FCLI Full Circle Lithium Corp

Full Circle Lithium Corp. (TSXV: FCLI) (formerly ESG Capital 1 Inc., “ESG”, the “Company”, or the “Resulting Issuer”) is pleased to announce the closing of its previously announced qualifying transaction (the “Qualifying Transaction”) resulting in the reverse takeover of the Company by Full Circle Lithium Inc. (“Full Circle”), a private company incorporated under the laws of Ontario.

It is anticipated that the common shares of the Resulting Issuer will commence trading on the TSX Venture Exchange (the “Exchange”) under the ticker symbol “FCLI” on or about May 1, 2023 following the issuance by the Exchange of its final bulletin in respect of the Qualifying Transaction.

The Transaction

Effective on April 19, 2023, as a condition to the completion of the Qualifying Transaction, ESG changed its name to “Full Circle Lithium Corp.” and consolidated its share capital (the “ESG Consolidation”) on the basis of approximately 1.17 (old) common shares for 1 (new) common share. Immediately following the ESG Consolidation, ESG had an aggregate of 3,500,000 common shares outstanding.

Pursuant to the terms of the Qualifying Transaction, a wholly-owned subsidiary of ESG and Full Circle completed an amalgamation (the “Amalgamation”) under the Business Corporations Act (Ontario) to form Full Circle Canada Inc., a wholly-owned subsidiary of the Resulting Issuer, and all of the issued and outstanding securities of Full Circle were exchanged for securities of the Resulting Issuer on a one-to-one basis pursuant to the terms and conditions of a business combination agreement dated January 17, 2023 (the “Definitive Agreement”), a copy of which is available under the Company’s profile on SEDAR at www.sedar.com.

Further to ESG’s news releases dated November 7, 2022, January 17, 2023 and January 18, 2023, ESG and Full Circle raised aggregate gross proceeds in the amount of $9,782,350 (the “Concurrent Financing”) through the issuance of an aggregate of 12,185,786 subscription receipts of Full Circle (“Full Circle Subscription Receipts”) and 1,789,000 subscription receipts of ESG (the “ESG Subscription Receipts”, together with the Full Circle Subscription Receipts, the “Subscription Receipts”).

Concurrent with the closing of the Qualifying Transaction, the ESG Subscription Receipts were converted into 1,789,000 Resulting Issuer common shares (“Resulting Issuer Shares”) and 894,500 common share purchase warrants to purchase Resulting Issuer Shares pursuant to the terms of a subscription receipt agreement between ESG, Clarus Securities Inc. and PowerOne Capital Markets Limited (the “Agents”), and Marrelli Trust Company Limited (“MTCL”) dated January 17, 2023 (the “ESG SR Agreement”). The Full Circle Subscriptions Receipts were converted into 12,185,786 Full Circle common shares and 6,092,893 Full Circle common share purchase warrants pursuant to the terms of a subscription receipt agreement between the Full Circle, the Agents and MTCL dated January 17, 2023 (the “Full Circle SR Agreement”), which were subsequently exchanged for equivalent securities of the Resulting Issuer on a one-for-one basis. In addition, the escrowed proceeds were released in accordance with the provisions of the ESG SR Agreement and Full Circle SR Agreement.

Following the conversion of the Subscription Receipts and the completion of the Qualifying Transaction, the Resulting Issuer will have issued or have outstanding:

a) approximately 68,328,786 Resulting Issuer shares (“Resulting Issuer Shares”) outstanding comprised of the following:

• 50,854,000 Resulting Issuer Shares issued to former holders of common shares of Full Circle;
• 13,974,786 Resulting Issuer Shares issued to former holders of the Subscription Receipts; and
• 3,500,000 Resulting Issuer Shares held by the former shareholders of ESG.  

