Mr. Andrew Lee reports

DEEPROCK MINERALS INC. ANNOUNCES ARRANGEMENT AGREEMENT, INFORMATION CIRCULAR AND TECHNICAL REPORTS FOR SPIN-OFF AND REVERSE TAKEOVER WITH ALLIED CRITICAL METALS CORP.

Further to the news release dated June 14, 2024, Deeprock Minerals Inc. has entered into the definitive agreement signed Oct. 23, 2024, with effect as of Sept. 30, 2024, with Allied Critical Metals Corp. In addition, the company has also: (1) obtained an interim court order for approval of the plan of arrangement under the arrangement agreement; (2) called an annual general and special meeting of shareholders on Thursday, Nov. 21, 2024, at 10 a.m. Pacific Time, to approve the arrangement and other annual general and special business as more particularly set out in the company's management information circular dated Oct. 23, 2024; and (3) publicly filed the technical reports in respect of ACM's two tungsten mineral properties, including the maiden mineral resource estimate for the Borralha tungsten project.

Highlights:

• Arrangement agreement signed for Deeprock's consolidation and name change, spinout, reverse takeover amalgamation, and continuation to Cayman;
• Interim court order obtained on Oct. 21, 2024;
• Meeting called on Nov. 21, 2024, at 10 a.m. Pacific Time, to approve arrangement and other annual general and special business;
• Circular describing the arrangement and business of the meeting being delivered to Deeprock securityholders;
• Filed technical reports for ACM's two tungsten properties, including the maiden mineral resource estimate of the Borralha tungsten project.

The arrangement agreement provides the general terms and conditions of the spinout transaction of Deeprock and subsequent reverse takeover of the company by ACM under the arrangement, pursuant to the policies of the Canadian Securities Exchange and applicable securities laws. The company received its interim order of the British Columbia Supreme Court in respect of the arrangement on Oct. 21, 2024. Assuming approval of the arrangement at the meeting on Nov. 21, 2024, the company will seek a final order of the court for approval of the arrangement on Nov. 27, 2024,. which would allow for completion of the transactions on or after Nov. 27, 2024. Trading in the common shares of Deeprock will remain halted until completion of the transaction.

The circular is being delivered to shareholders and warrantholders of the company of record on the record date of Oct. 1, 2024. The particulars of the matters to be considered at the meeting are described in the circular, which is publicly available under the company's profile on SEDAR+.

In addition, the company is also pleased to announce that it has publicly filed the technical report for the maiden mineral resource estimate of ACM's Borralha tungsten project entitled "Technical Report on the Borralha Property, Parish of Salto, District of Vila Real, Portugal," dated effective July 31, 2024, signed Oct. 1, 2024. The company also publicly filed the technical report for ACM's Vila Verde tungsten project entitled "Technical Report on the Vila Verde Property, District of Vila Real, Portugal," dated effective July 30, 2024, and signed Oct. 1, 2024. The Borralha technical report and the Vila Verde technical report were prepared and written by J. Douglas Blanchflower, PGeo (PTP No. 1002071), in accordance with National Instrument 43-101 (Standards for Disclosure of Mineral Projects), and are publicly available under the company's profile on SEDAR+.

As described in the Borralha technical report, Borralha includes estimated mineral resources based on a cut-off grade of 0.10 per cent WO3 having reasonable prospects for eventual economic extraction with a 0.1-per-cent WO3 grade-volume shell with less than 5,000-cubic-metre volume excluded, as follows:

• Indicated resources comprised 4.4 million tonnes grading 0.22 per cent WO3, 99 parts per million tin, 809 ppm copper and 5.1 ppm silver;
• Inferred resources comprised 6.0 million tonnes grading 0.20 per cent WO3, 83 ppm tin, 681 ppm copper and 4.7 ppm silver.

Allied Critical Metals is a private company incorporated under the laws of Ontario, Canada, having a registered office in Toronto, Ont., which is engaged in the acquisition, exploration and potential development of tungsten projects in Portugal. ACM owns, through its wholly owned Portuguese subsidiary, ACM Tungsten Unipessoal Lda. (PortCo), a Portuguese company named Pan Metals Unipessoal Lda., which beneficially owns 90 per cent of two historical and established Portuguese tungsten projects: the Borralha tungsten project and the Vila Verde tungsten project. ACM has the right to purchase the remaining 10 per cent of the tungsten properties at a discount. Borralha is composed of a mining licence that allows for production of up to 150,000 tonnes per year of mineralized material covering an area of 382.5 hectares (3.8 square kilometres). Vila Verde is composed of an experimental exploration licence area covering 1,400 hectares (14 square kilometres). Both properties were past-producing mines which have excellent infrastructure, including paved and gravel roads, electricity, water, nearby skilled labour, and the ability to use existing waste dumps.

