Highland Critical closes Highland Red distribution

Executive Summary

• Highland Critical Minerals Corp. and Highland Red Lake Gold Corp. have completed the previously announced statutory plan of arrangement, distributing a portion of Highland Critical’s holdings in Highland Red Lake to securityholders.
• The transaction involved the distribution of 15,635,416 Highland Red Lake shares and 15,635,416 warrants to Highland Critical shareholders, while Highland Critical retained 4,885,416 shares (including 2.75 million representing an advisory fee).
• Highland Critical’s ownership stake in Highland Red Lake decreased from 73.47% to 17% following the distribution, triggering an early warning report filing.
• Operational updates were provided for three properties: Highland Red Lake is conducting exploration at its Red Lake claims; Highland Critical is evaluating future exploration at the Church property with a decision expected in Spring 2026; and Highland Critical is finalizing contracts for the next phase of exploration at the Sy property.

Key Details

• Transaction Structure: Completed via a statutory plan of arrangement under Section 288 of the Business Corporations Act (British Columbia), pursuant to an arrangement agreement dated Aug. 19, 2025.
• Distribution Mechanics:
  • Record Date: Aug. 26, 2025.
  • Effective Date: Dec. 8, 2025.
  • Shareholders: Each holder of prearrangement common shares received 0.5 of a Highland Red Lake share and 0.5 of a Highland Red Lake warrant for each share held.
  • RSU Holders: Each holder of outstanding RSUs received an RSU in Highland Red Lake entitling them to acquire 0.5 share and 0.5 warrant per Highland Critical RSU. Unexchanged RSUs may now receive Class A common shares.
  • Warrant Holders: Highland Critical warrants were amended to allow exercise for: (a) one Class A common share for prearrangement shares issuable upon exercise, and (b) 0.5 Highland Red Lake share and 0.5 Highland Red Lake warrant for each prearrangement share issuable upon exercise.
• Share Counts and Retention:
  • Distributed: 15,635,416 Highland Red Lake shares and 15,635,416 Highland Red Lake warrants distributed to securityholders.
  • Retained: 4,885,416 Highland Red Lake shares retained by Highland Critical.
  • Advisory Fee: 2.75 million of the retained shares represent payment of an advisory fee by Highland Red Lake to Highland Critical.
• Share Exchange: Each prearrangement common share was exchanged for one Class A common share, which was then cancelled.
• New Security Identifiers:
  • Class A Common Shares: CUSIP 429935 10 9, ISIN CA 429935 10 9 4.
  • Highland Red Lake Shares: CUSIP 43074E 10 0, ISIN CA 43074E 10 0 7.
  • Highland Red Lake Warrants: CUSIP 43074E 11 8, ISIN CA 43074E 11 8 9.
• Ownership Change (Early Warning Report):
  • Highland Critical’s holding decreased from 20,520,832 shares (73.47% of outstanding) to 4,885,416 shares (17% of outstanding on an undiluted basis).
• Property Updates:
  • Red Lake Claims (Highland Red Lake): Currently executing exploration focused on prospecting, lidar, and magnetic imaging. Findings are under review with geological consultants to determine optimal locations for the next phase. An update on exploration plans is expected in the coming weeks.
  • Church Property (Highland Critical): Evaluating plans to continue exploration. No formal decision on expansion or cessation has been made; a determination is anticipated in Spring 2026 based on assessments with geological consultants.
  • Sy Property (Highland Critical): Preparations underway for the next phase of exploration. Contracts with local staff and contractors are being finalized. Exploration plans will be announced once primary contracts are secured.

Notable Quotes

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