Lithium exploration and development company Winsome Resources (ASX:WR1; “Winsome” or “the Company”) is pleased to announce it is raising capital through a combination of a Flow-Through Share placement, institutional placement, and a share purchase plan for existing shareholders.

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HIGHLIGHTS

• Capital raise consists of combination of Flow-Through-Shares (FTS), institutional placement and share purchase plan.
  
• A$19m to be raised utilising the FTS provisions under Canadian tax law. The Flow-Through Shares will be placed at A$4.18 per share, representing a 79% premium to Winsome’s last closing price.
• The Flow-Through Shares will be immediately on sold through a block trade agreement to select high-quality domestic and offshore institutional investors.
• Use of the flow-through provisions enables Winsome to significantly minimise the dilution of issued capital.
• Concurrent with the FTS issue the Company is undertaking an institutional placement to raise A$31m at A$2.00 per share.
• The Company will also issue a share purchase plan document to raise up to A$10m from existing shareholders at A$2.00 per share.
• Strengthened balance sheet provides Winsome with a significant runway to fast-track ongoing lithium exploration and resource drilling activities at Cancet and Adina projects in Canada.

“Winsome Resources is excited to launch this capital raise, and to see the high level of interest from quality investors globally.

“TheadditionalworkingcapitalwillallowtheCompanyto further ramp up exploration and resource drilling activities at Cancet and Adina as we work towards announcing maiden resources across our projects.

“Further to our previous raise in November 2022, the Flow-Through Share provisions under Canadian tax law mean we are again able to raise capital at a premium to the current share price which in turn minimises dilution significantly.

“The Company continues to see exciting progress and results at Cancet and Adina, and that underpins our decision to pursue this raise and move even more aggressively towards declaring maiden resources and ultimately developing the projects toward lithium production.”

Winsome is currently undertaking exploration and drill programs at the Cancet and Adina projects, and the capital raised will be used to fund acceleration of these programs over the coming months.

As previously announced to the ASX, the Company recently received its first assay results from the Adina drilling campaign, showing impressive lithium mineralisation of 1.34% Li2O over 107.6m.¹

Pending further assay results, which are expected to be returned from SGS Global in the coming weeks, the Company intends to secure permitting to further advance the Adina discovery. In addition, the expanded program aims to complete further infill and extension drilling at both Adina and Cancet, as well as continue other exploration activities throughout 2023.

Flow-Through Shares Placement Details

The offer (“FTS Placement”) is facilitated by Canadian flow-through share dealer, PearTree Securities Inc (“PearTree”), pursuant to a subscription and renunciation agreement with the Company, and the end buyer block trade is being facilitated by Canaccord Genuity (Australia) Limited (“Canaccord”) who is acting as Lead Manager to the transaction. PearTree will not receive any fees or commissions from the Company for its role in respect of the FTS Placement.

Funds raised from the FTS Placement will be specifically applied as follows:

• expedited follow-up drilling at priority targets at Adina; prospecting, gravity, stripping and channel sampling and CEE eligible staffing expenses at Adina (totalling approximately A$12.2 million);
  
• expedited follow-up drilling at priority targets at Cancet; exploration, prospecting, gravity, stripping and channel sampling and CEE eligible staffing expenses at Cancet (totalling approximately A$5.9 million);
• surveys, field work and preliminary drilling campaigns at Winsome’s other projects: Sirmac, Decelles and Mazarec (totalling approximately A$508,000); and
• sundry exploration costs(totalling approximately A$570,000).

The Company has now received firm commitments to undertake the FTS Placement to raise approximately C$18,000,000 (A$19,184,093 before costs) through the issue of approximately 4,589,496 shares at an issue price of C$3.922 (A$4.18²) per share (“Flow-Through Shares” or “New Shares”). The Canadian “Flow Through Shares” provide tax incentives to those investors for expenditures which qualify as flow through critical mineral mining expenditures under the Income Tax Act (Canada). The Flow-Through Shares will be issued at a 79% premium to the last closing price of Winsome pursuant to the Canadian flow-through shares regime. The “Flow-Through Share” is a defined term in the Income Tax Act (Canada) and is not a special class of share under corporate law.

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