FIRST LITHIUM LIMITED — Capital/Financing Update 2022

Apr 21, 2022

22 April 2022

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ASX Announcement

ACN 009 081 770

Registered Office: Level 21, 459 Collins Street Melbourne VIC 3000

Contact:

Phone: +61 (0)3 8630 3321 Email: admin@ookami.com.au

Board of Directors: John Ciganek (Non-Executive Chairman)

Joseph van den Elsen (Managing Director)

Emmanuel Correia (Non-Executive Director)

Andrew Law (Non-executive Director)

Company Secretary: Justin Mouchacca

Securities on Issue: 37,946,667 ordinary shares 3,500,000 unlisted options

Current Share Price – $0.185 (as at 19 April 2022)

Market capitalisation – $7.05m (at $0.185)

Cash at Bank – $4.46M (as at 31 December 21)

About Ookami Limited

Ookami Limited (ASX: OOK) is an ASX listed company focused on the exploration and development of resource projects in Africa. The Company’s current projects are:

• Messok East Co-Ni Project

• (located in Cameroon)

• Boulbi Project (located in Senegal)

Acquisition of Cameroonian Rutile and Heavy Mineral Sands Project, Capital Raising and Technical Director Appointment

• Ookami has entered into an agreement under which it will have the right to acquire up to an 85% interest in a Rutile and Mineral Sands Project in Cameroon.

• ~$2 million capital raising via a ~A$1.35 million placement and a ~A$683,000 fully underwritten entitlement offer.

• Post transaction settlement Ookami will have ~$A6,000,000 in cash reserves and be well funded to advance its portfolio of projects and to assess complementary business development opportunities.

• Andrew Law to be appointed as an independent technical Director and Joseph van den Elsen to transition to a Non-executive Director role.

Ookami Limited ( ASX: OOK ) ( Ookami or the Company ) is pleased to announce that it has entered into a share sale agreement to acquire 100% of the issued share capital of African Mining Corporation Pty Ltd ( AMC ) ( Transaction ). AMC has the right to earn up to an 85% equity interest in three Cameroonian incorporated entities, Heritage Mining Ltd, Mungo Resources Ltd and Elephant Mining Ltd (together, the Cameroonian Companies ), which have applied for six mineral exploration permits in southern Cameroon ( Permits ). These Permits cover a total area of approximately 2,600km[2] and are considered prospective for Rutile and Heavy Mineral Sands ( HMS ) ( Transaction ).

In connection with the Transaction, the Company has received firm commitments for a placement to institutional, professional and sophisticated investors to raise ~A$1.35 million (before costs) and will also undertake a fully underwritten pro rata non-renounceable entitlement offer to existing shareholders to raise an additional ~A$683,000 (before costs) (together, the Capital Raising ). Funds raised from the Capital Raising will be used to fund exploration at the Permits and working capital purposes.

To support the Company’s activities, the Company is pleased to also announce the appointment of Andrew Law to the Board as an Independent Technical Director. Andrew has over 35 years’ experience in the mining and resources industry in Australia, Africa and South America and has extensive technical and management experience including large mineral sands dry mining and dredging environments.

Joseph van den Elsen, the Company’s Managing Director, will transition to a Non-Executive Director role.

Ookami Chairman, Mr John Ciganek said, “since reinstatement in July 2021, the Company has focussed on the Messok East Project in Cameroon and reviewed numerous opportunities to expand Ookami’s exploration footprint in the country. The acquisition of the interest in the Permits in Cameroon provides the Company with an entry into a known rutile district. An initial reconnaissance review over the Permit areas has identified rutile and heavy mineral sands occurrences within the Permit areas.

The appointment of Andrew Law as Technical Director provides the Company with access to his extensive expertise on rutile and HMS exploration and processing as well as operating in Africa.”

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BACKGROUND ON THE PERMITS

The six Permits are under valid application and are located in the Centre region of Cameroon, approximately 160km to the north east of the capital city, Yaounde (refer to Figure 1). Initial due diligence reconnaissance over a sample of the application areas has identified HMS and rutile occurrences within the permit application areas.

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Figure 1: Permit area and location

The Permits border, or are nearby to, permits applied for by French company Eramet SA ( Eramet ). Over the past three years, Eramet has applied for approximately 5,000km[2] of rutile and HMS permits in the Centre Region of Cameroon. In addition to its permits in Cameroon, Eramet currently operate the Grand Cote Operations mineral sands mine in Senegal and are the fourth largest producer of Zircon and Titanium feedstock’s globally. In addition, Eramet is the largest global ferronickel producer and second largest global manganese producer.

