Cerro Grande Mining Corporation Announces Letter of Intent to acquire the Assets relating to the Pimentón Copper Gold Mining Project - Seite 2

             
(c)                If a Decision to Mine, as such concept is defined in the FQM Agreement is made, Tamidak may elect to request that FQM fund its capital contributions until commercial production of the mine has started, through a loan to Tamidak, diluting Tamidak’s participation in the JV Company to 25% and providing FQM with an extra 5% interest (75% FQM and 25% Tamidak).

(d)               Tamidak has the right to resume the exploitation of the existing Pimenton mine subject to the terms described in the FQM Agreement. 

Pursuant to the LOI, the total purchase price (the “Purchase Price”) payable under the APA for the acquisition of Tamidak’s assets relating to the Pimentón Mining Project and the rights and obligations of Tamidak under the FQM Agreement will be approximately 4,236,999,999  Chilean Pesos (approximately CDN$7,303,535 based on the nominal exchange rate of the Chilean peso to the Canadian dollar determined on July 14, 2020 as published by the Central Bank of Chile), will not be subject to adjustment after the execution of the APA, and will be payable in three equal installments as follows: (i) $1,412,333,333 Chilean Pesos (approximately CDN$2,434,511 upon execution of the APA (the “Execution Date”), payable in common shares of CEG at a price per share equal to the greater of (A) the simple average of the closing price per CEG common share on the Canadian Securities Exchange (“CSE”) for the 10 consecutive trading days ending on the date immediately prior to the date of execution of the APA; and (B) CDN$0.05 per share (or such other minimum price per share as may be in effect pursuant to the policies and rules of the CSE at the relevant time); (ii) 1,412,333,333 Chilean Pesos (approximately CDN$2,434,511) on the date that is not more than 18 months following the Execution Date, payable in cash or its equivalent in common shares of CEG, as Tamidak may elect in its sole and absolute discretion, at a price per share equal to the greater of (A) the simple average of the closing price per CEG Common Share on the CSE for the 10 consecutive trading days ending on the date immediately prior to such payment being made; and (B) CDN$0.05 per share (or such other minimum price per share as may be in effect pursuant to the policies and rules of the CSE at the relevant time); and (iii) 1,412,333,333 Chilean Pesos (approximately CDN$2,434,511)  on the date that is not more than 36 months following the Execution Date, payable in cash or its equivalent in common shares of CEG, as Tamidak may elect in its sole and absolute discretion, at a price per share equal to the greater of (A) the simple average of the closing price per CEG Common Share on the CSE for the 10 consecutive trading days ending on the date immediately prior to such payment being made; and (B) CDN$0.05 per share (or such other minimum price per share as may be in effect pursuant to the policies and rules of the CSE at the relevant time).  In case of payments to be made in shares of CEG as aforementioned, the number of CEG shares issuable shall be determined based on the nominal exchange rate of the Chilean peso to the Canadian dollar determined on the day before the applicable payment as published by the Central Bank of Chile.