Lithium Ionic Inc. and POCML 6 Inc. Announce Closing of Upsized $14M Subscription Receipt Offering

Toronto, Ontario–(Newsfile Corp. – February 8, 2022) – Lithium Ionic Inc. (“Lithium Ionic“) and POCML 6 Inc. (“POCML6“, and together with Lithium Ionic, the “Issuers“), are pleased to announce that Lithium Ionic and POCML6 have closed their previously-announced brokered private placements (collectively, the “Offering“) of subscription receipts (the “Subscription Receipts“). Under the Offering, Lithium Ionic and POCML6 issued an aggregate of 20,000,000 Subscription Receipts at a price of $0.70 per Subscription Receipt (the “Issue Price“) for gross proceeds of $14,000,000. The Offering was completed pursuant to an agency agreement (the “Agency Agreement“) dated February 8, 2022 among Lithium Ionic, POCML6, Clarus Securities Inc. (the “Lead Agent“), PowerOne Capital Markets Limited, iA Private Wealth Inc., Haywood Securities Inc. and Research Capital Corporation (collectively with the Lead Agent, the “Agents“). The Subscription Receipts are governed by the terms of a subscription receipt agreement in respect of the Subscription Receipts of Lithium Ionic and a subscription receipt agreement in respect of the Subscription Receipts of POCML6, each dated February 8, 2022 and among Lithium Ionic, POCML6, the Lead Agent and TSX Trust Company (“TSX Trust“) (collectively, the “Subscription Receipt Agreements“).

As previously announced, on February 7, 2022, Lithium Ionic and POCML6 entered into an amalgamation agreement (the “Amalgamation Agreement“) setting out the terms of the reverse take-over of POCML6 by the shareholders of Lithium Ionic by way of a three-cornered amalgamation with a wholly-owned subsidiary of POCML6 incorporated under the laws of the Province of Ontario (the “RTO“). POCML6, as the resulting issuer following the completion of the RTO (the “Resulting Issuer“), will continue the business of Lithium Ionic under the name “Lithium Ionic Corp.” or such other name as determined by Lithium Ionic. Prior to the closing of the RTO, POCML6 shall consolidate (the “Consolidation“) its common shares (“POCML Shares“) on the basis 0.61983471 post-Consolidation POCML6 Share for each one pre-Consolidation POCML6 Share, subject to certain adjustments as set out in the Amalgamation Agreement. For further details in respect of the RTO, please refer to the Issuers’ joint press release dated February 7, 2022.

The gross proceeds from the sale of the Subscription Receipts, less the cash portion of the Agents’ commission and Agents’ expenses, are being held in escrow by TSX Trust in accordance with the Subscription Receipt Agreements and will be released to the Issuers upon satisfaction and/or waiver of certain escrow release conditions (the “Escrow Release Conditions“), including completion of all conditions precedent to the RTO. If the Escrow Release Conditions are satisfied or waived on or before August 8, 2022 (subject to extension pursuant to the terms of the Subscription Receipt Agreements), the escrowed proceeds from the Offering will be released to the Issuers. If the Escrow Release Conditions are not satisfied or waived by that date or the Amalgamation Agreement is terminated or POCML6 or Lithium Ionic announce to the public by way of press release, or advises the Lead Agent and TSX Trust in writing, that it does not intend to satisfy the Escrow Release Conditions in accordance with the Subscription Receipt Agreements, the gross proceeds and pro rata entitlement to interest earned on the escrowed proceeds will be paid to the holders of the Subscription Receipts. The Resulting Issuer intends to use the net proceeds from the Offering for (i) exploration of Itinga Project (as defined herein) and (ii) general corporate and working capital purposes.

Upon satisfaction of the Escrow Release Conditions, each Subscription Receipt of Lithium Ionic will be automatically exchanged, without any further action by its holder, and for no additional consideration, for one common share of Lithium Ionic (a “Lithium Ionic Share“) and each Subscription Receipt of POCML6 will be automatically exchanged, without any further action by its holder, and for no additional consideration, for one post-Consolidation POCML6 Share. Immediately following the issuance of the Lithium Ionic Shares upon the conversion of the Subscription Receipts of Lithium Ionic, each Lithium Ionic Share will be exchanged for one common share in the Resulting Issuer (a “Resulting Issuer Share“).