TRANSACTION AGREEMENTS

Share Sale Agreement

The Company has entered into a share sale agreement with the vendors of AMC ( Vendors ) (refer to Schedule 1) pursuant to which the Company has agreed to acquire 100% of the issued share capital of AMC ( Share Sale Agreement ) in consideration for the issue of 5,555,556 new fully paid ordinary shares in the Company ( Consideration Shares ).

Completion of the Share Sale Agreement is conditional upon the satisfaction and/or waiver of the following conditions precedent:

• all authorisations required to give effect to the transactions contemplated by the Share Sale Agreement being obtained or otherwise satisfied and remaining in full force and effect;

• AMC, the Cameroonian Companies and the shareholders of the Cameroonian Companies executing a replacement Earn-in and Joint Venture Agreement (now executed, see further below);

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• the Company obtaining all necessary shareholder approvals required to complete the Transaction;

• four of the Permits being granted and all authorisations in respect to those four Permits being received;

• the Company undertaking an equity capital raising and receiving valid applications to raise a minimum of A$1,350,000 (before costs) via the issue fully paid ordinary shares in the Company ( Shares ); and

• there be no material breaches of the Share Sale Agreement and no material adverse changes prior to completion.

If the conditions in respect to the Share Sale Agreement are not satisfied and/or waived by 31 August 2022, the Share Sale Agreement may be terminated by either party by written notice to the other party.

The Share Sale Agreement is otherwise subject to customary terms and conditions for a transaction of this nature, including pre-completion obligations, warranties and representations by the parties.

Earn-in and Joint Venture Agreement

AMC is a party to an earn-in and joint venture agreement pursuant to which AMC has an option to earn up to an 85% interest in the Cameroonian Companies, who have applied for the Permits ( Earn-in and Joint Venture Agreement ). As noted above, completion of the Share Sale Agreement was conditional on AMC, the Cameroonian Companies and the shareholders of the Cameroonian Companies entering into a replacement Earn-in and Joint Venture Agreement. This Earn-in and Joint Venture Agreement has now been entered into between AMC and the Cameroonian Companies on the key terms detailed below.

AMC will earn its interest in the Cameroonian Companies by:

• spending US$500,000 on the Permits within 12 months of the satisfaction and/or waiver of the conditions to earn a 75% interest ( First Earn-in Milestone );

• spending a further US$2,500,000 on the Permits within 24 months of the satisfaction of the First Earn-in Milestone to earn a further 5% interest (taking the total interest to 80%) ( Second Earn-in Milestone ); and

• spending a further US$2,500,000 on the Permits within 36 months of the satisfaction of the Second Earnin Milestone to earn a further 5% interest (taking the total interest to 85%) ( Third Earn-in Milestone ).

Upon achieving the First Earn-in Milestone, AMC will have the right to appoint two directors to each of the Cameroonian Companies.

AMC will also pay US$100,000 to the other shareholders of the Cameroonian Companies ( Other Shareholders ) as a reimbursement fee for past expenditures on the Permits.

Following the Third Earn-in Milestone Date or AMC providing notice to the Other Shareholders that AMC will no longer sole fund expenditure on the Permits, AMC and the Other Shareholders will enter into an incorporated joint venture which will fully own the Cameroonian Companies and the Permits ( Joint Venture Commencement Date ).

Post the Joint Venture Commencement Date, AMC and the Other Shareholders must contribute to the joint venture on a pro rata basis or be diluted.

In connection with the Earn-in and Joint Venture Agreement, the Other Shareholders will receive a 1.25% net smelter royalty from all products from the Permits.

CAPITAL RAISING

Placement

The Company has received firm commitments from institutional, professional and sophisticated investors to subscribe for 7,500,000 new Shares ( New Shares ) at an issue price of $0.18 per New Share to raise approximately A$1.35 million (before costs).

The issue price of A$0.18 per New Share represents a:

• 2.70% discount to the last closing price of A$0.185 on 19 April 2022; and

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• 7.2% discount to the five-day weighted average price of A$0.193 on 19 April 2022.

The New Shares under the Placement will be issued to institutional, professional and sophisticated investors identified by the Company and the joint lead managers, CPS Capital Group ( CPS ) and Inyati Capital ( Inyati ) (together, the Joint Lead Managers ). None of the participants are related parties, key management personnel or an adviser of the Company.

