Power Nickel Inc (TSX-V:PNPN) has announced a proposed private placement of up to 10 million flow-through (FT) units of the company, at a price of $0.50 each for aggregate gross proceeds of up to C$5 million.
The company said it intends to use the gross proceeds from the sale of the FT shares for exploration activities on the company's NISK property in Quebec and to incur eligible Canadian exploration expenses, within the meaning of the Income Tax Act (Canada), that will qualify for the federal 30% Critical Mineral Exploration Tax Credit.
Each FT unit will be composed of one common share of the company that qualifies as a flow-through share for purposes of the Income Tax Act (Canada), and one-half of one transferable non-flow-through common share purchase warrant. Each whole warrant will be exercisable into one non-flow-through common share at an exercise price of $0.50 per warrant share for a period of five years from the date of issuance.
READ: Power Nickel continues to report new productive results from Phase 2 drill program at Nisk project
The warrants will be subject to an acceleration clause which entitles the company to provide notice - to holders that the warrants will expire 30 days from the date the company provides the acceleration notice. The company can only provide the notice if the closing price of the company's common shares on the TSX Venture Exchange (TSXV) is equal to or greater than $1.00 for 10 consecutive trading days. The acceleration notice can be provided at any time after the statutory hold period and before the expiry date of the warrants.
All securities issued under the private placement will be subject to a four-month and one-day statutory hold period.
The private placement is subject to TSXV approval. The company may pay finder's fees as permitted by applicable securities laws and the rules of the TSXV.
Power Nickel is a Canadian junior exploration company focusing on high-potential copper, gold, and battery metal prospects in Canada and Chile.
On February 1, 2021, Power Nickel (then called Chilean Metals) completed the acquisition of its option to acquire up to 80% of the Nisk project from Critical Elements Lithium Corp.
The NISK property comprises a large land position (20 kilometers of strike length) with numerous high-grade intercepts. Power Nickel is focused on expanding its current high-grade nickel-copper PGE mineralization Ni 43- 101 resource with a series of drill programs designed to test the initial Nisk discovery zone and to explore the land package for adjacent potential Nickel deposits.
Contact the author at jon.hopkins@proactiveinvestors.com