LOYAL METALS LTD — Capital/Financing Update 2023

Jun 7, 2023

Proposed issue of securities

==> picture [21 x 22] intentionally omitted <==

Announcement Summary

Entity name

LOYAL LITHIUM LIMITED

Announcement Type

New announcement

Date of this announcement

8/6/2023

The Proposed issue is:

==> picture [8 x 8] intentionally omitted <==

A placement or other type of issue

Total number of +securities proposed to be issued for a placement or other type of issue

		Maximum Number of
ASX +security code	+Security description	+securities to be issued
New class-code to be	Unquoted Consideration Options	4,000,000
confirmed
LLI	ORDINARY FULLY PAID	16,000,000

Proposed +issue date 26/6/2023

Refer to next page for full details of the announcement

Proposed issue of securities

1 / 7

Proposed issue of securities

==> picture [21 x 22] intentionally omitted <==

Part 1 - Entity and announcement details

1.1 Name of +Entity

LOYAL LITHIUM LIMITED

We (the entity named above) give ASX the following information about a proposed issue of +securities and, if ASX agrees to +quote any of the +securities (including any rights) on a +deferred settlement basis, we agree to the matters set out in Appendix 3B of the ASX Listing Rules.

If the +securities are being offered under a +disclosure document or +PDS and are intended to be quoted on ASX, we also apply for quotation of all of the +securities that may be issued under the +disclosure document or +PDS on the terms set out in Appendix 2A of the ASX Listing Rules (on the understanding that once the final number of +securities issued under the +disclosure document or +PDS is known, in accordance with Listing Rule 3.10.3C, we will complete and lodge with ASX an Appendix 2A online form notifying ASX of their issue and applying for their quotation).

1.2 Registered Number Type

ACN

Registration Number 644564241

1.3 ASX issuer code

LLI

1.4 The announcement is

==> picture [8 x 8] intentionally omitted <==

New announcement

1.5 Date of this announcement

8/6/2023

1.6 The Proposed issue is:

==> picture [8 x 8] intentionally omitted <==

A placement or other type of issue

Proposed issue of securities

2 / 7

Proposed issue of securities

==> picture [21 x 22] intentionally omitted <==

Part 7 - Details of proposed placement or other issue

Part 7A - Conditions

7A.1 Do any external approvals need to be obtained or other conditions satisfied before the placement or other type of issue can proceed on an unconditional basis? Yes

7A.1a Conditions

Approval/Condition Date for determination Is the date estimated or ** Approval actual? received/condition met? +Security holder approval 26/6/2023 Actual No

Comments

Part 7B - Issue details

Is the proposed security a 'New class' (+securities in a class that is not yet quoted or recorded by ASX) or an 'Existing class' (additional securities in a class that is already quoted or recorded by ASX)? Existing class

Will the proposed issue of this +security include an offer of attaching +securities? No

Details of +securities proposed to be issued

ASX +security code and description

LLI : ORDINARY FULLY PAID

Number of +securities proposed to be issued

16,000,000

Offer price details

Are the +securities proposed to be issued being issued for a cash consideration? No

Proposed issue of securities

3 / 7

Proposed issue of securities

==> picture [21 x 22] intentionally omitted <==

Please describe the consideration being provided for the +securities

Consideration to Youssa Pty Ltd and DG Resource Management Ltd as part consideration payable under the Acquisition Agreements. Refer to Section 7.1 of the Prospectus for a summary of the Acquisition Agreements. https://www.asx.com.a u/asx/statistics/displayAnnouncement.do?display=pdf&idsId=02672989

Please provide an estimate of the AUD equivalent of the consideration being provided for the +securities

4,800,000.000000

Will these +securities rank equally in all respects from their issue date with the existing issued +securities in that class? Yes

Is the proposed security a 'New Will the proposed issue of this class' (+securities in a class that is +security include an offer of not yet quoted or recorded by ASX) attaching +securities? or an 'Existing class' (additional No securities in a class that is already quoted or recorded by ASX)? New class

