Sona Nanotech Inc. announced that it has entered into an definitive agreement to issue up to 5,000,000 common shares at an issue price of CAD 0.10 per share for the gross proceeds of CAD 500,000 on January 26, 2023. The company has entered into an agreement with a registered dealer to act as placement agent for the working capital financing which has agreed to pay a cash fee equal to 8% of proceeds and to issue compensation warrants entitling the placement agent to purchase that number of common shares as is equal to 8% of the common shares sold to investors introduced by the placement agent. Each compensation warrant will be exercisable into a common share at a price of CAD 0.10 per share at any time for a period of 24 months from closing.

The closing of the transaction is conditional upon completing an additional equity raise for gross proceeds of at least CAD 1.0 million, or any other amount that is mutually agreed by the parties, which is expected to close by February 28, 2023.