Formation Metals Announces $6,000,000 Private Placement

Rhea-AI Summary

Formation Metals (OTCQB:FOMTF) has announced a significant private placement to raise up to $6 million through two offerings. The company plans a non-brokered private placement of up to 10,810,810 LIFE Units at $0.37 per unit for gross proceeds of up to $4 million, and a flow-through private placement of up to 4,878,049 FT Units at $0.41 per unit to raise up to $2 million.

The funds will support Formation's 20,000-metre drill program at its flagship N2 Gold Project in Quebec, which hosts a historic resource of approximately 870,000 ounces of gold. The company has already commenced Phase 1 (10,000 metres) on September 25, 2025, targeting the "A" zone with ~522,900 ounces and the high-grade "RJ" zone.

Formation currently has working capital of ~C$5.0M with zero debt. If fully subscribed, the financings would increase the company's working capital to ~$10.5M, supporting its 2025-2026 exploration budget of ~$5.7M.

Positive

• Strong financial position with C$5.0M working capital and zero debt
• Historic gold resource of 870,000 ounces at N2 Gold Project
• Significant exploration potential with only 35% of strike drilled at A zone
• High-grade intercepts at RJ zone up to 51 g/t Au over 0.8 metres
• Additional base metal potential with copper and zinc intercepts

Negative

• Potential dilution from the issuance of new shares and warrants
• Historic resource estimates need to be updated to NI 43-101 compliance
• Up to 7% finder's fees may reduce net proceeds from offerings

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

Highlights:

• Formation has planned a 20,000 metre total multi-phase drill program at its flagship N2 Gold Project in Quebec, host to a global historic resource of ~870,000 ounces comprised of 18 Mt grading 1.4 g/t Au (~809,000 oz Au) across four zones (A, East, RJ-East, and Central)^2,3 and 243 Kt grading 7.82 g/t Au (~61,000 oz Au) across the RJ zone^2,4.

• Phase 1, consisting of a fully funded 10,000 metres, commenced on September 25, 2025. Phase 1 will target the "A" zone, a shallow, highly continuous, low-variability historic gold deposit with ~522,900 ounces of which only ~35% of strike has been drilled (>3.1 km open), and the "RJ" zone, host to high-grade intercepts from historical drill holes as high as 51 g/t Au over 0.8 metres², which was expanded by Agnico Eagle Mines in 2008 in the most recent drilling at the Property.

• The Company has working capital of ~C$5.0M with zero debt prior to the financing, putting it in a very strong financial position to execute its exploration programs. Inclusive of provincial tax credits from the Quebec government, Formation's exploration budget for 2025-2026 is set at ~$5.7M. The financings, if fully subscribed, would increase Formation's working capital to ~$10.5M.

VANCOUVER, BC / ACCESS Newswire / September 30, 2025 / Formation Metals Inc. ("Formation" or the "Company") (CSE:FOMO)(FSE:VF1)(OTCQB:FOMTF), a North American mineral acquisition and exploration company, is pleased to announce a non-brokered private placement (the "LIFEOffering") for up to 10,810,810 units (each, a "LIFE Unit") of the Company at $0.37 per LIFE Unit, pursuant to the listed issuer financing exemption under Part 5A of National Instrument 45-106 - Prospectus Exemptions ("NI 45-106"), as amended and supplemented by Coordinated Blanket Order 45-935 - Exemptions from Certain Conditions of the Listed Issuer Financing Exemption, for gross proceeds of up to $4,000,000. Each LIFE Unit will be comprised of one common share in the capital of the Company (a "LIFE Share") and one common share purchase warrant (a "LIFE Warrant"). Each LIFE Warrant will be exercisable to acquire one additional common share of the Company at an exercise price of $0.54 for a period of 36 months from the date of closing. The LIFE Units issued pursuant to the LIFE Offering will not be subject to a hold period in accordance with applicable Canadian securities laws.

There is an offering document (the "Offering Document") relating to the LIFE Offering that can be accessed under the Company's profile at www.sedarplus.ca and on the Company's website (www.formationmetalsinc.com). Prospective investors in the LIFE Offering should read the Offering Document before making an investment decision.

Concurrent with the LIFE Offering, the Company intends to complete a non-brokered private placement of up to 4,878,049 flow-through units of the Company ("FT Units") at a price of $0.41 per FT Unit to raise aggregate gross proceeds of up to $2,000,000 (the "FT Private Placement" and, together with the LIFE Offering, the "Offerings"). Each FT Unit will consist of one flow-through common share (a "FT Share") of the Company, and each FT Share shall qualify as a "flow-through share" as defined in section 66(15) of the Income Tax Act (Canada), and one transferable common share purchase warrant (a "FT Warrant"), with each Warrant entitling the holder to purchase one additional common share (a "Warrant Share") at an exercise price of $0.62 per Warrant Share for a period of two (2) years from the date of closing of the FT Private Placement.

All securities issued under the FT Private Placement will be subject to statutory hold periods expiring four months and one day from the date of closing of the FT Private Placement.

