Clean Air Metals Inc (TSX-V:AIR, OTCQB:CLRMF) said it has entered into an agreement with Paradigm Capital Inc, on behalf of a syndicate of agents, in connection with a 'best efforts' private placement financing for gross proceeds of up to $12.5 million.
The deal was upsized from $9 million, announced earlier.
The private placement will consist of up to 23,150,400 flow-through (FT) units, of which 10,869,600 will be issued at a price of $0.23 per FT unit and 12,280,800 of which will be issued at a price of $0.285, plus 32,250,000 non-flow-through units at a price of $0.20 per unit.
Each FT Unit will consist of one common share of the company and one common share purchase warrant that will each qualify as a flow-through share within the meaning of subsection 66(15) of the Income Tax Act (Canada).
Each unit will consist of one non-flow-through common share of the company and one warrant. Each warrant will entitle the holder to acquire one common share of the company at a price of $0.25 for a period of 2 years following the closing of the offering.
READ: Clean Air Metals hails publication of its ESG report related to its Thunder Bay North project in Ontario
In addition, the company will grant the agent an option to sell that number of additional FT units for additional aggregate gross proceeds of up to $1 million exercisable 48 hours prior to the closing date.
Michael Gentile, a leading strategic investor in the junior mining sector, will purchase $1.5 million of the units as part of the offering.
The company said it will use an amount equal to the gross proceeds received from the sale of the FT Units to incur eligible 'Canadian exploration expenses' that will qualify as 'flow-through mining expenditures' as such terms are defined in the Income Tax Act (Canada) related to the company's projects in Ontario. All Qualifying Expenditures will be renounced in favour of the subscribers of the FT units effective December 31, 2022.
The offering is expected to close on or about February 23, 2022, and is subject to certain closing conditions including, but not limited to, the receipt of all necessary approvals including the conditional listing approval of the TSX Venture Exchange and the applicable securities regulatory authorities.
The securities offered have not been registered under the US Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.
Clean Air Metals' flagship asset is the 100% owned, high-grade Thunder Bay North Project, a platinum, palladium, copper, nickel project located near the City of Thunder Bay, Ontario and the Lac des Iles Mine owned by Impala Platinum.
The Thunder Bay North Project hosts the twin magma conduit bodies which host Current and Escape deposits forming the basis for a positive preliminary economic assessment around a ramp access underground mine reported December 1, 2021.
--Updated with upsized amount--
Contact the author at jon.hopkins@proactiveinvestors.com