Update ON Brokered Private Placement
#439- 7184 120th Street, Surrey, B.C. V3W 0M6
UPDATE ON BROKERED PRIVATE PLACEMENT
Not for distribution to U.S. Newswire Services or for dissemination in the United States. Any failure to comply with
this restriction may constitute a violation of U.S. Securities Laws.
October 17, 2019 (Vancouver, B.C. and Montreal, Quebec) Lomiko Metals Inc. (“Lomiko”) (TSX -V: LMR,
OTC: LMRMF, FSE: DH8C) Further to the press releases dated August 20, 2019 and September 16, 2019 announcing
the engagement of Leede Jones Gable Inc. (the "Agent") as lead agent on a commercially reasonable agency basis to
undertake a brokered private placement ( the “Offering”) of a combination of U nits (as hereinafter defined) and FT
Shares (as hereinafter defined) for gross proceeds of up to $2,750,000, the Company updates shareholders. The
Company will make an application to the TSX Venture Exchange for an extension to the closing. Up to 20,000,000
common share units (the “Units”) of the Company will be offered at a price of C $0.05 per unit to raise gross proceeds
of up to $1,000,000. Each unit will consist of one (1) common share and one half of one (1/2) common share purchase
warrant (“Warrant”). Each full W arrant shall entitle the holder to acquire one (1) common share of the issuer at a
price of $0.07 per share for a period of 24 months following the closing of the Offering. Up to 35,000,000 flow
through shares ( the “ FT Shares”) will be offere d at a price of $0.05 per FT Share for gross proceeds of up to
$1,750,000.
The net proceeds from the Offering of the Units and the gross proceeds from the Offering of FT Shares will be
primarily used for: (1) a pproximately $50,000 for a new Resource Esti mate prepared in accordance NI #43 -101
regulations which will include recent drill results from the Refractory Zone; (2) approximately $700,000 for
completion of work required for a Preliminary Economic Assessment (PEA), including but not limited to,
metallurgical/engineering testing and drilling, community relations, testing for conversion to spherical graphite for
use in graphite anodes, environmental assessment and extraction and processing cost studies; (3) fund exploration
work of $1,125,000 to Decembe r 31, 2019, $425,000 on exploration in 2020; and (4) approximately $150,000 to
pursue potential off-take partners, fees and for general working capital. While the Company intends to spend the net
proceeds from the Offering as stated above, there may be circumstances where, for sound business reasons, funds may
be reallocated at the discretion of the Board.
The gross proceeds from the issuance of the FT Shares will qualify as flow -through mining expenditures, as defined
in Subsection 127(9) of the Income Tax Act (Canada), which will be renounced to the subscribers with an effective
date no later than Dec. 31, 2019, to the initial purchasers of the offered securities in an aggregate amount not less than
the gross proceeds raised from the issue of the flow-through shares, as applicable, and, if the qualifying expenditures
are reduced by the Canada Revenue Agency, the Company will indemnify each FT subscriber for any additional taxes
payable by such subscriber as a result of the company's failure to renounce the qualifying expenditures as agreed.
The Company discloses that it will be relying on certain prospectus exemptions including but not limited to, the
Existing Security Holder Exemption and BC Instrument 45 -536 Exemption from prospectus requirement for certain
distributions through an investment dealer . An exemption where the purchaser has obtained advice regarding
suitability from a person registered as an investment dealer.
Subject to applicable securities laws, the Company will permit each person or company who, as of September 13,
2019 (being the record date set by the Company pursuant to Multilateral CSA Notice 45-313 – Prospectus Exemption
for Distributions to Existing Security Holders) (“CSA 45-313”), who hold common shares as of that date (a “Current
Shareholder”) to subscribe for the Units and FS Shares that will be distributed pursuant to the Offering, provided that
the Existing Security Holder Exemption is available to such person or company.
