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Canada Nickel doubles financial raise for 2021 feasibility study at Crawford

Sep 15, 2020

Canada Nickel Company has amended its agreement with Echelon Wealth Partners Inc., as lead underwriter and sole bookrunner, on behalf of a syndicate of underwriters including Eight Capital and Haywood Securities Inc., to increase the size of the previously announced bought deal offering from approximately $6.5 million to approximately $13 million.  

The net proceeds from the sale will be used to fund feasibility study work through 2021 on the company's Crawford Nickel-Cobalt Sulphide Project in Timmins, to accelerate exploration on the company’s option properties, and for working capital purposes.

The underwriters have agreed to purchase, on a "bought deal" private placement basis, 5,350,000 units of the Company (the "Units") at a price of $1.50 per Unit (the “Unit Issue Price”), for total gross proceeds of $8,025,000, and 2,950,000 flow-through shares of the Company (the "FT Shares", collectively with the Units, the “Offered Securities”) at a price of $1.70 per FT Share, for total gross proceeds of $5,015,000 (the "Offering").

Each Unit will consist of one common share (a “Common Share”) in the capital of the Company and one-half of one common share purchase warrant (a “Warrant”) of the Company. Each Warrant shall be exercisable to acquire one Common Share (a “Warrant Share”) at a price per Warrant Share of $2.10 for a period of 24 months from the closing date of the Offering, subject to an accelerated expiry option whereby the Company can trigger an accelerated 30-day expiry of the Warrants if the closing price of the Company’s Common Shares listed on the TSX-V remain higher than $3.25 for 20 consecutive trading days. On the 20th consecutive trading day above $3.25 (the “Acceleration Trigger Date”), the Warrant expiry date may be accelerated to 30 trading days after the Acceleration Trigger Date by the issuance of a news release announcing such acceleration, within two trading days of the Acceleration Trigger Date.   

The gross proceeds received by the Company from the sale of the FT Shares will be used to incur Canadian Exploration Expenses (“CEE”) that are “flow-through mining expenditures” (as such terms are defined in the Income Tax Act (Canada)) on the Company’s properties in Ontario, which will be renounced to the subscribers with an effective date no later than December 31, 2020, in the aggregate amount of not less than the total amount of the gross proceeds raised from the issue of FT Shares.

The Offering is expected to close on or about September 30, 2020 and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the TSX Venture Exchange and the applicable securities regulatory authorities. The Offered Securities to be issued under the Offering will be subject to a hold period in Canada expiring four months and one day from the closing date of the Offering.

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