First Phosphate Corp. (CSE:PHOS, OTCQB:FRSPF), the Quebec-based mineral development firm, plans to raise at least $2 million in a private share placement to a strategic investor, aiming to support exploration work and general corporate activities.
The offering will follow the structure of a similar fundraising in May that was initially pitched at $1 million but ultimately pulled in more than three times that amount. That earlier raise closed in two tranches at the end of May and early June.
Shares will be sold at $0.35 apiece. Investors can choose between flow-through shares and conventional "hard dollar" units. The latter come with warrants allowing the purchase of additional shares at $0.50 until the end of the year.
Flow-through shares are a common feature of Canadian junior mining finance. They allow investors to claim tax deductions based on the company’s qualifying exploration expenditures, offering a financial incentive to back early-stage resource projects.
Proceeds from the flow-through component will be used for exploration expenses that qualify under Canadian tax law.
The hard dollar funds, by contrast, can also be used for working capital and other corporate purposes.
The placement is set to close by July 8, though it may be completed in more than one tranche.
First Phosphate is focused on developing high-purity phosphate for use in lithium iron phosphate (LFP) batteries, with its flagship Bégin-Lamarche project located in Saguenay-Lac-Saint-Jean.