Canada Nickel Closes Upsized Flow-Through Share Placement & Provides Loan Facility Update

Canada Nickel has closed a non-brokered private placement of 3,000,000 flow-through shares (FTS) at C$2.07 per share for aggregate gross proceeds of C$6,210,000, upsized from its originally announced size due to strong investor demand. Proceeds will fund qualifying expenditures (QE) at the Crawford Nickel-Cobalt Sulphide Project, with at least 90.34% required to qualify as flow-through critical mineral mining expenditures under the federal Income Tax Act (Canada), and renunciation to initial purchasers carrying an effective date no later than December 31, 2026. Separately, the company clarified that the interest rate on its US$32 million loan facility with Auramet International, Inc. has been amended to 15% per annum in connection with a previously announced extension of the maturity date.

Company Overview

Canada Nickel Company Inc. (TSXV: CNC | OTCQX: CNIKF) is advancing the next generation of nickel-sulphide projects to supply nickel for the electric vehicle and stainless steel markets. The company is anchored by its 100%-owned flagship Crawford Nickel-Cobalt Sulphide Project, located in the Timmins-Cochrane nickel district of Ontario. Canada Nickel is pursuing the development of processes to enable the production of net-zero carbon nickel, cobalt, and iron products, and has applied in multiple jurisdictions to trademark the terms NetZero Nickel, NetZero Cobalt, and NetZero Iron.

The Offering: Size & Structure

Canada Nickel completed a non-brokered private placement on June 10, 2026, issuing 3,000,000 common shares structured as flow-through shares as defined under subsection 66(15) of the Income Tax Act (Canada). The shares were priced at C$2.07 per flow-through share (FTS), generating aggregate gross proceeds of C$6,210,000. The company stated that the offering was upsized from its previously announced size due to strong investor demand, indicating robust appetite from the Canadian resource investor community for the tax-advantaged structure.

The FTS are subject to a hold period expiring four months and one day from the issue date, consistent with applicable Canadian securities laws. Final approval of the TSX Venture Exchange remains outstanding.

Use of Proceeds & Tax Treatment

The gross proceeds will be directed entirely toward qualifying expenditures (QE) that meet multiple criteria under Canadian federal and Ontario provincial tax legislation. Under the federal Income Tax Act (Canada), at least 90.34% of gross proceeds must qualify as flow-through critical mineral mining expenditures as defined under subsection 127(9), with the remainder of up to 9.66% qualifying as flow-through mining expenditures under the same subsection. All proceeds are required to qualify as Canadian exploration expenses.

At the provincial level, expenditures must qualify as either eligible Ontario critical mineral exploration expenditures under subsection 103(4.1) of the Taxation Act, 2007 (Ontario) or as eligible Ontario exploration expenditures under subsection 103(4) of the same Act. The dual-layer federal and Ontario tax treatment is significant for Canadian investors, as it enables deductions at both levels against applicable income, an outcome that structurally differentiates flow-through financings from conventional equity issuances.

QE in an aggregate amount no less than the gross proceeds raised will be incurred or deemed to be incurred by the company on or before December 31, 2027. Renunciation to the initial purchasers of the FTS will carry an effective date no later than December 31, 2026.

Auramet Loan Facility: Interest Rate Clarification

In conjunction with the closing, Canada Nickel provided a clarification regarding its previously announced US$32 million loan facility with Auramet International, Inc. In connection with the previously announced extension of the facility's maturity date, the facility's interest rate has been amended to 15% per annum. The company did not disclose a revised maturity date in this release, noting only that this clarification pertains to the terms associated with the earlier extension announcement.

The amended interest rate is a relevant data point for investors assessing the company's cost of capital and near-term financing obligations as it advances the Crawford project toward its next development milestones.

Next Steps

Based solely on the press release, the company's near-term milestones are as follows: Final approval of the TSX Venture Exchange for the offering is pending and represents the immediate regulatory step before the placement is formally closed in all respects. On the expenditure side, the company is required to incur or be deemed to incur QE totalling no less than C$6,210,000 on or before December 31, 2027. Renunciation of those expenditures to initial purchasers by the company must be effective no later than December 31, 2026, establishing a firm calendar marker for the company's exploration spending programme at Crawford.