Mr. Keith Henderson reports

CLOSING OF ACQUISITION OF MINERAL PROPERTY INTERESTS IN BULGARIA

Velocity Minerals Ltd. has closed its share purchase and sale agreement with 1077076 B.C. Ltd., (TargetCo), and the shareholders of TargetCo, such that Velocity has acquired all of the outstanding shares of TargetCo in exchange for 18 million common shares of Velocity, with the effect that TargetCo is now a wholly owned subsidiary of Velocity. Velocity now holds (through TargetCo) options to acquire interests in the Tintyava property and the Ekuzya property located in southeastern Bulgaria. See Velocity's news releases of Feb. 6, 2017, and June 1, 2017, for full details of the acquisition and the related mineral property interests. In connection with the closing of the acquisition, Velocity's common shares will resume trading on the TSX Venture Exchange under the symbol VLC on July 25, 2017.

The following material changes also occurred in conjunction with closing of the acquisition:

1. The 18 million common shares of Velocity issued to the four shareholders of TargetCo are subject to a surplus escrow agreement (within the meaning of applicable TSX-V policies) to be released as to 5 per cent upon closing, 5 per cent upon six months after closing, an additional 10 per cent upon 12 months and 18 months following closing, an additional 15 per cent upon 24 months and 30 months following closing, and the balance of 40 per cent upon 36 months following closing. In addition, 600,000 shares of Velocity were issued to Henk van Alphen as a finder's fee for arranging the acquisition.
2. The concurrent private placement of Velocity units at 25 cents per unit has been closed, and an aggregate of 8,857,000 units were issued for total gross proceeds of $2,214,250. Each unit consists of one common share and one-half of one common share purchase warrant, with each whole warrant exercisable for 12 months at 40 cents per share, provided that in the event the closing price of Velocity's shares on the TSX-V is equal to or greater than 60 cents per share for 10 consecutive trading days at any time following four months after the date of closing, Velocity may reduce the remaining exercise period of the warrants to not less than 30 days following the date of such notice. Aggregate finders' fees of $94,448 and 377,790 finder warrants were paid by Velocity. Each finder warrant entitles the holder to acquire one share of Velocity at 25 cents over 24 months.
3. A total of 14 million previously issued warrants were transferred by the holders to the four vendors for no additional consideration. All of the 14 million warrants have been exercised by the vendors (at 7.5 cents) such that Velocity received exercise proceeds of $1.05-million. Subsequently, a total of five million of such shares were sold at market value. The remaining nine million shares are held in escrow pursuant to the terms of a value security escrow agreement to be released as to 10 per cent on closing, and an additional 15 per cent every six months thereafter over 36 months.
4. The existing holders of 7.5 million previously issued common shares of Velocity entered into lock-up agreements with Velocity, whereby those shares will be held in escrow and released as to one-third (2.5 million shares) on each of the sixth, 12th and 18th months following closing.
5. All of the directors of Velocity have resigned (except for Joseph Martin), and have been replaced by Keith Henderson, Gord Doerksen, Mark Cruise and Daniel Marinov. In addition, each of the officers of Velocity has resigned and has been replaced with Mr. Henderson as chief executive officer and president, Stuart Mills as vice-president, exploration, and Blaine Bailey as chief financial officer. Please refer to Velocity's news release of Feb. 6, 2017, for details of each of the new officers and directors.

Ekuzya property

Velocity (through a Bulgarian subsidiary of TargetCo) holds an option to acquire an undivided 50-per-cent legal and beneficial interest in the Ekuzya property free and clear of all liens and encumbrances in consideration for incurring $1-million (U.S.) in exploration expenditures over a two-year period, as to $500,000 (U.S.) in the first year and $500,000 (U.S.) in the second year; provided that, if after Velocity has incurred the expenditures and there is a delay of more than 180 days in effecting the transfer of the earned interest in the property to Velocity or if at any time prior thereto Velocity elects not to exercise the option, then Velocity's interest in the property will be limited to the obligation of Gorobso to pay Velocity a 5-per-cent gross value commission on all metals discovered on the property as a result of Velocity's exploration activities thereon.

