Electric Metals (USA) Limited announced a private placement of up to 26,595,746 units at a price of CAD 0.235 for gross proceeds of CAD 6,250,000.31 on May 16, 2023. Each unit will consist of one common share and one share purchase warrant. Each unit will be exercisable to acquire one additional Common Share for a period of 24 months from the date of issuance of the Unit.

In connection with the offering, the company has entered into a binding letter of intent with Quail Bend LLC dated May 12, 2023. The transaction will include participation from Quail Bend LLC for 21,276,596 units or up to a 16.7% stake and other insider investors. The transaction will be completed in multiple tranches.

The first closing shall occur on or before June 15, 2023 and shall be for an amount of units purchased to be determined by Quail Bend LLC subject to a minimum of 5,319,150 Units for minimum proceeds of not less than CAD 1,250,000.25 and a maximum number of Units which does not result in Quail Bend becoming a ?Control Person? as defined by the policies of the TSX Venture Exchange. The First Closing is also expected to include the subscription of 5,319,150 units by certain insiders of the Company and other third parties mutually acceptable to the Parties.

The purchase price for the Units sold in the First Closing will be CAD 0.235 per unit. Each Warrant partially comprising the Units issued pursuant to the First Closing will be exercisable at a price of CAD 0.35 per share for a period of 24 months following the distribution thereof. The second closing shall be completed in one or more tranches on or prior to September 30, 2023 .

The company will issue equity units at an amount of Equity Units not exceeding in the aggregate the difference between 21,276,596 and the number of equity units subscribed for by Quail Bend LLC in the First Closing. Any securities to be issued under the Offering will be subject to a hold period of four months and a day in Canada from the closing date of the Offering in accordance with the rules and policies of the TSXV and applicable Canadian securities laws and/or such other further restrictions as may apply under foreign securities laws. Closing of the Offering is subject to customary closing conditions, including the negotiation of definitive Unit purchase agreements and an investor rights agreement, receipt of all required regulatory approvals, the availability of prospectus and registration exemptions and approval of the TSXV and where applicable, Company shareholders.