.
Expected Timetable of Principal Events (subject to receipt of all necessary regulatory approvals, including conditional approval of the TSX-V)
Publication of Admission Document February 10, 2021 Admission of Common Shares and Dealings Commence on AIM February 16, 2021
Related Party Transactions
The Company advises that Richard Williams, Director, President and CEO, Grenville Thomas, Director, and Don Njegovan, Director (collectively, the "Interested Directors") have agreed to subscribe for New Common Shares under the Placing. As such, the Placing will constitute a "related party transaction" within the meaning of Policy 5.9 of the TSX-V and Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101") as a result of such Interested Directors being Directors of the Company.
Related party transactions require a formal valuation and minority shareholder approval unless exemptions from these requirements are available under applicable Canadian securities laws.
In connection with the Placing, the Company is relying on the exemption from the formal valuation requirement in section 5.5(b) of MI 61-101 (as a result of the Common Shares being listed on the TSX-V and, upon Admission, on AIM). With respect to an exemption from the minority approval requirement in connection with the Placing, the Company is relying on the exemption in section 5.7(1)(b) of MI 61-101 (as neither the fair market value of the Common Shares which may be distributed to, nor the consideration which may be paid by, the Interested Directors will exceed $2,500,000).
Further details in respect of the Placing and Subscription will be included in a material change report to be filed by the Company. The material change report will be filed less than 21 days prior to closing of the Placing and Subscription due to the timing of the announcement of the Placing and Subscription and the Company wishes to complete the Placing and Subscription in an expeditious manner.
About Cornish Metals Inc.
Cornish Metals (formerly Strongbow Exploration Inc.) completed the acquisition of the South Crofty tin and United Downs copper / tin projects, plus additional mineral rights located in Cornwall, UK, in July 2016 (see Company news release dated July 12, 2016). The additional mineral rights cover an area of approximately 15,000 hectares and are distributed throughout Cornwall. Some of these mineral rights cover old mines that were historically worked for copper, tin, zinc, and tungsten.
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