Participants in the Placement will also, subject to shareholder approval, be eligible to subscribe for one (1) free attaching option for every three (3) New Shares issued under the Placement ( Placement Option ). Each Placement Option will have an exercise price of A$0.30 and an expiry date of 8 July 2024. The Company will, subject to the satisfaction of the requirements in ASX Listing Rule 2.5, seek quotation of the Placement Options on ASX.

The New Shares under the Placement will be issued, pursuant to the Company’s existing placement capacity under ASX Listing Rule 7.1, on or around 4 May 2022.

Entitlement Offer

The Company will also undertake a fully underwritten one (1) for ten (10) pro rata non-renounceable entitlement offer of up to 3,794,667 New Shares at an issue price of A$0.18 (being the same issue price as the Placement) to raise up to approximately A$683,000 (before costs) ( Entitlement Offer ). Participants in the Entitlement Offer will also be issued one (1) free attaching option for every three (3) New Shares issued under the Entitlement Offer ( Entitlement Offer Option ). Each Entitlement Offer Option will have the same terms and conditions as the Placement Options (being an exercise price of A$0.30 and an expiry date of 8 July 2024). The Company will, subject to the satisfaction of the requirements in ASX Listing Rule 2.5, seek quotation of the Entitlement Offer Options on ASX.

Each New Share issued under the Entitlement Offer will rank equally with existing Shares on issue. The Company will, upon issue of the New Shares under the Capital Raising, seek quotation of the New Shares on ASX. The Entitlement Offer is non-renounceable (i.e. entitlements will not be tradeable or otherwise transferrable). The Entitlement Offer is fully underwritten and there will not be a minimum subscription amount under the Entitlement Offer.

It is presently envisaged that the Entitlement Offer will open from 3 May 2022 to 2 June 2022 to eligible shareholders who are registered as a holder of Shares as at 5:00pm (AEST) on the Record Date of 29 April 2022 and have a registered address in Australia or New Zealand ( Eligible Shareholders ).

A prospectus in respect of (amongst other matters) the Entitlement Offer and the offer of the Placement Options to participants of the Placement is expected to be dispatched on 3 May 2022 ( Prospectus ).

The Entitlement Offer will be underwritten by CPS Capital Group, with Inyati Capital acting as sub-underwriter. The underwriting is subject to certain termination rights. Details in respect to the underwriting arrangement will be provided in the Prospectus

In connection with Capital Raising, the Company proposes to issue:

• 3,500,000 options to the Joint Lead Managers (to be split equally) for the provision of lead manager services ( Lead Manager Options ); and

• 1,500,000 options to CPS for the provision of underwriting services ( Underwriter Options ),

on the same terms and conditions as the Placement Options and Entitlement Offer Options (being an exercise price of A$0.30 and an expiry date of 8 July 2024).

An Appendix 3B for the proposed issue of new securities in respect to the Placement and Entitlement Offer and the Lead Manger Options and Underwriter Options will follow this announcement.

TECHNICAL DIRECTOR APPOINTMENT

The Board welcomes Andrew Law as an independent technical Director.

Andrew Law has over 35 year’ experience in the mining and Resources industry in Australia, Africa and South America. His extensive technical and management experience ranges from deep level underground mining

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environments to large open pit environments to large mineral sands dry mining and dredging environments, across a range of mineral commodities.

Andrew’s executive management experience has been gained at the Board, Corporate and Executive operational levels at Anglo American, Plutonic Resources, Downer Group, Placer Dome, Millenium Minerals, Mundo Minerals Limited, St Barbara Limited and Optiro. Recently, he was the Executive Director – Projects at Relentless Resources, a private Resources exploration and development company, exploring and developing mineral sands projects in NSW.

Andrew is a qualified Mining Engineer (University of Johannesburg) with a Master’s degree in Business Administration from The University of Western Australia. He is a Fellow of the AusIMM (CP – Management), a Fellow of the Institute of Quarrying – Australia, a member of the Australian Institute of Company Directors and an Associate Fellow of the Australian Institute of Management.

As part of Andrew’s appointment to the Board, the Company has agreed to issue him 400,000 unlisted options on the following terms:

• 200,000 Class A Management Performance Options – each with an exercise price of $0.001 expiring 8 July 2023, vesting upon the Company achieving a 20 day VWAP of $0.40; and

• 200,000 Class B Management Performance Options – each with an exercise price of $0.001 expiring 8 July 2023, vesting upon the Company achieving a 20 day VWAP of $0.80.

Following Andrew’s appointment, Mr Joseph van den Elsen will transition from Managing Director of the Company to a non-executive director role.

