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The Company has filed a Filing Statement on SEDAR which discloses the details of the proposed acquisition and the private placement arranged in connection with the acquisition. Further to its press release of September 14, 2009, Cortez has amended the terms of the previously announced private placement. As disclosed in its Filing Statement, Cortez is completing a non-brokered private placement of a minimum of $5 million up to a maximum of $7 million through the issuance of up to 14,000,000 units at a price of $0.50 per unit. Each unit is comprised of 1 common share of Cortez and one-half (1/2) of one non-transferable common share purchase warrant ("Warrant"). Each whole Warrant is exercisable for a period of two years from the date of issue and will entitle to holder to purchase one (1) common share at a price of $0.70 per share. A finder's fee will apply in this financing, pursuant to regulatory policies.
The primary use of funds will be to make the US$2.9 million cash portion of the final payment under the definitive asset purchase agreement with Seabridge (the "Definitive Agreement"). In addition to payment of the consideration to Seabridge, the private placement funds will be added to working capital and will be used to conduct the first phase of the recommended work program on the Castle Black-Rock Property and to evaluate the remainder of the Nevada portfolio. Any securities issued by the Company pursuant to the private placement or the Definitive Agreement will be subject to a four month hold period from the date of their issue.
The Closing Date for the Proposed Acquisition will occur immediately after satisfaction of all of the conditions set out in the Exchange's conditional approval letter. Cortez has obtained a further extension from Seabridge to the deadline for completing the Proposed Acquisition. The Definitive Agreement entered into by Seabridge and Cortez has now been amended to reflect the parties' agreement to extend the deadline for the Acquisition to November 27, 2009. Cortez expects to satisfy the conditions to the Exchange approval during this period.
Upon closing, William Threlkeld and William Sheriff will be appointed additional directors of the Company. For a description of Mr. Threlkeld's and Mr. Sheriff's work experience, please refer to the Company's news release of March 26, 2009 and the Filing Statement. Upon completion of the transactions and required filings with the TSX Venture Exchange, the Company will be listed as a Tier 2 Mining Issuer.
The Company's Filing Statement and the Technical Report on the Castle Black-Rock Property can be viewed on www.sedar.com.
Cortez is a capital pool company and the Acquisition will constitute its Qualifying Transaction (as such term is defined in the policies of the Exchange). The Acquisition is an arm's length transaction and upon completion of the Proposed Acquisition, Cortez expects to be a Tier 2 Mineral Exploration Issuer. No Non-Arm's Length Party (as defined in the policies of the Exchange) to Cortez has any direct or indirect beneficial interest in the Properties or the shares of Seabridge.
Description of Significant Conditions to Closing
Pursuant to Section 2.1 of Exchange policies, as the proposed Qualifying Transaction is not a Non-Arms Length Qualifying Transaction, the Company will not be required to obtain shareholder approval of the Qualifying Transaction. Sponsorship for this Qualifying Transaction is not required under the policies of the Exchange.
The remaining conditions to closing the Acquisition include: (i) completion of the minimum private placement amount; and (ii) confirmation of a minimum of 200 shareholders each holding a board lot free of resale restrictions. Until these conditions are met, there can be no assurance that the transaction will be completed as proposed or at all.
ON BEHALF OF THE BOARD of Cortez Gold Corp.
Robert Eadie, President & Chief Executive Officer
SOURCE: Cortez Gold Corp.
Cortez Gold Corp. Robert Eadie President and CEO (604) 602-4935 (604) 602-4936 (FAX) info@cortezgold.com
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