First Phosphate Announces Private Placement Financing

Vancouver, Canada –
Newsfile Corp. – August 9, 2022 – First Phosphate Corp. (“First Phosphate” or the “Company”) is pleased to announce a non-brokered private placement financing to raise up to $1,000,000 (the “Offering”). The Offering is anticipated to be structured as a best-efforts private placement comprised of 4,000,000 common shares in the capital of the Company (“Shares”) at a price of $0.25 per Shares. The Company reserves the right to increase the size of the Offering at its sole discretion. Proceeds from the Offering will be used for general working capital purposes.
The Company may engage finders and pay the finders a cash fee up to 8% of the gross proceeds raised in the Offering. Additionally, it is anticipated that finders will receive that number of compensation warrants (“Compensation Warrants”) totaling up to 8% of the number of Shares sold pursuant to the Offering. The Compensation Warrants are exercisable at a price of $0.25 per Share, for a period of 24 months after the closing of the Offering.
The Offering is expected to close on or about August 19, 2022, or such other date as the Company may determine. Completion of the Offering is subject to certain conditions including, but not limited to, the receipt of all necessary approvals. There can be no assurance that the Offering will be completed, whether in whole or in part. All securities issued by the Company in connection with the Offering will be subject to a statutory four month hold period. Furthermore, the Shares issued pursuant to the Offering shall be subject to a contractual lock-up with 25% released upon the Company’s being listed for trading on a stock exchange, and 25% released on the 4, 8 and 12 month anniversary of the initial release.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The securities being offered have not been, nor will they be, registered under the 1933 Act and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons absent registration or an applicable exemption from the registration requirements of the 1933 Act, and applicable state securities laws.
Related Party Transaction
Certain insiders of directors, officers and insiders of the Company, intend to subscribe for Shares in the Offering. The participation of such insiders in the Offering constitutes “related party transactions” as defined in Multilateral Instrument 61-101 –
Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The Company intends to rely on the exemptions from the formal valuation and minority shareholder approval requirements of MI 61-101 under sections 5.5(a), 5.5(c), 5.7(1)(b) of MI 61-101 as the Company is not listed on a specified market, the Shares are being purchased for cash, the fair market value of the Shares being purchased will not exceed 25% of the Company’s market capitalization and the Shares being purchased will not have fair market value more than $2,500,000. The Company did not file a material change report related to the Offering more than 21 days before the expected closing of the Offering as required by MI 61-101 as the Company requires the consideration it will receive in connection with the Offering immediately for working capital purposes.

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