SHAREHOLDER APPROVALS

The Company will shortly dispatch a notice of meeting to convene a meeting of shareholders to be held in May 2022, to consider resolutions in relation to the Transaction. These resolutions will include (amongst others):

• shareholder approval pursuant to ASX Listing Rule 7.1 for the issue of the Consideration Shares to the Vendors;

• shareholder approval pursuant to ASX Listing Rule 7.1 for the issue of Placement Options pursuant to the Capital Raising; and

• shareholder approval pursuant to ASX Listing Rule 7.4 to ratify the issue of New Shares pursuant to the Placement.

The Company anticipates that, subject to shareholder approval, completion of the Transaction will occur in late May 2022.

INDICATIVE TIMETABLE

The following is an indicative timetable for completion of the Transaction and the Capital Raising:

Event	Indicative Date*
Announcement of Transaction and Capital Raising	Friday, 22 April 2022
Lodgement of Prospectus with ASIC and ASX	Tuesday, 26 April 2022
“Ex” Date (being the date that Shares start trading without Entitlements to participate in Entitlement Offer)	Thursday, 28 April 2022
Record Date	5.00pm (AEST) Friday, 29 April 2022
Despatch of Prospectus and Entitlement and Acceptance Form	Tuesday, 3 May 2022

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Event	Indicative Date*
Entitlement Offer opens	Tuesday, 3 May 2022
Issue Placement Shares	Wednesday, 4 May 2022
Last day to extend the Entitlement Offer Closing Date	Monday, 30 May 2022
General Meeting	Thursday, 2 June 2022
Entitlement Offer closes	5.00pm (AEST) Thursday, 2 June 2022
Announce results of Entitlement Offer	Monday, 6 June 2022
Settlement of Entitlement Offer	Tuesday, 7 June 2022
Issue new securities under Entitlement Offer	Wednesday, 8 June 2022
ASX quotation of New Shares and New Options	Wednesday, 8 June 2022
Completion of the Transaction	Thursday, 9 June 2022

* The above timetable is indicative only and subject to change. The Directors reserve the right to amend the timetable without notice and will keep shareholders updated (via ASX announcements) on the timing of the completion of the Transaction as they progress.

PRO-FORMA CAPITAL STRUCTURE

Following the completion of the Capital Raising and of the Transaction, the indicative effect on the Company's capital structure will be as follows:

Event	Number of Shares	Number of Options
ExistingCapital Structure	37,946,667	3,500,0001
Acquisition of AMC	5,555,556	-
Capital Raising	11,294,6672	3,764,8892
Joint Lead Manager options for Capital Raising	-	5,000,000
Issue of options to Technical Director	-	400,000
Total	54,796,889	12,664,889

Notes:

1. Comprising:

2. a. 1,500,000 unquoted options exercisable at A$0.30 each on or before 8 July 2024; and

3. b. 2,000,000 unquoted options subject to vesting conditions and exercisable at A$0.001 each on or before 8 July 2023.

4. Comprising:

5. a. 7,500,000 Shares and 2,500,000 Options issued pursuant to the Placement; and

6. b. 3,794,667 Shares and 1,264,889 Options pursuant to the Entitlement Offer.

Boulbi and Messok East Project Updates

The acquisition of the Permits expands the Company’s asset portfolio. The Company’s shares were re-quoted on ASX in July 2021 ( Reinstatement ) following completion of a $5.7 million capital raising and acquisition of a 51.3% interest in an advanced copper exploration project located in the Tambacounda Region in Senegal ( Boulbi Project )

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and a 100% interest in a nickel and cobalt exploration project located in the southeast of Cameroon ( Messok East Project ). Refer to the Company's replacement prospectus dated 23 April 2021 ( Replacement Prospectus ) for further information.

The Company continues to progress work on these projects but notes that on a pro-rata basis, its expenditure the Boulbi Project and Messok East Project has been less than budgeted as detailed in the 24 month use of funds table detailed in section 1.9 of the Replacement Prospectus due to the following factors:

1. The Company's management team has been subject to extended periods of travel restrictions.

2. Since the Reinstatement, the Company's Managing Director has undertaken four site visits to the Messok East Project in Cameroon (when he obtained travel permission from the Western Australian state government to travel to Cameroon in August/September 2021), but, due to COVID travel restrictions, has not been able to travel to Senegal to visit the Boulbi Project (noting that the majority of the expenditure outlined in the use of funds in section 1.9 of the Replacement Prospectus is in respect to the Boulbi Project in Senegal).

