Item 1.01 Entry into a Material Definitive Agreement.
On October 6, 2021, Purebase Corporation, a Nevada corporation (the "Company"),
entered into an amendment (the "Amendment") to its Materials Extraction
Agreement, dated May 27, 2021 (the "Agreement"), with US Mine, LLC ("US Mine"),
which Agreement was previously disclosed by the Company in the Current Report on
Form 8-K filed with the Securities and Exchange Commission ("SEC") on June 3,
2021. Pursuant to the terms of the Agreement, the rights acquired by the Company
to extract up to 100,000,000 tons of metakaolin supplementary cementitious
materials from property owned by US Mine were paid for by the issuance to US
Mine of a convertible promissory note in the principal amount of $50,000,000
(the "Note"). In accordance with the terms of the Amendment, the Note was
cancelled and the consideration for the mining rights granted to the Company was
replaced with an option entitling US Mine to purchase shares of common stock of
the Company.
Pursuant to the terms of the Common Stock Purchase Option (the "Stock Option"),
issued on October 6. 2021, US Mine has the option to purchase up to 116,000,000
shares of common stock of the Company, at an exercise price of $0.38 per share,
such exercise price being the closing price of a share of the Company's on the
OTC Markets on October 6, 2021. The Stock Option vests as to (i) the first
58,000,000 shares on April 6, 2022, (ii) an additional 29,000,000 shares on
October 6, 2022, and (iii) the remaining 29,000,000 shares on April 6, 2023. US
Mine's right to exercise the Stock Option expires on April 6, 2028.
A. Scott Dockter, the principal executive officer, and a director and
shareholder of the Company, and John Bremer, a director and shareholder of the
Company, are also manager-members of US Mine. The Company's board of directors
approved the transaction described in this Current Report on Form 8-K
("Report"), with Mr. Dockter and Mr. Bremer abstaining from providing consent
due to their interest in the transaction.
The foregoing descriptions of the Amendment and Option Agreement do not purport
to be complete and are qualified in their entirety by reference to the complete
text of the Amendment and Option Agreement, copies of which are filed with this
Report as Exhibits 10.17 and 10.18, respectively, and incorporated herein by
reference.
Item 3.02 Unregistered Sales of Equity Securities.
Reference is made to the disclosure set forth under Item 1.01 above, which
disclosure is incorporated herein by reference.
The issuance of the Stock Option was and, upon exercise of the of Stock Option,
the issuance of the shares of common stock underlying the Stock Option will be,
exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as
amended, as transactions by an issuer not involving any public offering.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. Description
10.17 Amendment to Materials Extraction Agreement, dated October 6,
2021, by and between Purebase Corporation and US Mine, LLC
10.18 Stock Option Agreement, dated October 6, 2021, issued by Purebase
Corporation to US Mine, LLC
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