EDITOR: | December 13th, 2016

Canadian Metals Completes $610,000 Debenture Offering

| December 13, 2016 | No Comments
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Canadian-Metals-200x125December 13, 2016 (Source) — Canadian Metals Inc. ( the “Corporation”) (CSE:CME)(CSE:CME.CN) is pleased to announce, further to its news release dated November 9, 2016, that it has completed, subject to regulatory and CSE final approval, the private placement (the “Offering”) of 10.0% unsecured subordinated convertible debentures (the “Debentures”) of the Corporation for gross proceeds of $610,000, of which $519,000 was completed as a brokered offering with Industrial Alliance Securities Inc. as the lead agent and sole bookrunner (the “Agent”).

The Debentures are unsecured obligations of the Corporation and bear interest from the date of closing at 10.0% per annum, payable semi-annually on June 30 and December 31 of each year, commencing on June 30, 2017. Interest shall be payable in shares for the first year only. For the years hereafter, interest shall be payable in cash or shares, at the option of the holders of the Debentures (the “Holders”). If a minimum of 66.6% of the Holders (in terms of amounts of dollars) vote in favor of either a payment in cash or shares, the Corporation will pay all Holders the same way. If the payment is made in shares, it will be based on a price equal to 85% of the average closing price of the common shares of the Corporation (the “Common Shares”) for the period of 20 consecutive trading days ending five trading days before the payment date.

The Debentures are convertible at the option of the holder into Common Shares of the Corporation at any time prior to the close of business on the last business day prior to the Maturity Date, at a conversion price of CAD$0.20 per Common Share, being a rate of 5,000 per common shares per CAD$1,000 principal amount of Debentures. Holders converting their Debentures will receive accrued and unpaid interest thereon, up to, but excluding, the date of conversion.

The Corporation intends to use the net proceeds of the Offering for development and for working capital purposes.

The Agent received a cash commission equal to 8.5% of the gross proceeds of the sale of Debentures placed by it, except for such of those subscribers that are directors, consultants or members of management of the Corporation, in which case the Agent received a cash commission equal to 4% of such subscriptions. The Agent also received 25,950 common share purchase warrants (the “Agent’s Warrants”). Each Agent’s Warrant entitles the holder thereof to acquire a Common Share at a price of $0.20 for a period of 24 months from the closing date.

All securities issued in connection with the Offering, which includes insider participation, are subject to a four month hold period expiring April 13, 2017.

Seven insiders of the Corporation were issued, directly and indirectly, Debentures in the aggregate principal amount of $96,000, which constituted a “related party transaction” within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The issuance to the insider is exempt from the formal valuation and the minority shareholder approval requirements of MI 61-101, as the fair market value of the Debentures issued to, or the consideration paid by such person, did not exceed 25% of the Company’s market capitalization.

About Canadian Metals

Canadian Metals Inc. is focused exclusively on the development of its Langis Project, a high-purity silica deposit located in the province of Quebec. The Company is rapidly positioning itself to eventually become a North American silicon metal producer.

Neither the CSE nor its Regulation Services Provider accepts responsibility for the adequacy or accuracy of this release.


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