Closing of the Offerings may take place in one or more tranches as determined by the Company and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals, including approval of the Canadian Securities Exchange.

The Company may pay certain eligible finders a cash fee of up to 7% of the gross proceeds raised in respect of the Offerings from subscribers introduced by such finders to the Company. The Company may also issue to eligible finders such number of finder warrants (each, a "Finder Warrant") as is equal to 7% of the number of LIFE Units or FT Units sold under the Offerings to subscribers introduced by such finders to the Company. The Finder Warrants, to the extent they are issued, will match the terms of the LIFE Warrants and FT Warrants respectively.

The Company intends to use the net proceeds of the Offerings for fieldwork at the Company's exploration projects and, in the case of the net proceeds from the LIFE Offering, as more particularly set out in the Offering Document.

The Company also wishes to announce that it has cancelled its previously announced flow-through offering on September 22, 2025.

Project Summary

Comprising 87 claims totaling ~4,400 ha within the Abitibi sub province of Northwestern Quebec, Formation's flagship N2 Gold Project is an advanced gold project with a global historic resource of 877,000 ounces. There are six primary auriferous mineralized zones in total, each open for expansion along strike and at depth. Compilation and geophysical work by Balmoral Resources Ltd. (now Wallbridge Mining) from 2010 to 2018 generated numerous targets that have not yet been investigated with diamond drilling.

The drill program is designed to focus on discovery drilling at new high-potential targets along the mineralization strikes at the "A", "RJ" and "Central" zones in the northern part of the Property in order to discover new auriferous trends and unlock new zones of gold mineralization. The program will also focus on high-priority infilling and expansion targets in these zones to significantly enhance the auriferous zones identified to-date (Figure 1).

Historical highlights from the top two priority zones include:

• A Zone: A shallow, highly continuous, low-variability historic gold deposit with ~522,900 ounces identified at a grade of 1.52 g/t Au. ~15,000 metres have been drilled historically across 1.65 km of strike, with over 3.1 km of strike remaining to be tested. 84% of historical drillholes intercepted auriferous intervals including up 1.7 g/t over
  35 m.

• RJ Zone: a high-grade historic gold deposit with ~61,100 ounces identified at a grade of 7.82 g/t Au, with high-grade intercepts from historical drill holes as high as 51 g/t Au over 0.8 metres and 16.5 g/t Au over 3.5 metres². This zone was the target of the most recently drilling at the Property by Agnico-Eagle Mines in 2008, when the price of gold was ~US$800/oz. Only ~900 metres of strike has been drilled, with 4.75+ km of strike remaining to be tested.

Figure 2 - PDDH design for the complete 20,000 metre Drill Program.

Figure 3 - Property overview summarizing historical work completed at each of the six mineralized zones and their respective historical resource.

The Company also believes that N2 has significant base metal potential, where it recently completed a revaluation process which revealed significant copper and zinc intercepts within historic drillholes known to have significant gold grades (>1 g/t Au). Assay results range from 200 to 4,750 ppm and 203 ppm to 6,700 ppm, for copper and zinc, respectively, indicating strong potential for elevated base metal (Cu-Zn) concentrations across the property, specifically at the A and RJ zones. Property wide geology at N2 features volcanic and sedimentary rocks formed in regional anticlinal and synclinal flexures. Three principal deformation structures (Figure 1), oriented along the known NW-SE to WNW-ESE structural trends typical of VMS deposits in the Matagami region, function as critical geologic controls for mineralization on the property.

For the 2025 exploration season, Formation plans to concentrate its efforts on the northern part of N2, targeting gold deposit expansion and discovery along identified zones and fault systems associated with the main deformation features (specifically WNW-ESE trend), with IP surveys and drilling planned to model mineralized zones that will hopefully contribute to an updated NI-43 101 compliant resource. Formation will also look to further review historic base metal assays from older drill core and undertake additional work in 2025 to assess the property's copper and zinc potential.

Qualified person

The technical content of this news release has been reviewed and approved by Mr. Babak Vakili Azar, P.Geo., an independent contractor and a qualified person as defined by National Instrument 43-101. Historical reports provided by the optionor were reviewed by the qualified person. The information provided has not been verified and is being treated as historic.

About Formation Metals Inc.

Formation Metals Inc. is a North American mineral acquisition and exploration company focused on the development of quality properties that are drill-ready with high-upside and expansion potential. Formation's flagship asset is the N2 Gold Project, an advanced gold project with a global historic resource of ~870,000 ounces (18 Mt grading 1.4 g/t Au (~809,000 oz Au) across four zones (A, East, RJ-East, and Central)^2,3 and 243 Kt grading 7.82 g/t Au (~61,000 oz Au) across the RJ zone^2,4) and six mineralized zones, each open for expansion along strike and at depth including the "A" zone, of which only ~35% of strike has been drilled (>3.1 km open), and the "RJ" zone, host to historical high-grade intercepts as high as 51 g/t Au over 0.8 metres.

FORMATION METALS INC.

