- Agnico Eagle subscribed for the entire flow through offering of 19.6 million shares
- Agnico Eagle is now a 12%/15.6% shareholder on a non-diluted and diluted basis.
- Announcement of future nickel offtake partners coming before January 18th.
Canada Nickel Company Inc. (TSXV:CNC) (OTCQX:CNIKF) has completed a brokered private placement consisting of 19,600,000 units of the Company (the “Flow-Through Units”) 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.
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 nondiluted basis, and 15.6% on a partially-diluted basis (assuming exercise of all of the Warrants).
Details of the Private Placement
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 “flowthrough 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 2 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.
Scotiabank acted as sole bookrunner and agent for the Offering. Scotiabank and Deutsche Bank acted as financial advisors to Canada Nickel for the Offering.
Clarification to News Release Dated December 18, 2023
Canada Nickel also makes a clarification to its news release entitled “Canada Nickel Provides Financing Update” issued on December 18, 2023 (the “Initial News Release”).
The Initial News Release stated the 350,000 common share purchase warrants(the “Extension Warrants”) issued as part of the terms to extend the US$12 million loan facility with Auramet International, Inc. had a one-year term. For clarification, the Company agreed to issue, subject to the approval of the TSX Venture Exchange, 350,000 Extension Warrants for a nine month term, with the Extension Warrants expiring on September 18, 2024. This clarification does not change the other terms related to the extension of the
loan facility or any other information reported in the Initial News Release.
The warrants and the underlying shares will be subject to a four month hold period under applicable Canadian securities laws.
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