ACM has raised approximately $3.5-million in equity financing over the past 18 months, of which over $3.25-million has been spent on 3,685 metres of drilling and other exploration and the acquisition of the tungsten projects, which include a recent aggregate investment of an approximately $480,000 strategic investment by Majestic Gold Corp. and some of its significant shareholders. Majestic has over 13 years experience itself in building and operating underground and open-pit mines. ACM believes its relationship with Majestic will be helpful as ACM progresses its projects through exploration and development toward the goal of eventual production.

The transaction

The company intends to complete the transaction pursuant to a plan of arrangement under the arrangement agreement, which will include the following steps:

1. Consolidation and name change: The company will consolidate all of its issued and outstanding common shares on a one-for-40 basis and change its name to Allied Critical Metals Inc. or such other name as may be determined by ACM, which is acceptable to the exchange.
2. Spinout: The company will incorporate a wholly owned subsidiary (Sub1), transfer all of its assets to Sub1 and then transfer all of its common shares of Sub 1 to the Deeprock shareholders pro rata in proportion to their ownership of Deeprock.
3. Concurrent financing: ACM shall complete a concurrent private placement equity financing of units at a price of 40 cents per unit to raise gross proceeds of up to $7.5-million, and each unit will be composed of one common share of ACM and one-half common share purchase warrant of ACM, wherein each warrant will be exercisable for a period of 24 months from the date of issuance at a price of 60 cents per share.
4. Reverse takeover amalgamation: ACM will amalgamate as a three-cornered amalgamation with a second newly incorporated wholly owned subsidiary of the company (Sub2) to form an amalgamated company (Amalco) as a wholly owned subsidiary of the company, named ACM Holdings Ltd. or such other name as determined by ACM, and the shareholders of ACM will transfer all of their common shares of ACM to the company in consideration for postconsolidation common shares of the company as the resulting issuer on a one-for-one basis as a reverse takeover of the postconsolidation company, and the business of ACM shall become the business of the resulting issuer.
5. Continuation to Cayman: The resulting issuer will vertically amalgamate with its wholly owned Amalco after it has continued its existence from Ontario to British Columbia, and then the amalgamated resulting issuer shall continue its existence from British Columbia to the Cayman Islands, and the common shares of the resulting issuer will be listed and posted for trading on the exchange as a mining issuer.

Resulting issuer capital structure

Assuming completion of the transaction with a minimum concurrent financing of $1.5-million at 40 cents per unit, the resulting issuer will have approximately 78,898,790 common shares issued and outstanding, as well as 2,494,525 warrants, a number of brokers warrants exercisable at 40 cents and no options. The 2,494,525 warrants are composed of 197,400 warrants exercisable at 10 cents until May 15, 2025, to Feb. 15, 2026, 422,125 warrants at $2.40 until Jan. 19, 2025, to June 13, 2026, and 1,875,000 warrants at the listing price until 24 months after listing.

Assuming completion of the transaction with a maximum concurrent financing of $7.5-million at 40 cents per unit, the resulting issuer will have approximately 93,898,790 common shares issued and outstanding, as well as 9,994,525 warrants, a number of brokers warrants exercisable at 40 cents and no options. The 9,994,525 warrants are composed of 197,400 warrants exercisable at 10 cents until May 15, 2025, to Feb. 15, 2026, 422,125 warrants at $2.40 until Jan. 19, 2025, to June 13, 2026, and 9,375,000 warrants at the listing price until 24 months after listing.

Escrow conditions

RI shares issued pursuant to the amalgamation shall be subject to resale restrictions pursuant to the policies of the exchange, RI shares issued to insiders of the resulting issuer shall be subject to escrow in accordance with the policies of the exchange and RI shares issued to certain other investors in ACM shall be subject to other resale restrictions. RI shares issued in exchange for ACM shares issued under the concurrent financing shall be free trading and not be subject to resale restrictions, escrow or hold periods.

Subject to the policies of the exchange and applicable securities laws, upon closing of the transaction:

• A total of 25.5 million common shares of the resulting issuer held by principals and other founders of the resulting issuer will be subject to escrow wherein 10 per cent of the shares will be released on closing and 15 per cent will be released every six months thereafter over 36 months.
• A total of 11,173,125 common shares of the resulting issuer held by prior owners of the tungsten properties are expected to be subject to escrow wherein 10 per cent of the shares will be released on closing and 15 per cent will be released every six months thereafter over 36 months.