Deepak Varshney, CEO and Director

For more information, please call 778-899-1780, email dvarshney@formationmetalsinc.com or visit www.formationmetalsinc.com.

Neither the Canadian Securities Exchange nor its Regulation Services Provider accepts responsibility for the adequacy or accuracy of this release.

Notes and References:

1. Readers are cautioned that the geology of nearby properties is not necessarily indicative of the geology of the Property.

2. The above referenced resource estimates do not have a category, are considered historical in nature, and are based on prior data prepared by a previous property owner, and do not conform to current CIM categories.

   While the Company considers the estimates to be reliable, a qualified person has not done sufficient work to classify the historical estimates as current resources in accordance with current CIM categories and the Company is not treating the historical estimates as a current resource. A 0.5 g/t Au cut-off was used in the preparation of the historical estimates with a minimum 2.5 metre mining width.

   Significant data compilation, re-drilling, re-sampling and data verification may be required by a qualified person before the historical estimates can be classified as current resources. There can be no assurance that any of the historical mineral resources, in whole or in part, will ever become economically viable. In addition, mineral resources are not mineral reserves and do not have demonstrated economic viability. The Company is not aware of any more recent estimates prepared for the N2 Property.

3. Needham, B. (1994), 1993 Diamond Drill Report, Northway Joint Venture, Northway Property; Cypress Canada Inc.; 492 pages.

4. Guy K. (1991), Exploration Summary May 1, 1990 to May 1, 1991 Vezza Joint Venture Northway Property; Total Energold; 227 pages.

Forward-looking statements:

This news release includes "forward-looking statements" under applicable Canadian securities legislation, including statements respecting: the Company's plans for the Property and the expected timing and scope of the 2025 drilling program at the Property; the Company's goal of delivering a near-surface multi-million-ounce deposit the Property; the Company's anticipated timeline with respect to the Application for Autorisation de Travaux d'exploration à Impacts (ATI) to the Ministère des Ressources naturelles et des Forets (MERN); the Company's view that the Property has the potential for over three million ounces of gold; the 7,500-metre drilling program marking the beginning of the Company's pursuit of that goal; and statements respecting the Offerings, the timing thereof andthe expected use of proceeds therefrom. Such forward-looking information reflects management's current beliefs and is based on a number of estimates and/or assumptions made by and information currently available to the Company that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors that may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Readers are cautioned that such forward-looking statements are neither promises nor guarantees and are subject to known and unknown risks and uncertainties including, but not limited to, general business, economic, competitive, political and social uncertainties, uncertain and volatile equity and capital markets, lack of available capital, actual results of exploration activities, environmental risks, future prices of base and other metals, operating risks, accidents, labour issues, delays in obtaining governmental approvals and permits, and other risks in the mining industry.

The Company is presently an exploration stage company. Exploration is highly speculative in nature, involves many risks, requires substantial expenditures, and may not result in the discovery of mineral deposits that can be mined profitably. Furthermore, the Company currently has no reserves on any of its properties. As a result, there can be no assurance that such forward-looking statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements.

No Offer or Solicitation to Purchase Securities in the United States

This press release does not constitute or form a part of any offer or solicitation to purchase or subscribe for securities in the United States. The securities referred to herein have not been and will not be registered under the Securities Act of 1933, as amended (the "Securities Act"), or with any securities regulatory authority of any state or other jurisdiction in the United States, and may not be offered or sold, directly or indirectly, within the United States or to, or for the account or benefit of, U.S. persons, as such term is defined in Regulation S under the Securities Act ("Regulation S"), except pursuant to an exemption from or in a transaction not subject to the registration requirements of the Securities Act.

Not for distribution to United States newswire services or for dissemination in the United States. This news 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 or to U.S. persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available. This news release shall not constitute an offer to sell or the solicitation of an offer to buy in the United States or to, or for the account or benefit of, persons in the United States or U.S. Persons nor shall there by any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

SOURCE: Formation Metals

View the original press release on ACCESS Newswire

FAQ

How much is Formation Metals (FOMTF) raising in their September 2025 private placement?

Formation Metals is raising up to $6 million through two offerings: $4 million through LIFE Units at $0.37/unit and $2 million through flow-through units at $0.41/unit.

What is the size of Formation Metals' N2 Gold Project's historic resource?

The N2 Gold Project has a global historic resource of ~870,000 ounces, comprising ~809,000 oz Au at 1.4 g/t across four zones and ~61,000 oz Au at 7.82 g/t in the RJ zone.

What is Formation Metals' current working capital position before the financing?

Formation Metals has working capital of approximately C$5.0 million with zero debt prior to the financing.

How will Formation Metals use the proceeds from the September 2025 private placement?

The proceeds will fund the company's 20,000-metre drill program at the N2 Gold Project in Quebec and general fieldwork at the company's exploration projects.

What are the terms of Formation Metals' LIFE Units in the private placement?

Each LIFE Unit at $0.37 includes one common share and one warrant exercisable at $0.54 for 36 months with no hold period under Canadian securities laws.