Québec Nickel Corp. (CSE: QNI) announced that it has completed the closing of a first tranche of its brokered private placement (the “First Tranche”) by issuing a total of: (i) 9,575,000 units (each a “Unit”), at a price of $0.20 per Unit; (ii) 4,433,367 national flow-through shares (each, a “National FT Share”), at a price of $0.24 per National FT Share; and (iii) 10,612,000 Quebec flow-through shares (each, a “Quebec FT Share”), at a price of $0.25 per Quebec FT Share. The aggregate gross proceeds raised from the First Tranche is $5,632,008.08.
All National FT Shares and QC FT Shares issued in the private placement are subject to a four-month hold period expiring on April 10, 2023. Of the Units issued, a total of 4,900,000 were issued pursuant to applicable prospectus exemptions in accordance with National Instrument 45-106 – Prospectus Exemptions or in Québec pursuant to Regulation 45-106 – respecting Prospectus Exemptions (collectively, “NI 45-106”) and are also subject to a four-month hold period expiring on April 10, 2023. The balance of 4,675,000 Units were issued to purchasers’ resident in all provinces of Canada, except Québec, pursuant to the listed issuer financing exemption under Part 5A of NI 45-106 (the “Listed Issuer Financing Exemption”).
Each Unit is comprised of one common share (“Common Share”) in the capital of the Company and one-half (1/2) of a Common Share purchase warrant (“Warrant”) of the Company. Each whole Warrant entitles the holder thereof to acquire one additional Common Share at a price of $0.30 for a period of two (2) years from the closing date (the “Closing Date”) of the First Tranche. The National FT Shares and the Quebec FT Shares will qualify as “flow-through shares” within the meaning of subsection 66(15) of the Income Tax Act (Canada).
Québec Nickel will use the private placement proceeds from the Units for general working capital and exploration purposes and will use the proceeds from the National FT Shares and the Quebec FT Shares exclusively to fund exploration work on its properties located in the Province of Québec.
The company is pleased to have received support and participation from its existing shareholders in the private placement. David Patterson, CEO further acknowledges the new participation and support from three Quebec-based institutional funds for this financing, SIDEX L.P., Société de Développement de la Baie-James and CDPQ. “This demonstrates why Quebec is consistently ranked as one of the best places for mineral exploration.” The Company would like to thank all participants to the financing.
As a result of the closing of the private placement, there are now 98,307,205 common shares of the Company issued and outstanding. The private placement is subject to final acceptance by the Canadian Securities Exchange.
The private placement was led by a syndicate of agents, with EMD Financial Inc. acting as sole bookrunner and including Canaccord Genuity Corp. (collectively, the “Agents“). In connection with the private placement, the Agents received a $298,720 cash commission and 1,477,222 non-transferable compensation options (each, a “Compensation Option”). Each Compensation Option entitles the holder thereof to acquire one Common Share at a price of $0.30 until December 9, 2024.
The insiders’ (“Insiders”) participation for $260,000.08 is exempt from the formal valuation and minority shareholder approval requirements provided under Regulation 61-101 respecting Protection of Minority Security Holders in Special Transactions (“Regulation 61-101”) in accordance with Sections 5.5(a) and 5.7(1)(a) of Regulation 61-101. The exemption is due to the fact that neither the fair market value of the private placement, nor the consideration paid by such Insiders exceeds 25% of the market capitalization of the Company.
The Company may close a second tranche of its private placement on or before December 29, 2022.