In connection with the Offering, Lithium Ionic paid the Agents a commission satisfied by an aggregate cash payment of $70,230.25 and the issuance of 1,064,845 Subscription Receipts of Lithium Ionic at the Issue Price. As additional consideration, Lithium Ionic issued 1,165,174 broker warrants to the Agents, each entitling the Agents to purchase one Lithium Ionic Share (and subsequently one Resulting Issuer Share) at the Issue Price for a period of 24 months following the date of issuance of the Release Notice (as defined in the Agency Agreement). Also, in connection with the Offering, POCML6 paid the Agents a commission satisfied by an aggregate cash payment of $29,609.50 and the issuance of 192,525 Subscription Receipts of POCML6 at the Issue Price. As additional consideration, POCML6 issued 234,825 broker warrants to the Agents, each entitling the Agents to purchase one Resulting Issuer Share at the Issue Price for a period of 24 months following the date of issuance of the Release Notice.

About Lithium Ionic Inc.

Lithium Ionic is a private company incorporated under the laws of the Province of Ontario that owns a 100% ownership interest in the Itinga lithium project (the “Itinga Project“).

General

All information contained in this press release with respect to POCML6 and Lithium Ionic was supplied by the parties respectively for inclusion herein, and each party and its directors and officers have relied on the other party for any information concerning the other party.

In connection with the Offering, Miller Thomson LLP acted as legal counsel to Lithium Ionic, Irwin Lowy LLP acted as legal counsel to POCML6 and Bennett Jones LLP acted as legal counsel to the Agents.

For more information, please contact:

From Lithium Ionic Inc.
Lawrence Guy, Director
p:416-930-7660
larry.guy@nextedgecapital.com

From POCML 6 Inc.
David D’Onofrio Director
p:(416) 643-3880
ddonofrio@poweronecapital.com

Cautionary Notes

Certain information in this press release may contain forward-looking statements. This information is based on current expectations that are subject to significant risks and uncertainties that are difficult to predict. Such forward-looking statements or information include but are not limited to statements or information with respect to: the Escrow Release Conditions; the use of net proceeds from the Offering; the terms and conditions of the RTO; the exchange ratio under the RTO; the details of any securities issuances, conversions; and the closing of the RTO. Often, but not always, forward-looking statements or information can be identified by the use of words such as “estimate”, “project”, “belief”, “anticipate”, “intend”, “expect”, “plan”, “predict”, “may” or “should” and the negative of these words or such variations thereon or comparable terminology are intended to identify forward-looking statements and information. Actual results might differ materially from results suggested in any forward-looking statements. Additional information identifying risks and uncertainties is contained in filings by POCML6 with the Canadian securities regulators, which filings are available at www.sedar.com.

With respect to forward-looking statements and information contained herein, Lithium Ionic and POCML6 have made numerous assumptions including among other things, assumptions about general business and economic conditions of Lithium Ionic and the market in which it operates. The foregoing list of assumptions is not exhaustive.

Although management of Lithium Ionic and POCML6 believe that the assumptions made and the expectations represented by such statements or information are reasonable, there can be no assurance that forward-looking statements or information herein will prove to be accurate. 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 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 statements or information. Lithium Ionic and POCML6 do not undertake to update any forward-looking information, except in accordance with applicable securities laws. There can be no assurance that the RTO will be completed as proposed or at all.

Neither the TSXV nor the Toronto Stock Exchange has in any way passed upon the merits of the proposed RTO and has neither approved nor disapproved merits the contents of this news release.

Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this press release.

This press release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any state securities laws and may not be offered or sold within the United States unless registered under the U.S. Securities Act and applicable state securities laws, unless an exemption from such registration is available.

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR RELEASE, PUBLICATION, DISTRIBUTION OR DISSEMINATION DIRECTLY, OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES.

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