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Commerce Resources Corp. Announces Private Placement of Flow-Through Units to Raise Gross Proceeds of up to $5,040,000

Press Release

June 6, 2024 – Commerce Resources Corp. (TSXv: CCE, FSE: D7H0) (the “Company” or “Commerce”) is pleased to announce a non-brokered private placement offering of up to 28,000,000 charity flow-through units (each, a “FT Unit“) at a price of $0.18 per FT Unit for aggregate gross proceeds of up to $5,040,000 (the “Offering“). Each FT Unit will be comprised of one common share in the capital of the Company (each, a “FT Share”) and one transferable share purchase warrant (each, a “Warrant”).  Each Warrant shall entitle the holder to receive one non-flow-through common share in the capital of the Company (each, a “Warrant Share”) at a price of $0.25 per Warrant Share at any time before the date that is two (2) years following the date of issuance.  The FT Units are being issued pursuant to a charity arrangement structured by Peartree Securities Inc.

The Company also announces that it has entered into an agreement (“Term Sheet”) with Churchill SIG Pty Ltd. (“Churchill”), whereby Churchill will act as lead manager, for a term of up to three (3) months, to introduce potential qualified subscribers (the “Services”) to the Company in connection with the Offering.  Churchill will not provide the Services in Canada or for the benefit of Canadian residents, and any potential subscribers introduced by Churchill will not be residents of Canada.

As consideration for the Services, and upon completion of the Offering, the Company has agreed to pay Churchill a cash fee (the “Cash Fee”) equal to 5% of the amount raised under the Offering from persons introduced by Churchill, and to issue such number of non-transferable share purchase warrants (the “Finder’s Warrants”) that equals 12.5% of the total number of FT Shares issued to persons introduced by Churchill under the Offering.  Each Finder’s Warrant will entitle the holder to acquire one additional common share (a “Finder’s Warrant Share”) in the capital of the Company at a price of $0.20 per Finder’s Warrant Share for a period of two (2) years from the date of issuance of the Finder’s Warrants. The Company has also agreed to pay for Churchill’s reasonable fees and expenses in connection with the Services, up to $10,000.  Churchill shall have a right of first refusal to act as lead manager in connection with any other equity offerings undertaken by the Company within a 12-month period following completion of the Offering.  The FT Shares, Finder’s Warrants and Finder’s Warrant Shares are collectively referred to herein as the “Securities”.

The Offering will be conducted pursuant to one or more prospectus exemptions available to the Company, including, without limitation, the “accredited investor” exemption set out in Section 2.3 of National Instrument 45-106 – Prospectus Exemptions and the prospectus exemption set out in BC Instrument 72-503 – Distribution of Securities Outside British Columbia.

In addition to the fee payable to Churchill in connection with investors introduced to the Company by Churchill, the Company may pay finders’ fees consisting of cash, securities or a combination thereof to other parties in connection with the Offering, all in accordance with the policies of the TSX Venture Exchange (the “Exchange”).

The Offering is expected to close on or about June 18, 2024, or on any other date or dates as the Company may determine, and is subject to certain conditions including, but not limited to, the receipt of all necessary regulatory and other approvals including the acceptance of the Exchange. The Securities, and the underlying securities, will be subject to a hold period of four months and one day from the date of closing.

Certain insiders of the Company are anticipated to participate in the Offering, and the participation of insiders will be considered a related party transaction subject to Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The Company intends to rely on exemptions from the formal valuation and minority shareholder approval requirements provided under subsections 5.5(a) and 5.7(1)(a) of MI 61-101 on the basis that participation in the Offering by insiders will not exceed 25% of the Company’s market capitalization.

The FT Shares will qualify as “flow-through shares” (within the meaning of subsection 66(15) of the Income Tax Act (Canada) (the “Tax Act“). An amount equal to the gross proceeds from the issuance of the FT Shares will be used to incur eligible resource exploration expenses which will qualify as “Canadian exploration expenses” (as defined in the Tax Act). Qualifying Expenditures in an aggregate amount not less than the gross proceeds raised from the issue of the FT Shares will be incurred (or deemed to be incurred) by the Company on or before December 31, 2025 and will be renounced by the Company to the initial purchasers of the FT Shares with an effective date no later than December 31, 2024.  The gross proceeds from the sale of the FT Shares will be used to underwrite the upcoming drilling program for the niobium targets on the claims owned by the Company in Nunavik, Quebec.

None of the securities sold in connection with the Offering will be registered under the United States Securities Act of 1933, as amended, and no such securities may be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This news 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.

About Commerce Resources Corp.

Commerce Resources Corp. is a junior mineral resource company focused on the development of the Ashram Rare Earth and Fluorspar Deposit located in Quebec, Canada. The Company is positioning to be one of the lowest cost rare earth producers globally, with a specific focus on being a long-term supplier of mixed rare earth carbonate and/or NdPr oxide to the global market. The Ashram Deposit is characterized by simple rare earth (monazite, bastnaesite, xenotime) and gangue (carbonates) mineralogy, a large tonnage resource at favourable grade, and has demonstrated the production of high-grade (>45% REO) mineral concentrates at high recovery (>70%) in line with active global producers. In addition to being one of the largest rare earth deposits globally, Ashram is also one of the largest fluorspar deposits globally and has the potential to be a long-term supplier to the met-spar and acid-spar markets.

For more information, please visit the corporate website at www.commerceresources.com   or email info@commerceresources.com.

On Behalf of the Board of Directors
COMMERCE RESOURCES CORP.

“Chris Grove”
Chris Grove
CEO and President
Tel: 604.484.2700
Email: cgrove@commerceresources.com
Web:   http://www.commerceresources.com

IBF4

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