Velocity has filed on SEDAR a technical report prepared under National Instrument 43-101 on the Ekuzya property. The technical report is written by James Hogg of Addison Mining Services Ltd. The Ekuzya property has an area of 2.13 square kilometres; is located within the Chala mining concession (held by Gorubso Kharzhali AD); and is located in southeast Bulgaria, about 230 kilometres by road, east-southeast of the capital Sofia. The Ekuzya property is situated south and adjacent to the currently operating Chala gold mine (operated by Gorubso). Gorubso's processing plant, including a cyanide tank leach plant and tailings management facility, is located at the town of Kardzhali, 35 kilometres by road from the Chala mine. The mining concession is valid until 2031. Ekuzya can be accessed year-round by four-wheel-drive vehicle through a collection of existing forestry and historical drill roads. The Chala mine office is located in the small village of Gorno Bryastovo, where mine staff totalling 210 employees operates three shifts per day in a year-round operation. The Chala mine site contains basic ore handling infrastructure, an underground explosives magazine, and various workshops for routine maintenance and repair. Run-of-mine ore is transported by trucks to Kardzhali for processing at Gorubso's processing plant prior to crushing, milling, gravity concentration and on-site cyanide-in-leach (CIL) extraction, elution, and production of gravity concentrate and dore.

To date, neither Velocity nor TargetCo has completed any exploration on the Ekuzya property, other than activities related to due diligence, data compilation and site visits. All the results described herein result from work completed by previous operators.

TargetCo has compiled all of the exploration data available within the Ekuzya property and has digitally captured the most significant information into a project database stored within a Micromine exploration and mining software system. Historical exploration within the Ekuzya property includes 79 base metal diamond core drill holes for 64,350 metres with no gold analysis and 17 gold diamond core drill holes for 15,095 metres.

The mineralization at the Ekuzya property is an intermediate sulphidation epithermal vein-type gold base metal deposit. Previous Soviet-style exploration appears to have been vigorous, systematic and based on a solid understanding of economic geology. The digital capture of these large data sets (more than 200 large format maps scanned and digitized) has enabled TargetCo to produce a reasonable model of mineralization within the Ekuzya property with the result that the structural control on mineralization has become apparent.

TargetCo has identified three target areas, named zone 5, zone 5a and Ekuzyata, where previous operators have reported significant gold results. The highest-priority target is the potentially open-pittable, stratabound epithermal vein and dissemination target at Ekuzyata. Previous trenching has identified a shallow dipping zone over a strike length of 500 metres and a downdip extent of at least 250 metres. Previous trenching returned multiple significant intercepts across the strike extent with 3.5 metres of six grams per tonne in the west, 10.8 metres of 2.2 grams per tonne in the centre of the target and 3.1 metres of 3.6 grams per tonne in the east. True thicknesses at Ekuzyata are at present difficult to ascertain with the current level of available data. The stratabound mineralization is present at multiple horizons, and the potential for stacked mineralization is considered to be good. Due diligence check sampling performed by the author of the technical report from reopened trenches confirmed the occurrence, approximate location and association of mineralization at the Ekuzyata target. The target was partially drill tested by a previous operator of the property, Asenovgrad Geoengineering EAD, with four wide-spaced shallow diamond drill holes, confirming the sporadic nature of the mineralized zone at least 250 metres down dip.

Exploration recommendations set out in the technical report for the first year of exploration include acquisition of satellite imagery and topographic data, DGPS (differential global positioning system) survey of historical exploration collars and trenches, soil sampling over the Ekuzyata target, systematic trenching of soil geochemistry anomalies, twinning of one drill hole, up to eight drill holes at target zone 5, and, if appropriate, drill testing of Ekuzyata soil and trench anomalies.

The recommended budget for the first year of exploration of $510,000 (U.S.) includes 1,000 metres of diamond core drilling after the completion of soil sampling and trenching.

Tintyava property

Velocity (through a Bulgarian subsidiary of TargetCo) holds an option to acquire an undivided 70-per-cent legal and beneficial interest in the Tintyava property, free and clear of all liens and encumbrances granted by Gorubso, in consideration for the payment of the $325,000 tender fee to the Ministry of Energy of the Republic of Bulgaria for an exploration and prospecting licence for Tintyava property. The option is exercisable for a period of six years by Velocity preparing (at its own cost) a preliminary economic assessment within the meaning of NI 43-101 on the Tintyava property.

James Hogg, MSc, BSc, MAIG, is the author of the technical report and an independent qualified person within the meaning of NI 43-101. Mr. Hogg has reviewed the scientific and technical information from the technical report that forms the basis of this news release and has approved the disclosure herein.

We seek Safe Harbor.