Toronto, Ontario–(Newsfile Corp. – April 8, 2022) – 1287390 B.C. Ltd. (“390“) and NiCAN Limited (“NiCAN“) are pleased to announce that further to the news release of 390 dated March 3, 2022, NiCAN has successfully closed the previously-announced non-brokered private placement (the “Concurrent Offering“) of 14,483,446 Subscription Receipts (as defined below), for gross proceeds of $6,108,675.70.

The Concurrent Offering was completed as part of the proposed business combination (the “Transaction“) between 390 and NiCAN. NiCAN and 390 entered into an amalgamation agreement dated March 3, 2022 (the “Definitive Agreement“), whereby 390 will amalgamate with NiCAN (the “Amalgamation“) and continue as one corporation being the “Resulting Issuer“. Upon completion of the Transaction, the Resulting Issuer (to be named “NiCAN Limited“) will carry on the business of NiCAN and the securityholders of NiCAN and 390 will become securityholders of the Resulting Issuer.

The oversubscribed Concurrent Offering consisted of the issuance of (i) 8,177,500 non flow-through subscription receipts of NiCAN (the “HD Subscription Receipts“) at a price of $0.40 per HD Subscription Receipt; and (ii) 6,305,946 flow-through subscription receipts (the “FT Subscription Receipts” and together with the HD Subscription Receipts, the “Subscription Receipts“) at a price of $0.45 per FT Subscription Receipt. The Subscription Receipts were issued pursuant to and are governed by a subscription receipt agreement dated March 30, 2022 (the “Subscription Receipt Agreement“), between 390, NiCAN and TSX Trust Company, as subscription receipt agent and escrow agent.

It is expected that each HD Subscription Receipt will be, in accordance with the Subscription Receipt Agreement (as defined below), automatically converted, without payment of any additional consideration and without any further action on the part of the holder thereof, for one common share of NiCAN (each a “Common Share“). It is expected that each FT Subscription Receipt will be, in accordance with the Subscription Receipt Agreement, automatically converted, without payment of any additional consideration and without any further action on the part of the holder thereof, for one Common Share, issued on a “flow-through basis” (each, a “FT Share“) upon satisfaction of the escrow release conditions contained in the Subscription Receipt Agreement. The FT Shares will qualify as “flow-through shares” within the meaning of the Income Tax Act (Canada) (the “Tax Act“). Immediately prior to the Amalgamation, the Subscription Receipts are expected to convert into Common Shares and FT Shares which will subsequently be exchanged pursuant to the Amalgamation Agreement for shares of the Resulting Issuer (the “Resulting Issuer Shares“) on the basis of one Resulting Issuer Share for each Common Share and FT Share so held, respectively.

In connection with the Concurrent Offering, NiCAN paid certain eligible persons (the “Finders“) a finder’s fee equal to 6.0% of the aggregate gross proceeds of the subscribers participating in the Concurrent Offering introduced by such Finders (the “Finder’s Fees“). As additional consideration, NiCAN issued an aggregate of 403,627 finder’s warrants (the “Finder’s Warrants“) to the Finders, being equal to 6.0% of the aggregate number of Subscription Receipts issued pursuant to the Concurrent Offering to the subscribers introduced by each such Finder. Each Finder’s Warrant entitles the holder thereof to acquire one Common Share (each, a “Finder’s Share“) at an exercise price of $0.40 for a period of 12 months following the closing of the Concurrent Offering.

The gross proceeds of the Concurrent Offering, less $181,238.35, being 50% of the Finder’s Fees payable to the Finders in connection with the Concurrent Offering, have been deposited into escrow pending the satisfaction of certain escrow release conditions contained in the Subscription Receipt Agreement, including the satisfaction of all conditions precedent to the Transaction and completion of the Amalgamation in accordance with the Amalgamation Agreement.

The Transaction is conditional on the TSX Venture Exchange (“TSXV“) approving the listing of the Resulting Issuer Shares and other customary conditions.

The net proceeds of the Concurrent Offering derived from the HD Subscription Receipts will be used by the Resulting Issuer to fund exploration, as well as for general corporate purposes following completion of the Transaction. The aggregate gross proceeds raised from the sale of the FT Subscription Receipts (the “Commitment Amount“) will be used by the Resulting Issuer before December 31, 2023 for general exploration expenditures, which will constitute eligible Canadian exploration expenses (within the meaning of subsection 66 (15) of the Tax Act, that will qualify as “flow through mining expenditures” within the meaning of the Tax Act (the “Qualifying Expenditures“). The Resulting Issuer shall renounce the Qualifying Expenditures so incurred to the subscribers of the FT Shares, such that the aggregate Commitment Amount shall be deductible against each such subscriber’s income for the calendar year ended December 31, 2022.

For further details relating to the Transaction, please refer to 390’s news release dated March 3, 2022, and subsequent news releases of 390 to be issued in respect of the Transaction.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act“) or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

Cautionary Note Regarding Forward-Looking Statements

This news release includes certain “forward-looking statements” under applicable Canadian securities legislation. Forward-looking statements include, but are not limited to, statements with respect to: the terms and conditions of the proposed Transaction; the satisfaction of the escrow release conditions; use of proceeds from the Concurrent Offering; future development plans; and the business and operations of the Resulting Issuer after the proposed Transaction. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: satisfaction or waiver of all applicable conditions to the completion of the Transaction (including receipt of all necessary shareholder, stock exchange and regulatory approvals or consents, and the absence of material changes with respect to the parties and their respective businesses); the synergies expected from the Transactions not being realized; business integration risks; fluctuations in general macroeconomic conditions; fluctuations in securities markets; fluctuations in spot and forward prices of base metals or certain other commodities; fluctuations in currency markets (such as the Canadian dollar to United States dollar exchange rate); change in national and local government, legislation, taxation, controls, regulations and political or economic developments; risks and hazards associated with the business of mineral exploration, development and mining (including environmental hazards, industrial accidents, unusual or unexpected formations pressures, cave-ins and flooding); inability to obtain adequate insurance to cover risks and hazards; the presence of laws and regulations that may impose restrictions on mining; employee relations; relationships with and claims by local communities and indigenous populations; availability of increasing costs associated with mining inputs and labour; the speculative nature of mineral exploration and development (including the risks of obtaining necessary licenses, permits and approvals from government authorities); and title to properties.

There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. 390 and NiCAN disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Completion of the Transactions is subject to a number of conditions, including but not limited to, TSXV acceptance. Where applicable, the Transactions cannot close until the required shareholder approval is obtained. There can be no assurance that the Transactions will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the listing application to be prepared in connection with the Transactions, any information released or received with respect to the Transaction may not be accurate or complete and should not be relied upon.

The TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed Transaction and has neither approved nor disapproved the contents of this news release.

All information contained in this news release with respect to 390 and NiCAN was supplied by the parties respectively, for inclusion herein, without independent review by the other party, and each party and its directors and officers have relied on the other party for any information concerning the other party.

For further information, please contact:

1287390 B.C. Ltd.

James Ward, Director
Phone: 416-897-2359
Email: [email protected]

NiCAN Limited

Brad Humphrey
President and CEO
Phone: 416-565-4007
Email: [email protected]

Shaun Heinrichs
Chief Financial Officer
Phone: 604-839-2788
[email protected]

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

Not for distribution to United States news wire services or for dissemination in the United States.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/119888