LIONTOWN LIMITED — Capital/Financing Update 2016

Sep 5, 2016

ASX : LTR

ABN 39 118 153 825

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ASX ANNOUNCEMENT

6 September 2016

Liontown announces $1.4M rights issue to fast-track drilling of two highly prospective Australian lithium projects

Summary:

• Liontown to undertake a 1-for-5 non-renounceable pro-rata rights issue at $0.01 to raise up to approximately $1.4 million before issue costs.

• Funds to be used for substantial drilling programs at the Bynoe Lithium Project in the NT, the Kathleen Valley Lithium-Tantalum Project in WA and for general working capital requirements.

• Drilling at the Bynoe Lithium Project, located <50km from Darwin, planned to commence within the next few weeks.

• Drilling will commence at Kathleen Valley as soon as permitting and heritage clearance is obtained.

• Eligible shareholders will be given the opportunity to apply for Additional Shares in excess of their entitlement.

• Liontown’s Chairman and largest shareholder, Tim Goyder, to take up his full entitlement.

Liontown Resources Limited (ASX: LTR) (the Company or Liontown ) is pleased to advise that it will undertake a 1-for-5 non-renounceable rights issue to eligible shareholders at an issue price of $0.01 for each new share ( New Shares) to raise up to $1,398,901 before issue costs (the Offer ).

The proceeds of the rights issue will enable the Company to undertake substantial drilling and exploration programs at its two key emerging Australian lithium projects, while also providing working capital to advance other exploration and growth opportunities.

Liontown’s Chairman and largest shareholder, Tim Goyder, has confirmed his intention to take up his full entitlement of approximately $377,000. All other directors have also committed to take up their full entitlements.

The Opportunity

The proceeds of the rights issue will enable Liontown to move ahead with a planned drilling program at the Bynoe Lithium Project , located 50km from Darwin in the Northern Territory.

The Company recently completed a maiden drilling program at Bynoe, confirming the presence of thick spodumene-related lithium mineralisation, with lithium values of >1% Li2O returned at six of the initial 10 targets tested.

Liontown has received approvals for a planned program of ~3,000m of Reverse Circulation drilling at the Sandras pegmatite and other nearby targets, although this program may be expanded as a result of the recent identification of other pegmatite targets.

Liontown Resources Limited, Level 2, 1292 Hay Street, West Perth, Western Australia 6005 T: +618 9322 7431 F: +618 9322 5800 E: info@ltresources.com.au www.ltresources.com.au

The Company also plans to progress exploration at the recently acquired Kathleen Valley LithiumTantalum Project , where it has completed a review of the exploration potential with highly encouraging initial results (see separate ASX Announcement, 6 September). Permitting and heritage clearance will be required prior to the planned drill program. The acquisition of this project remains subject to the satisfaction of conditions precedent (refer to the Company’s announcement of 4 August 2016 for further details). It is anticipated that completion will occur shortly.

The proceeds of the raising will also be used for the following purposes:

• To progress exploration activities at the Company’s other emerging lithium projects, including the Lake Percy Lithium Project in WA and the Mohanga Lithium-Tantalum-Gold Project in Tanzania;

• To undertake a review of the existing 390,000oz gold Inferred Mineral Resource at the Jubilee Reef Gold Project in Tanzania to determine the optimum strategy for unlocking the value of this strategically located gold resource; and

• For general working capital purposes.

Timetables

Offer documentation is currently being prepared for dispatch to eligible shareholders. Key dates, including the Record Date and closing date of the issue, will be advised in due course.

Further Information

The Offer will be made to shareholders with registered addresses in Australia and New Zealand on the Record Date of the Offer ( Eligible Shareholders ). Shareholders with a registered address outside Australia and New Zealand will not be eligible to participate in the Offer. As the Offer is nonrenounceable, Eligible Shareholders will not be able to sell or otherwise transfer their entitlements.

Eligible Shareholders (other than Directors and related parties of the Company) may, in addition to taking up their entitlements in full, apply for additional shares in excess of their entitlements ( Additional Shares ). Additional Shares will only be available where there is a shortfall between applications received from Eligible Shareholders, and the number of new shares proposed to be issued under the Offer. Additional Shares will be issued at the discretion of the Directors at the issue price of $0.01.

If any shortfall remains after the allocation of Additional Shares to Eligible Shareholders as set out above, the Directors reserve the right to place the remaining shortfall at their discretion (at a price not less than the issue price of $0.01 per Share) within three months of the close of the Offer.

Full details of the Offer will be contained in a Prospectus to be lodged with the ASX and to be despatched to Eligible Shareholders in accordance with an indicative timetable to be advised. The Prospectus will also be available on the Company’s website at www.ltresources.com.au.

Yours faithfully,

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Tim Goyder Chairman 6 September 2016

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The Information in this document that relates to the Exploration Results for the Bynoe Project is extracted from the ASX announcement entitled “Initial assay results from drilling at Bynoe Lithium Project” released on 26 July 2016 and available on www.ltresources.com.au.

The company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcements. The Company confirms that the form and context in which the Competent Person’s findings are presented have not been materially modified from the original market announcement.

This document contains forward-looking statements which involve a number of risks and uncertainties. These forward looking statements are expressed in good faith and believed to have a reasonable basis. These statements reflect current expectations, intentions or strategies regarding the future and assumptions based on currently available information. Should one or more of the risks or uncertainties materialise, or should underlying assumptions prove incorrect, actual results may vary from the expectations, intentions and strategies described in this announcement. No obligation is assumed to update forward looking statements if these beliefs, opinions and estimates should change or to reflect other future developments.

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