Clean Air Metals arranges $10-million bought deal

Feb 1, 2021

2021-02-01 16:54 ET – News Release

Mr. Abraham Drost reports

CLEAN AIR METALS ANNOUNCES $10 MILLION BOUGHT DEAL PRIVATE PLACEMENT

Clean Air Metals Inc. has entered into an agreement with Paradigm Capital Inc. on behalf of a syndicate of underwriters in connection with a bought deal private placement financing for total proceeds of $10-million, consisting of (i) 11,904,800 flow-through shares at a price of 42 cents per FT share and (ii) 9,804,000 flow-through units at a price of 51 cents per FT unit.

Each FT unit will consist of one common share of the company and one-half of 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 warrant will entitle the holder thereof to acquire one common share of the company at a price of 55 cents for a period of two years following the closing of the offering.

In addition, the company will grant the underwriters an option to purchase that number of additional FT shares at the FT share issue price and/or FT units at the FT unit issue price, for additional aggregate gross proceeds of up to $1.5-million, exercisable 48 hours prior to the closing date.

Abraham Drost, PGeo, chief executive officer of Clean Air Metals, commented: “The bought deal flow-through financing will allow the company to execute with a strong follow-up exploration program for 2021 in light of the new resource statement released on Jan. 20, 2021. We are grateful to Paradigm Capital and syndicate partners for their support in these volatile markets.”

The company will use an amount equal to the gross proceeds received by the company from the sale of the FT shares and 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 Canada. All qualifying expenditures will be renounced in favour of the subscribers of the FT shares and FT units effective Dec. 31, 2021.

The underwriters will receive a cash fee of 6 per cent of the gross proceeds from the sale of the offered securities, other than in respect of sales to subscribers on the president’s list, in which case the cash commission will be reduced to 3 per cent.

The underwriter will also receive compensation options entitling the underwriter, from time to time for a period of two years from the closing date of the offering, to acquire that number of common shares of the company that is equal to 5 per cent of the number of offered securities issued pursuant to the offering (other than any offered securities issued to subscribers on the president’s list in which case it will be reduced to 2.5 per cent), at an exercise price equal to the FT share issue price.

The offering is expected to close on or about Feb. 23, 2021, 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 offered securities and the shares issuable upon the exercise of the compensation options will be subject to a four month hold period under applicable Canadian securities laws.

About Clean Air Metals Inc.

Clean Air Metals’ flagship asset is the Thunder Bay North project, a platinum, palladium, copper, nickel project located near the city of Thunder Bay, Ont., and the Lac des Iles mine owned by Impala Platinum Holdings. The Clean Air Metals project hosts the Current Lake deposit and magma conduit, and the company is actively exploring the Escape Lake deposit, a twin structure to the Current Lake deposit. Executive chairman Jim Gallagher, PEng, and chief executive officer Abraham Drost, PGeo, led an experienced team of geologists and engineers who are using the Norilsk magma conduit stratigraphic and mineral deposit model to guide ongoing exploration and development studies. As the former CEO of North American Palladium Ltd., which owned the Lac des Iles mine prior to the sale to Impala Platinum in December, 2019, Mr. Gallagher and team are credited with the mine turnaround and creation of significant value for shareholders.

We seek Safe Harbor.

https://www.cleanairmetals.ca/