Canada Nickel Closes Anglo American Investment & Bought Deal: Total Proceeds of $44 Million

Canada Nickel Company Inc. (“Canada Nickel” or the “Company”) (TSXV: CNC)
(OTCQX: CNIKF) announced that it has closed its previously-announced investments from Anglo American for aggregate gross proceeds of C$26,154,294.71 whereby Anglo American subscribed for (i) 12,569,235 common shares in the capital of the Company (“Common Shares”) at C$1.95 per Common Share, and (ii) 952,623 Common Shares at C$1.77 per Common Share (collectively, the “Anglo American
Investment”).

Upon completion of the Anglo American Investment, Anglo American will hold 9.9% of the issued and outstanding Common Shares.

The Company also concurrently closed its “bought deal” prospectus offering (the “Offering”) for aggregate gross proceeds of C$18,208,763. Under the Offering, the Company sold the following:
• an aggregate of 7,462,500 Common Shares at a price of C$1.77 per Common Share; and
• an aggregate of 1,748,300 Common Shares issued as “flow-through shares” (the “FT Shares”) within the meaning of the Income Tax Act (Canada) at a price of C$2.86 per FT Share.

The Offering was completed pursuant to an underwriting agreement dated February 14, 2023, entered into among the Company and a syndicate of underwriters led by Scotiabank, as lead underwriter and sole bookrunner, and including Red Cloud Securities Inc., Cormark Securities Inc., Echelon Wealth Partners Inc., Haywood Securities Inc., and Research Capital Corporation (collectively, the “Underwriters”).

In connection with the Offering the Underwriters received an aggregate cash commission of 6.0% of the gross proceeds of the Offering. No Commission was paid to the Underwriters in respect of the Anglo American Investment.

An amount equal to the gross proceeds from the issuance of the FT Shares will be used to incur eligible resource exploration expenses which will qualify as

(i) “Canadian exploration expenses” (as defined in the Tax Act), and

(ii) “flow-through critical mineral mining expenditures” (as defined in subsection 127(9) of the Tax Act) (collectively, the “Qualifying Expenditures”).

Qualifying Expenditures in an aggregate amount equal to the gross proceeds raised from the issuance of the FT Shares will be renounced to the initial purchasers of the FT Shares with an effective date no later than December 31, 2023.

If the Company is unable to renounce such Qualifying Expenditures, or if the Qualifying Expenditures renounced are reduced by the Canada Revenue Agency, the Company will, to the extent permitted by the Tax Act, indemnify each purchaser of FT Shares for any additional taxes payable by such purchaser as a result of the Company’s
failure to renounce the Qualifying Expenditures. 2

Use of Proceeds

The net proceeds raised from the Anglo American Investment and the sale of the Common Shares under the Offering will be used primarily for the exploration and advancement of the Company’s Crawford NickelCobalt Sulphide Project and its other Ontario properties, \ repayment of the Auramet loan facility and for general working capital purposes.

About Canada Nickel

Canada Nickel is advancing the next generation of nickel-cobalt sulphide projects to deliver nickel and cobalt required to feed the high growth electric vehicle and stainless-steel markets.

Source: Canada Nickel

Canada Nickel has successfully registered and applied for trademarks in various jurisdictions for NetZero Nickel™, NetZero Cobalt™ and NetZero Iron™ and is pursuing the development of processes to allow the production of net zero carbon nickel, cobalt, and iron products.

Canada Nickel provides investors with leverage to nickel and cobalt in low political risk jurisdictions. Canada Nickel is currently anchored by its 100% owned flagship Crawford Nickel-Cobalt Sulphide Project in the heart of the prolific Timmins-Cochrane mining camp.

Canada Nickel is a market awareness client of Capital 10X.

The opinions provided in this article are those of the author and do not constitute investment advice. Readers should assume that the author and/or employees of Capital 10X hold positions in the company or companies mentioned in the article. For more information, please see our Content Disclaimer.

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