b) an aggregate of 3,500,000 options of the Resulting Issuer to purchase Resulting Issuer Shares;

c) an aggregate of 6,987,393 warrants of the Resulting Issuer exercisable for Resulting Issuer Shares (the “Resulting Issuer Warrants”), with each Resulting Issuer Warrant exercisable at a price of $1.10 for a period of 24 months commencing upon satisfaction of the escrow conditions in the Full Circle SR Agreement and the ESG SR Agreement;

d) an aggregate of 1,314,400 Resulting Issuer Warrants exercisable at a price of $0.25 for a period of 24 months from the closing date of the Qualifying Transaction; and

e) an aggregate of 869,495 compensation options (the “Agents’ Options”) issued to the Agents in connection with the Concurrent Financing, with each Agents’ Option exercisable for one Resulting Issuer Share and one half of one Resulting Issuer Warrant.

Further details regarding the Qualifying Transaction can be found in the filing statement of the Resulting Issuer dated April 14, 2023 (the “Filing Statement”) as corrected per the “Correction to the Filing Statement” section below, a copy of which is available under the Company’s profile on SEDAR at www.sedar.com.

Escrowed Shares

On completion of the Qualifying Transaction, certain Principals (as defined in the policies of the Exchange) of the Resulting Issuer holding an aggregate of 17,826,000 Resulting Issuer Shares are subject to escrow in accordance with Policy 5.4 – Escrow, Vendor Consideration and Resale Restrictions of the Exchange (“Policy 5.4”), to be released over a period of 18 months following Final Acceptance. Additionally, an aggregate of 1,500,000 Resulting Issuer Options held by certain Principals of the Resulting Issuer are subject to escrow in accordance with Policy 5.4. Further, former shareholders of the Company entered into a CPC Escrow Agreement (the “CPC Escrow Agreement”) with the Exchange and MTCL, as escrow agent, in respect of approximately 2,264,955 Resulting Issuer Shares, to be released over a period of 18 months following the dissemination of the Final Exchange Bulletin. In addition, on completion of the Qualifying Transaction, certain non-Principal former shareholders of Full Circle holding an aggregate of 14,784,000 Resulting Issuer Shares are subject to seed share resale restrictions (“SSRR”) pursuant to section 10 of Policy 5.4 and certificates evidencing these shares shall bear a legend as required under Policy 5.4. For a detailed breakdown about the escrow terms for these securities, please consult the Company’s Filing Statement on SEDAR.

In addition to the foregoing Exchange restrictions, all 50,854,000 Resulting Issuer shares held by Full Circle shareholders shall be subject to voluntary escrow restrictions, with staged releases of such voluntarily escrowed securities occurring in stages over a period of three years. Such voluntary restrictions above are in addition to the restrictions mandated by the applicable securities laws and the policies of the Exchange, including the escrow described above. For a detailed breakdown about the voluntary escrow terms, please consult the Company’s Filing Statement on SEDAR.

Board of Directors and Executive Management

Following the completion of the Qualifying Transaction, the following individuals comprise the directors and officers of the Company:

Carlos Vicens	-	Chief Executive Officer and Director
Tom Currin	-	Chief Operating Officer
Dr. William Bourcier	-	Chief Technology Officer
Omar Gonzalez	-	Chief Financial Officer & Secretary
Paul Fornazzari	-	Non-Executive Chairman
Franco Mignacco	-	Director
Mike Cosic	-	Director
Orlee Wertheim	-	Director

Correction to the Filing Statement

The Company notes that the table set out under the heading Part III – Information Concerning the Resulting Issuer - Options on page 67 of the Filing Statement dated April 14, 2023, mistakenly double-counts 1,500,000 options held by officers and directors of the Resulting Issuer. The correct number of options of the Resulting Issuer is set out elsewhere in the Filing Statement, including under the heading Part III – Information Concerning the Resulting Issuer - Pro Forma Fully Diluted Share Capital chart which appears on page 55. A corrected version of the chart is set out below:

