Power Metal (POW.L) Warrant Update and Extension of Insider Warrants

Power Metal Resources plc (LON:POW) the London listed exploration company seeking large scale metal discoveries across its global project portfolio announces an update in respect of Company share warrants.

Update Regarding Exercise of Warrants Expiring December 2021

On 17 December 2019 the Company issued warrants (the “December 2019 Warrants”) as part of financing undertaken by the Company and as outlined below:

All December 2019 Warrants carried a two-year life to expiry which ends today, 17 December 2021.

Power Metal can confirm that, save for 11,250,000 December 2019 Warrants held by current insiders, further details of which are provided below (the “Insider Warrants”), all December 2019 Warrants have been exercised.

The Company will be providing a breakdown of all other outstanding warrants and options in its upcoming quarterly report for the quarter ended 31 December 2021.

Warrant Exercise Proceeds and Working Capital Summary

In total the exercise of the December 2019 Warrants to date has raised an additional £1.27 million for the Company and in total all warrant exercises in 2020/2021 have raised circa £4.27 million.

This inflow of warrant monies enabled the Company to aggressively build its business model in 2021 and secure the depth and quality of project interests.

Notwithstanding this heavily active phase in 2021 Power Metal has, at all times, maintained a robust working capital position. Currently working capital, defined for this purpose as only cash and listed investments, stands at circa £3.06 million.

It is important to note that the above working capital figure excludes all unlisted Power Metal assets, including corporate holdings and project level investment holdings (“Unlisted Assets”). Included within Unlisted Assets are the Company’s pre-IPO interests in First Class Metals Ltd, Golden Metal Resources Ltd, First Development Resources Ltd and New Ballarat Gold Corporation PLC.

To assist shareholders’ understanding of the financial position of the Company a breakdown of all the Company’s unaudited assets will be provided in the quarterly report for the quarter ended 31 December 2021.

Extension of Insider Warrants

As at 17 December 2021 the following Insider Warrants remained outstanding:

The Insider warrants were issued following participation in the December 2019 financing.

The Company is currently managing numerous exploration programmes and corporate activities across its portfolio and is engaged in various discussions relating to existing or potential business interests with external third parties.

As a result, the December 2019 Warrants held by Paul Johnson (Chief Executive Officer of Power Metal) and Ed Shaw (Non-executive Director of Power Metal) cannot be exercised on the expiry date of 17 December 2021 and may be extended under the warrant instrument, as outlined below.

Under the December 2019 Warrant instrument clause 2.3 provides that should any December 2019 Warrant holder be in the possession of price sensitive information and be thereby precluded from exercising warrant subscription rights, the exercise period shall be extended until 20 business days following the date on which the Warrant holder ceases to be an insider.

Given the level of ongoing operational activity there is a material likelihood that the receipt of price sensitive information could frequently restrict the ability of Paul Johnson and Ed Shaw to exercise the December 2019 warrants.

Reflecting the above the Company has extended the Insider Warrants expiry date by three months to a new expiry date of 17 March 2022.

Related Party Note

The extension of the Insider Warrants held by Paul Johnson and Ed Shaw as outlined above, have been treated as related party transactions for the purposes of AIM Rule 13.

Scott Richardson Brown being the independent Director for the purposes of the extension of the expiry date of the Insider Warrants held by Paul Johnson and Ed Shaw considers, having consulted with the Company’s nominated adviser, SP Angel, that the extension of the warrant expiry date to 17 March 2022 to such related parties is fair and reasonable insofar as the Shareholders are concerned.

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 (“MAR”), and is disclosed in accordance with the Company’s obligations under Article 17 of MAR.

For further information please visit https://www.powermetalresources.com/ or contact:

Power Metal Resources plc

Paul Johnson (Chief Executive Officer)

+44 (0) 7766 465 617

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