Canada Nickel Secures $34.7M as Agnico Eagle Takes 12% Stake to Advance Timmins Nickel Projects

• Canada Nickel raised $34.69M through a private placement of flow-through units
• Agnico Eagle participated, acquiring 12% stake; expands to 15.6% partially-diluted
• Proceeds to advance Timmins nickel project and zero carbon initiatives
• Partnership provides technical/operating expertise as Canada Nickel advances projects
• Recent financing deals position Canada Nickel well with strong shareholder base

Canada Nickel Company Inc. (TSXV: CNC) has closed a $34.7 million private placement to advance exploration and development initiatives at its Timmins nickel project. The placement was strongly supported by one of Canada's largest gold miners, Agnico Eagle Mines Limited, which acquired units to hold a 12% stake in Canada Nickel.

About Canada Nickel Company

Canada Nickel Company Inc. is a Canadian nickel exploration and development company focused on nickel sulphide projects to supply the electric vehicle and stainless steel markets. The company is advancing its 100% owned flagship Crawford Nickel-Cobalt Sulphide Project in Timmins, Ontario. It has also applied to trademark NetZero Nickel, NetZero Cobalt and NetZero Iron as it pursues zero carbon production methods.

$34.69 Million Private Placement

On January 2, 2024, Canada Nickel announced the closing of a $34.69 million flow-through private placement. The company issued 19.6 million flow-through units at a price of $1.77 per unit.

Each unit consists of one flow-through common share and 0.35 of a warrant. Each whole warrant entitles the holder to acquire one common share at $1.77 for 36 months following close. The warrants are subject to an acceleration clause should the share price trade above $2.65 for a period.

The flow-through shares and warrants qualify under the Tax Act rules and provide investors with enhanced tax incentives for investing in resource exploration companies in Canada.

The deal was completed on a brokered, private placement basis with Scotiabank acting as the sole bookrunner and agent. Scotiabank and Deutsche Bank also acted as Canada Nickel's financial advisors on the placement.

Agnico Eagle Partnership

A key component of the placement was the participation of Agnico Eagle Mines as lead investor. Agnico Eagle acquired units to build a 12% ownership position in Canada Nickel. Assuming full exercise of the warrants, Agnico would hold 15.6% of Canada Nickel's shares on a partially diluted basis.

Agnico Eagle has committed over $4 million to Canada Nickel to help advance the Timmins area nickel projects. Agnico Eagle is one of the largest gold producers in Canada and operates several mines in the Abitibi region near Timmins. It has extensive regional expertise as an open pit and underground operator.

The partnership provides Canada Nickel with a knowledgeable partner to provide technical guidance and input as it advances the Timmins nickel projects and zero carbon initiatives.

In connection with its investment, Agnico Eagle has been granted certain shareholder rights. This includes anti-dilution rights to participate in future financings as well as board nomination rights. However, Agnico has no present plans to exercise board nomination rights.

Use of Proceeds

Canada Nickel plans to use the $34.69 million in proceeds from the placement to continue exploration and unlock additional value at its Timmins nickel project. The company believes the project has potential to be one of the world's largest nickel sulphide districts.

The funding will also support ongoing development of the company's innovative IPT carbonation process to capture and store carbon dioxide. This supports Canada Nickel's zero carbon plans for a potential Timmins zero carbon industrial cluster.

The company also has several potential offtake agreements in the works that could provide a base level of cash flow as the projects advance. Any offtakes would help supplement funding for development programs.

Conclusion

Between the recent private placement and the new partnership with Agnico Eagle Mines, Canada Nickel has positioned itself well entering 2024. The company has strengthened its shareholder base and cash position with over $34 million to aggressively explore and de-risk its nickel projects over the coming year. The involvement of Agnico Eagle also provides investors with technical validation and operating expertise as an experienced regional partner.

While still an early stage explorer, Canada Nickel offers investors nickel exposure aimed at supplying the surging battery metals space. Its large district-scale nickel project stands out among juniors. The company's plan to develop a zero carbon operation also resonates well with ESG-focused investors. The strategic Agnico Eagle partnership further derisks execution capabilities.

With exploration results pending and potential offtake deals in the works, 2024 is shaping up as an important year for Canada Nickel to demonstrate additional project value as it works to establish itself as a leading next-gen nickel developer.