Canada Nickel Completes Private Placement & Announces Agnico Eagle as an Investor

Canada Nickel Company Inc. has completed a brokered private placement consisting of 19,600,000 units of the Company at a price of C$1.77 per Flow-Through Unit, with each unit consisting of one flow-through common share of the Company and 0.35 of one flow-through common share purchase Warrant (the “Warrant”), as more particularly described below, for aggregate gross proceeds of C$34,692,000 (the "Offering").

Following closing of the Offering, Agnico Eagle Mines Limited ("Agnico Eagle") acquired the units, and as a result, holds approximately 12% of the Company's issued and outstanding common shares on a non-diluted basis, and 15.6% on a partially-diluted basis (assuming exercise of all of the Warrants).

"We are very pleased to welcome Agnico Eagle, one of the largest mining companies in Canada, as an investor in Canada Nickel.  Agnico Eagle has a long operating history in the Abitibi region, deep technical expertise and a track record of operating success with its core open pit, bulk-tonnage, gold assets in the Abitibi at both Canadian Malartic and Detour Lake.  The proceeds from this Offering will help us continue to unlock the potential of our Timmins Nickel District, which we believe has the potential to be one of the world's largest nickel sulphide district.  This potential, combined with our novel IPT Carbonation process to capture and store CO2, provides a foundation for a Zero Carbon Industrial Cluster in northern Ontario.  As well, we continue to advance various offtake initiatives which we expect to complete prior to January 18, 2024, the current repayment date for the Auramet debt facility" said Mark Selby, CEO of Canada Nickel.
 

Private Placement Offering

Pursuant to the Offering, each Flow-Through Unit consists of (i) one common share of the Company, each of which will qualify as a "flow-through share" (as defined in subsection 66(15) of the Income Tax Act (Canada) (the “Tax Act”)), and (ii) 0.35 of one purchase Warrant each of which will qualify as a "flow-through share" (as defined in subsection 66(15) of the Tax Act).  Each whole Warrant shall entitle the holder thereof to acquire one Common Share of the Company (each, a "Warrant Share") at a price of C$1.77 per Warrant Share until the date that is 36 months from the closing date of the Offering, subject to acceleration in certain circumstances.

Beginning three months from the closing date of the Offering, if the trading price of the common shares on the TSX Venture Exchange equals or exceeds C$2.65 per common share for at least 20 consecutive trading days, Canada Nickel shall have the right to accelerate, by notice to the holders of Warrants, the expiry date of the Warrants to 30 calendar days after the date of such notice (such that the holder may either exercise all or a portion of the Warrants in such 30 day period, or failing such exercise, any unexercised Warrants would expire).

All securities issued under the Offering will be subject to a hold period expiring four months and one day from the closing date of the Offering.

In addition, the Company entered into an investor rights agreement with Agnico Eagle.  Under the Investor Rights Agreement, Agnico Eagle is entitled to certain rights, provided Agnico Eagle maintains certain ownership thresholds in Canada Nickel, including: (a) the right to participate in future issuance of Common Shares (or any securities that are or may become convertible, exchangeable or exercisable into Common Shares) in order to maintain its pro rata ownership interest in Canada Nickel or acquire up to a 15.6% ownership interest, on a partially diluted basis, in Canada Nickel; and (b) the right (which Agnico Eagle has no present intention of exercising) to nominate one person to the Canada Nickel Board of Directors.

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