Also, Ferro Iron Ore reached a definitive agreement to get the remaining 22.5% interest in the Exploration License through a business combination with another BVI-registered entity, Blue Eagle Trading Limited.
Continent Treasure Limited holds a 77.5% shareholding interest in Accuracy Trade Limited, a British Virgin Islands company that owns 100% of Khandgait Mining LLC, a Mongolian legal entity, which, in turn, owns 100% of Khandgait Gol LLC, a Mongolian legal entity that holds the Exploration License. The remaining 22.5% shareholding interest in ATL is owned by Blue Eagle, also a British Virgin Islands company. The principal shareholders of Continent Treasure Limited are Infinity Eagle Limited, Treasure Carriage Limited, Barlow Lake Limited, and Oceanward Limited, all of which are British Virgin Islands companies.
Under the TSX Venture Exchange Policy, the proposed business combinations will represent a reverse takeover for Ferro Iron Ore and are considered arm's length transactions.
Pursuant to the terms of these business combinations, Ferro Iron Ore will pay $250,000 cash and issue a number of common shares, which will result in a change of control of the company. Also, the Company intends to complete an equity financing to raise approximately $2.85 million. The financing is expected to be completed by issuing approximately 11,400,000 common shares at a price of $0.25 per share. It will also issue 2,100,000 common shares as a finder's fee in connection with the Proposed Business Combinations.
Following the proposed business transactions and the financing, the shareholders of CTL, Blue Eagle, and parties related to the shareholders of CTL who participate in the Financing will own approximately 68.3% of issued and outstanding common shares.