Optionee	Number of Resulting Issuer Options	Exercise Price	Expiry Date
Holders of ESG Options	393,162(1)	CAD$0.23	12 months from the completion of the Transaction (307,692 CPC Stock Options);September 15, 2023 (85,470 ESG Options granted to Haywood Securities Inc.)
Executive officers of the Resulting Issuer	1,062,500	CAD$0.25	August 2, 2027
Directors of the Resulting Issuer	437,500	CAD$0.25	August 2, 2027
Directors, Employees and Consultants of the Resulting Issuer	2,000,000	CAD$0.70	Five years from the date of the completion of the Transaction
Past Employees of Full Circle	Nil	Nil	N/A
TOTAL	3,893,162

Note:

(1) On a post-Consolidation basis, assuming no exercise of the ESG Options prior to completion of the Transaction.

The Company further notes that all options of ESG were exercised prior to the completion of the Qualifying Transaction, meaning there are 3,500,000 options to purchase Resulting Issuer Shares currently outstanding.

About Full Circle Lithium Corp.

With a fully permitted lithium processing plant in Georgia, USA and a complement of experts, Full Circle is a lithium processor focused on lithium and battery materials reintegration to meet the demand for crucial battery-grade raw materials, utilizing proprietary technology and know-how. Full Circle is focused on three complementary battery material processing divisions: battery recycling from end-of-life lithium-ion batteries, lithium feedstock recycling from industrial and chemical feedstock, and lithium refinery from upstream feedstock. Additional information regarding Full Circle Lithium Corp. is available on SEDAR at www.sedar.com under the Company's profile and its website www.fullcirclelithium.com.

Auditors

MNP LLP will continue as auditors of the Company following closing of the Qualifying Transaction.

Additional Information for Shareholders

The Company’s transfer agent, MTCL, will be mailing Direct Registration System statements to all former securityholders of Full Circle (other than for those that are required to be in certificated form) setting out each holder’s shareholdings. The CUSIP number for the Resulting Issuer Shares is 359917101.

Former registered holders of pre-Consolidation common shares of ESG will be receiving by mail, from MTCL, a letter of transmittal with instructions on how to remit their former common shares of ESG for Resulting Issuer Shares.

For further information, please refer to the Filing Statement posted to the Company’s issuer profile on SEDAR at www.sedar.com, as well as the press releases dated November 7, 2022, January 17, 2023, January 18, 2023 and April 19, 2023.

For more information, please contact:

Carlos Vicens – CEO & Directorcvicens@fullcirclelithium.com

Forward-Looking Statements

This press release may contain certain forward-looking information and statements (“forward-looking information”) within the meaning of applicable Canadian securities legislation, that are not based on historical fact, including without limitation statements containing the words “believes”, “anticipates”, “plans”, “intends”, “will”, “should”, “expects”, “continue”, “estimate”, “forecasts” and other similar expressions. Readers are cautioned to not place undue reliance on forward-looking information. Actual results and developments may differ materially from those contemplated by these statements. The Company undertakes no obligation to comment analyses, expectations or statements made by third-parties in respect of the Company, its securities, or financial or operating results (as applicable). Although the Company believes that the expectations reflected in forward-looking information in this press release are reasonable, such forward-looking information has been based on expectations, factors and assumptions concerning future events which may prove to be inaccurate and are subject to numerous risks and uncertainties, certain of which are beyond the Company’s control, including the risk factors discussed in the Filing Statement which are incorporated herein by reference and are available through SEDAR at www.sedar.com. The forward-looking information contained in this press release are expressly qualified by this cautionary statement and are made as of the date hereof. The Company disclaims any intention and has no obligation or responsibility, except as required by law, to update or revise any forward-looking information, whether as a result of new information, future events or otherwise.

All information contained in this news release with respect to ESG and Full Circle Lithium Inc. 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. For further information regarding the Qualifying Transaction, please contact: Share numbers noted in this press release may not match the numbers disclosed in the Filing Statement due to rounding pursuant to the process of completing the consolidation and the exercise of convertible securities of ESG immediately prior to completion of the Transaction. 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 release.