3. The Company has been adversely impacted by events that are outside of the Company's control, being:

4. a. spikes in COVID-19 infection rates in Senegal and Cameroon (since the Reinstatement) which have made it difficult to conduct exploration activities in Cameroon and Senegal in a safe, efficient and cost effective manner (if at all); and

5. b. the Western Australian state government's stance on its international borders (prior to February 2022) which has made travel to Cameroon and Senegal problematic (noting that at this time, and owing to COVID driven border and travel restrictions, travel to Senegal is not possible).

6. Having regard to the above, to protect the safety of its executive and consultants, the Company's Board has been conservative in its planning for the 2021 field related exploration activities and a decision was made to withhold significant expenditure on its projects until such time as the Company and its advisors were able to spend meaningful time in country.

Notwithstanding the above, the Company continues to assess the prospectivity of the Boulbi Project and Messok East Project which the Company hopes will result in a more streamlined exploration effort moving forward. The Company intends to ramp up exploration activities in Cameroon and will reformulate its planning and activities in Senegal once it has access to, and has had an opportunity to visit, the Boulbi Project (with a view to advancing the higher cost activities contemplated in section 1.9 of the Replacement Prospectus).

The table below compares the Company’s actual expenditure against the 2 Year Use of Funds table detailed in section 1.9 of the Replacement Prospectus:

Use of funds as contained in the Prospectus	2 Year Use of Funds as contained in the Prospectus	Actual amount spent to date (for the period between 14 July and Date of this announcement)
Boulbi Project Exploration Expenditure	$2,500,000	$124,499
Messok East Project Exploration Expenditure	$700,000	$115,707
Corporate Administration and Loan Repayment	$815,000	$717,964
Working Capital	$1,027,373	$13,299
Costs of the Offers	$735,400	$725,350
Total	$5,777,773	$1,696,819

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FURTHER INFORMATION

For corporate queries, please contact Joseph Van Den Elsen on +61 (03) 8630 3321

For other questions, you should consult your broker, solicitor, accountant, financial adviser, or other professional adviser.

-Ends-

This announcement has been approved for release by the Board of OOK.

For more information, please contact:

Justin Mouchacca Company Secretary P: +61 (0)3 8630 3321

About Ookami Limited

The Company was admitted to the Official List (ASX code: OOK) in February 2000 and was previously focused on the operation of the Akela Platform, a fintech Software as a Service platform, and its passive 18.3% equity interest in BronTech Pty Ltd, a data exchange and identity platform.

Since July 2021, the Company has been focused on the assessment and evaluation of its 100% owned Messok East Co-Ni Project and the Boulbi Permit Joint Venture (51% earning to 70%). The Company actively seeks to identify, assess and potentially acquire complementary opportunities.

Forward Looking Statement

This ASX announcement may include forward-looking statements. These forward-looking statements are not historical facts but rather are based on Ookami Ltd.’s current expectations, estimates and assumptions about the industry in which Ookami Ltd operates, and beliefs and assumptions regarding Ookami Ltd.’s future performance. Words such as “anticipates”, “expects”, “intends”, “plans”, “believes”, “seeks”, “estimates”, “potential” and similar expressions are intended to identify forward-looking statements. Forward-looking statements are only predictions and are not guaranteed, and they are subject to known and unknown risks, uncertainties and assumptions, some of which are outside the control of Ookami Ltd. Past performance is not necessarily a guide to future performance and no representation or warranty is made as to the likelihood of achievement or reasonableness of any forwardlooking statements or other forecast. Actual values, results or events may be materially different to those expressed or implied in this ASX announcement. Given these uncertainties, recipients are cautioned not to place reliance on forward looking statements. Any forward-looking statements in this announcement speak only at the date of issue of this announcement. Subject to any continuing obligations under applicable law and the ASX Listing Rules, Ookami Ltd does not undertake any obligation to update or revise any information or any of the forward-looking statements in this announcement or any changes in events, conditions, or circumstances on which any such forward looking statement is based.

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Schedule 1

Name	No. of shares in AMC	No. of Consideration Shares
Dogbolter Pty Ltd	50	978,091
3VL Pty Ltd	23	449,922
Melbor Pty Ltd	23	449,922
Mark Jonathan Sandford	23	449,922
David James Wall	23	449,922
J Stimpson Pty Ltd	46	899,843
Tellaro Pty Ltd	46	899,843
Hopetoun Consulting Pty Ltd Fund>	50	978,091
TOTAL	284	5,555,556

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