Mr. Graham Harris reports

MILLENNIAL LITHIUM CLOSES PURCHASE OF PASTOS GRANDES LITHIUM PROJECT IN ARGENTINA AND CLOSES CONCURRENT FINANCING FOR PROCEEDS OF $4,875,000

Millennial Lithium Corp. has closed its acquisition of the Pastos Grandes lithium project in Argentina and has also closed its concurrent private placement financing. The acquisition constituted a fundamental acquisition under the policies of the exchange and was first announced in a news release on July 19, 2016.

Closing of the acquisition of the Pastos Grandes lithium project

Millennial has received exchange approval for, and closed, its acquisition of the project.

The company entered into a definitive agreement with Jorge Enrique Moreno and Alba Silvia Salas dated Sept. 16, 2016, to acquire a 100-per-cent interest in and to the project. The definitive agreement replaced an earlier agreement disclosed in the July 19, 2016, news release.

Under the terms of the definitive agreement, Millennial will complete its purchase of a 100-per-cent interest in the project in consideration of the following payments and share issuances to the vendor:

• Paying to the vendors a $200,000 (U.S.) deposit on execution of the initial agreement (completed);
• Paying to the vendors $500,000 (U.S.) (first instalment) on closing (completed) and issuing 500,000 common shares to the vendors (completed);
• Paying, on April 6, 2017, $500,000 (U.S.) (second instalment) to the vendors and issuing to the vendors $500,000 (U.S.) worth of the company's common shares;
• Making exploration expenditures of $1.6-million (U.S.) on or before Sept. 16, 2017;
• Paying to the vendors $1-million (U.S.) (final payment) on or before Oct. 6, 2017.

The initial shares issued to the vendors under the deposit are subject to a hold period expiring on Jan. 17, 2017. The shares issued to the vendors in the second instalment will be subject to an exchange hold period expiring four months from their date of issuance.

A finder's fee on the project of 5 per cent of all cash payments paid and shares issued to the vendors is payable, to Synergy Resource Capital Pty. Ltd., as those cash payments are paid and as those shares are issued. Accordingly, the finder's fee is payable as follows:

• Upon payment of the deposit above, $10,000 (U.S.) payable to the finder (paid);
• Upon payment of the first instalment, $25,000 (U.S.) payable to the finder (paid) and issuance to the finder of 25,000 shares (the closing finder's shares) of the company (issued);
• Upon payment of the second instalment, $25,000 (U.S.) payable to the finder and issuance to the finder of 25,000 shares of the company;
• Upon payment of the final payment, $50,000 (U.S.) payable to the finder.

All shares issued to the finder, including the closing finder's shares, are subject to an exchange hold period expiring four months from their date of issuance. The hold period on the closing finder's shares expires on Jan. 17, 2017.

The project is subject to a royalty equal to 1.5 per cent of the gross annual sales of lithium from the project net of value-added taxes and other taxes applicable to the sale of lithium. The royalty comes into effect on Oct. 6, 2019. At any time until Oct. 6, 2019, the company can terminate the right of the vendors to the royalty in consideration of a payment in the amount of $3-million (U.S.) to the vendors.

The project is strategically located within the Argentine portion of the lithium triangle, which is host to some of the world's largest lithium resources. The project is approximately 1,200 hectares in size and ideally situated in the centre of the Pastos Grandes Salar in Salta, Argentina. The region exhibits significant lithium and potassium brines, and, historically, the project has been tested by surface geochemical sampling, magnetotelluric (MT) surveying, CSAMT, vertical electrical sounding (VES) geophysical surveying, and by four pumping wells testing and measuring brine flows in aquifers, with significant lithium and potassium assays. Millennial is planning to continue with exploration and development of the project, and expects to report on such exploration plans in the coming weeks.

Closing of the concurrent financing

The company has closed its private placement financing of 7.5 million units at 65 cents per unit for proceeds of $4,875,000. Each unit comprises one common share and one-half of one share purchase warrant. Each whole share purchase warrant is exercisable for a period of two years from closing at an exercise price of $1.

The units and any common shares of the company issued upon exercise of the warrants are subject to a four-month hold period expiring on Jan. 17, 2017.

Commissions of up to 6 per cent, payable in cash or units at the finder's option, have been paid in connection with a portion of the financing. This resulted in the payment of $106,938.20 in cash and the issuance of 164,137 units.

All units issued to the finders and any common shares of the company issued upon exercise of the warrants in their units are subject to a four-month hold period expiring on Jan. 17, 2017.

Proceeds of the financing are to be used to meet the company's obligations under the definitive agreement, including financing required exploration expenditures on the project.

This news release has been reviewed by Brent Butler, director, qualified person as that term is defined in National Instrument 43-101.

We seek Safe Harbor.