Details of +securities proposed to be issued

ISIN Code (if Issuer is a foreign company and +securities are non CDIs)

Have you received confirmation from Will the entity be seeking quotation ASX that the terms of the proposed of the 'new' class of +securities on +securities are appropriate and ASX? equitable under listing rule 6.1? No Yes ASX +security code +Security description New class-code to be confirmed Unquoted Consideration Options

+Security type

Options

Number of +securities proposed to be issued

4,000,000

Offer price details

Are the +securities proposed to be issued being issued for a cash consideration? No

Proposed issue of securities

4 / 7

Proposed issue of securities

==> picture [21 x 22] intentionally omitted <==

Please describe the consideration being provided for the +securities

Pursuant to the Acquisition Agreements (the materials terms of which are summarised at Section 7.1), 16,000,000 Consideration Shares will be issued amongst the Vendors. Pursuant to the respective Acquisition Agreements, 14,000,000 Consideration Shares will be issued to Youssa and 2,000,000 Consideration Shares will be issued to DGRM. Please provide an estimate of the AUD equivalent of the consideration being provided for the +securities 647,000.000000 Will all the +securities issued in this class rank equally in all respects from their issue date? Yes Options details +Security currency Exercise price Expiry date AUD - Australian Dollar AUD 0.6000 28/3/2026 Details of the type of +security that will be issued if the option is exercised LLI : ORDINARY FULLY PAID Number of securities that will be issued if the option is exercised 4000000 Please provide a URL link for a document lodged with ASX setting out the material terms of the +securities proposed to be issued or provide the information by separate announcement. Refer Notice of Meeting - https://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=02669925

Part 7C - Timetable 7C.1 Proposed +issue date 26/6/2023 Part 7D - Listing Rule requirements

7D.1 Has the entity obtained, or is it obtaining, +security holder approval for the entire issue under listing rule 7.1? Yes 7D.1a Date of meeting or proposed meeting to approve the issue under listing rule 7.1 26/6/2023

Proposed issue of securities

5 / 7

Proposed issue of securities

==> picture [21 x 22] intentionally omitted <==

7D.2 Is a party referred to in listing rule 10.11 participating in the proposed issue? No

7D.3 Will any of the +securities to be issued be +restricted securities for the purposes of the listing rules? No

7D.4 Will any of the +securities to be issued be subject to +voluntary escrow? Yes

7D.4a Please enter the number and +class of the +securities subject to +voluntary escrow and the date from which they will cease to be subject to +voluntary escrow

The Shares issued under the Consideration Offer may be subject to escrow under the ASX Listing Rules. - Refer Prospectus - S2.10 - https://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=02672989

Part 7E - Fees and expenses

7E.1 Will there be a lead manager or broker to the proposed issue? No

7E.2 Is the proposed issue to be underwritten?

==> picture [8 x 9] intentionally omitted <==

No

7E.4 Details of any other material fees or costs to be incurred by the entity in connection with the proposed issue

Part 7F - Further Information

7F.01 The purpose(s) for which the entity is issuing the securities

Pursuant to the Acquisition Agreements (the materials terms of which are summarised at Section 7.1 of the Prospectus),

7F.1 Will the entity be changing its dividend/distribution policy if the proposed issue proceeds? No

7F.2 Any other information the entity wishes to provide about the proposed issue

7F.3 Any on-sale of the +securities proposed to be issued within 12 months of their date of issue will comply with the secondary sale provisions in sections 707(3) and 1012C(6) of the Corporations Act by virtue of:

The publication of a +disclosure document or +PDS involving the same class of securities as the +securities proposed to be issued that meets the requirements of section 708A(11) or 1012DA(11)

Proposed issue of securities

6 / 7

Proposed issue of securities

==> picture [21 x 22] intentionally omitted <==

==> picture [540 x 710] intentionally omitted <==

Proposed issue of securities

7 / 7