Québec Nickel Corp. (CSE: QNI) is arranging a private placement of: (i) up to $5 million of units at a price of $0.20 per unit; and (ii) up to $2 million of flow-through shares (each, a “FT Share”) at a price of $0.24 per FT share and up to $3 million Québec flow-through shares (each a Québec FT Share), at a price of $0.25 per Québec FT Share for maximum aggregate gross proceeds of up to $10,000,000 (the “Offering”). The Offering is being led by EMD Financial Inc.
Each Unit will be comprised of one common share (Common Share) in the capital of the company and one-half of common share purchase warrant of the company. Each whole warrant will entitle the holder thereof to acquire one additional common share at a price of $0.30 for a period of two years for the closing date of the offering. The FT Shares and Québec FT Shares will qualify as “flow-through shares” within the meaning of subsection 66(15) of the Income Tax Act (Canada).
The net proceeds from the issuance of the Units will be used for general working capital purposes. The gross proceeds from the issuance of the FT Shares and Québec FT Shares will be used for Canadian exploration expenses and will qualify as “flow-through mining expenditures”, as defined in subsection 127(9) of the Income Tax Act (Canada) and under section 359.1 of the Taxation Act (Québec) (the “Qualifying Expenditures”), which will be incurred on or before December 31, 2023 and renounced to the subscribers with an effective date no later than December 31, 2022 in an aggregate amount not less than the gross proceeds raised from the issue of the FT Shares and Québec FT Shares, as the case may be.
In addition, with respect to Québec resident subscribers of Québec FT Shares and who are eligible individuals under the Taxation Act (Québec), the Canadian exploration expenses will also qualify for inclusion in the “exploration base relating to certain Québec exploration expenses” within the meaning of section 726.4.10 of the Taxation Act (Québec) and for inclusion in the “exploration base relating to certain Québec surface mining expenses or oil and gas exploration expenses” within the meaning of section 7188.8.131.52 of the Taxation Act (Québec).
In connection with the Offering, the Company will pay finder’s fees and issue finder warrants to EMD Financial Inc. as well as any other registrants participating in the Offering consisting of: (i) cash finder’s fees of up to 6% of the gross proceeds of the Offering; and (ii) finder warrants in an amount equal to up to 6% of the number of Units, FT Shares and QC FT Shares issued pursuant to the Offering, exercisable at a price of $0.30 per Common Share for a period of two (2) years following the Closing Date.
The Units offered as a part of the Offering shall be offered (i) pursuant to applicable prospectus exemptions in accordance with National Instrument 45-106 – Prospectus Exemptions or in Québec pursuant to Regulation 45-106 – Prospectus Exemptions (collectively, “NI 45-106”), and (ii) 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”). The Company may issue up to an aggregate of 22,500,000 Units for maximum aggregate gross proceeds of $4,500,000 under the Listed Issuer Financing Exemption.
Units offered under the Listed Issuer Financing Exemption will not be subject to resale restrictions pursuant to applicable Canadian securities laws. All other securities issued pursuant to the Offering will be subject to the statutory hold period of four months and one day from the date of issuance in accordance with applicable Canadian securities laws.
There is an offering document related to the Offering that can be accessed under the Company’s profile at www.sedar.com and on the Company’s website at www.quebecnickel.com. Prospective investors should read this offering document before making an investment decision.
The Offering is anticipated to close on or about December 8, 2022, or such later date as the Company may determine. The closing is subject to certain conditions including, but not limited to, the receipt of all necessary regulatory and other approvals, including the approval of the Canadians Securities Exchange (CSE).
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