Concurrent financing

Prior to completion of the transaction and as a condition precedent to the obligations of the company, ACM intends to complete a concurrent financing to raise aggregate gross proceeds of up to $7.5-million by way of a private placement of units of ACM at a price of 40 cents per unit. Each unit will be composed of one common share of ACM and one-half common share purchase warrant of ACM, and each warrant will entitle the holder to acquire an ACM share at a price per ACM share of 60 cents for a period of 24 months from the date of issuance. On closing of the transaction, RI shares issued in exchange for ACM shares issued under the concurrent financing shall be free trading and not be subject to resale restrictions, escrow or hold periods.

ACM and the company intend to use the net proceeds of the concurrent financing to finance the costs of the transaction, for the recommended work programs described in the technical reports and for general working capital expenses of the resulting issuer, as more particularly described in the circular.

Commissions and finders' fees

In conjunction with the concurrent financing, ACM intends to pay a finder's fee on closing, subject to the policies of the exchange, of cash commissions on the gross proceeds from purchasers under the concurrent financing introduced by finders and a number of common share purchase warrants equal to a percentage of the number of units issued to purchasers under the concurrent financing introduced by finders. Each broker warrant will be exercisable into an RI share for two years from the date of issuance at the listing price.

Related-party transaction

As described in the company's news release dated June 14, 2024, the transaction is a related-party transaction under Multilateral Instrument 61-101 (Protection of Minority Shareholders in Special Transactions) because each of the company and ACM share a common director (Andrew Lee) and two common officers (Mr. Lee and Keith Margetson). However, the company is exempt under Section 5.5(b) of MI 61-101 from the requirement to obtain formal valuation because the company is not listed on a specified market. However, the company does intend to seek majority of the minority shareholder approval and general corporate shareholder approval for the transaction at the meeting pursuant to the circular in respect of the transaction in accordance with the policies of the exchange and applicable securities laws.

Exchange listing

Upon completion of the transaction, the resulting issuer will own 100 per cent of Amalco, which will own 100 per cent of PortCo, which owns 100 per cent of PanMetals, and PanMetals owns 90 per cent of the tungsten properties with the right to acquire the remaining 10 per cent. Upon closing, the resulting issuer expects to list on the exchange as a mining issuer, subject to exchange approval.

Conditions

Completion of the transaction is subject to customary conditions precedent, including:

1. Absence of any material adverse effect on the financial or operational condition of the assets or business of each of the parties to the arrangement agreement;
2. Completion and delivery to Deeprock of the title opinion in respect of the tungsten projects;
3. Representations and warranties of each of the ACM and Deeprock contained in the arrangement agreement being true and correct as of the closing date, and there being no material breach of ACM or Deeprock of the representations, warranties and covenants in the arrangement agreement;
4. ACM and Deeprock shall be satisfied, acting reasonably, that the tungsten projects and ACM's interests therein satisfy the exchange's initial listing requirements;
5. Receipt of all required regulatory, corporate and third party approvals, including Deeprock shareholder approval, exchange approval, and compliance with all applicable regulatory requirements and conditions necessary to complete the transaction;
6. Delivery of standard completion documentation, including, but not limited to, legal opinions, officer certificates, and certificates of good standing or compliance;
7. Other mutual conditions precedent customary for a transaction such as the transaction.

Directors, officers and other insiders

On completion of the transaction, it is anticipated that the board of the resulting issuer will consist of five members, with ACM nominating four members and Deeprock nominating one member. On closing, all of the directors of Deeprock will resign other than Mr. Lee, and Roy Bonnell, Sean O'Neill (as non-executive chairman), Joao Barros, Michael Galego, and Colin Padget will be appointed as directors of the resulting issuer. Mr. Bonnell will be appointed as chief executive officer, Mr. Barros as president and chief operating officer, Mr. Margetson as chief financial officer, and Mr. Lee as corporate secretary. Additional information about its proposed new directors, officers and insiders is provided in the company's circular, which is filed under the company's profile on SEDAR+ as the principal disclosure document in respect of the transaction.

Qualified person

Douglas Blanchflower, BSc (honours), PGeo, is an independent qualified person for the purposes of National Instrument 43-101, and has reviewed and approved the scientific and technical information in this news release.

Further information

More details will follow in the company's information circular and the resulting issuer's listing statement to be prepared in accordance with the listing requirements of the Canadian Securities Exchange policies.

We seek Safe Harbor.