Pursuant to CSA 45- 313, each subscriber relying on the Existing Security Holder Exemption may subscribe for a
maximum of 300,000 Units or 300,000 FS Shares, being such amount of Units and FS Shares that results in an
acquisition cost of less than or equal to $15,000 for such subscribers , unless a subscriber is resident in a jurisdiction
of Canada and has obtained advice regarding the suitability of the investment from a registered investment dealer (in
which case such maximum subscription amount will not apply). In the event that aggregate subscriptions for Units or
FT Shares under the Offering exceed the maximum number of securities to be distributed, then Units will be sold to
qualifying subscribers on a pro rata basis based on the number of Units or FT Shares subscribed for . In addit ion to
conducting the Offering pursuant to the Existing Security Holder Exemption, the Company will also accept
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subscriptions for Units or FT Shares where other prospectus exemptions are available. Any Current Shareholder
subscribing for Units or FT Share s pursuant to a prospectus exemption other than the Existing Security Holder
Exemption will not be limited to a maximum of 300,000 Units or 300,000 FT Shares.
The Company also advises that the insiders of the C ompany may also participate in the financing, which will be
completed pursuant to available related party exemptions under Multilateral Instrument 61-101 Protection of Minority
Security Holders in Special Transactions.
The closing of the Offering is expected to occur on or about November 30, 2019. Closing is subject to a number of
prescribed conditions, including, without limitations, approval of the TSX Venture Exchange. All the securities issued
under the Offering are subject to resale restrictions under applicable securities legislation.
Offering Jurisdictions
The Offering will take place by way of a brokered private placement to qualified investors in such provinces of Canada
as the Agent may designate, and otherwise in those jurisdictions where the Offering can lawfully be made under
applicable exemptions.
Agent's Compensation
On the Closing of the Offering, the Company has agreed to pay to the Agent, subject to certain exclusions, a
commission equal to 8% of the gross proceeds arising from the Offering. At the closing of the Offering, the Company
will also issue to the Agent non-transferable warrants exercisable at any time up to 24 months from closing, to acquire
common shares from treasury in an amount equal to 8% of the aggregate number of units and FT shares issued pursuant
to the Offering.
The Company discloses that there are no material facts or material changes about the Company that has not been
generally disclosed.
The Corporation does not expect to provide any offering materials to subscribers in connection with the Off ering.
For more information on the Company, review the website at www.lomiko.com, contact A. Paul Gill at 604-729-5312
or email: [email protected].
On Behalf of the Board,
LOMIKO METALS INC.
A. Paul Gill,
Chief Executive Officer
We seek safe harbor.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this release.
This news release does not constitute an offer to sell, or the solicitation of an offer to buy securities in any jurisdiction in which such offer or solicitation would be unlawful prior to registration or
qualification under the securities laws of such jur isdiction. The securities offered under the offering have not been and will not be registered under the United States Securities Act of 1933, as
amended (the "Securities Act"), or the securities laws of any state of the United States, and may not be offered or sold in the United States or to, or for the account or benefit of, any U.S. Person
(as defined in Regulation S of the Securities Act) or a person in the United States, unless an exemption from such registration requirements is available.
Forward Looking Statements
This release includes forward-looking statements regarding Lomiko and its business. Such statements are based on the current expectations and views of future events of Lomiko’s management. In
some cases, the forward -looking statements can be identified by words or phrases such as “may”, “will”, “expect”, “plan”, “anticipate”, “intend”, “potential”, “estimate”, “believe” or the
negative of these terms, or other similar expressions intended to identify forward- looking statements. The forward-looking events and circumstances discussed in this release may not occur and
could differ materially as a result of the failure to consummate the project financing, the economic feasibility of the La Loutre Project, known and unknown risk factors and uncertainties affecting
Lomiko, including risks regarding the resource industry, economic factors and the equity markets generally and many other fac tors beyond the control of Lomiko. No forward-looking statement
can be guaranteed. Forward-looking statements and information by their nature are based on assumptions and involve known and unknown risks, uncertainties and other factors which may cause
our actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking
statement or information. Accordingly, readers should not place undue reliance on any forward-looking statements or information. Forward-looking statements speak only as of the date on which
they are made and Lomiko undertakes no obligation to publicly update or revise any forward- looking statement, whether as a result of new information, future events, or otherwise, except as
required by applicable securities laws.