Kelly Ventures signs LOI to acquire VulEnergy as QT

Mr. Paul Larkin reports KELLY VENTURES AND VULENERGY ENTER INTO BINDING LETTER OF INTENT FOR QUALIFYING TRANSACTION Kelly Ventures Ltd. and Belag S.A., to be incorporated in the British Virgin Islands and which will own all of the issued and outstanding shares of VulEnergy, incorporated in Argentina, have entered into a binding letter of intent (LOI) dated Oct. 22, 2025, which outlines the terms and conditions by which Kelly Ventures intends to complete a business combination with VulEnergy to acquire all of the issued and outstanding securities of VulEnergy for shares of the resulting issuer. Following closing of the transaction, VulEnergy is expected to be a wholly owned subsidiary of the issuer and the issuer will change its name to VulEnergy Corp. or such other name as determined by the parties. The exchange ratio and valuation for VulEnergy has not yet been finalized and will be determined in the context of the terms of the concurrent financing. The letter of intent has an indicative split of the resulting issuer of 6 per cent Kelly Ventures and 94 per cent VulEnergy. A finder's fee capped at $60,000 will be payable to Seahawk Capital Corp., the principal of which is Saf Dhillon. The proposed transaction is intended to be the qualifying transaction of Kelly Ventures (as such term is defined in the policies of the TSX Venture Exchange). The transaction is not a non-arm's-length transaction (as such term is defined in the policies of the TSX-V), and no insider of Kelly Ventures has a direct or indirect interest in VulEnergy. It is anticipated that the QT may be subject to shareholder approval, subject to legal review. About VulEnergy VulEnergy has rights to a high-potential geothermal project backed by established industry players in Argentina's world-renowned lithium triangle. The VulEnergy project is located on 25,000-plus hectares of land in Catamarca, Argentina, a lithium production and development area, which includes identified heat sources (41 C surface/220 C deep-level temperatures), which represents a promising location for eco-friendly geothermal exploration and electricity development. Geothermal energy is produced from heat sources generated from the earth's interior. It is a renewable, base load and sustainable energy source for electricity generation, ideally suited to off the grid electricity generation. The VulEnergy project has a unique blend of access to renewable power, with the upside of generating power to support potential direct lithium extraction from the geothermal brines, known to be pregnant with lithium. The VulEnergy project will target geothermal energy and potential geothermal lithium extraction. VulEnergy has an experienced management team, led by: Warren Levy, chief executive officer, who has significant expertise in geothermal operations and has been instrumental in raising over $1.8-billion for Latin American projects; Hernan Montoya, chief financial officer, who has public and private company experience in the Argentinian energy sector; and Fernando Figini, chief operating officer, who has over 30 years of operational experience in the oil and gas sector in Argentina. Paul Larkin, a director of Kelly Ventures, will also be a director of the resulting issuer and has an extensive background in geothermal energy, as a founder, director, audit chair, and chair of merger and acquisition (M&A) committee of U.S. Geothermal Inc. VulEnergy was founded in 2022 by Silvio Duport and Diego Zuckerberg, who are considered control persons under the policies of the TSX Venture Exchange. VulEnergy has purchased the mining concessions totalling roughly 25,000 hectares, providing the company the rights to complete both geothermal electricity generation and potential lithium extraction. VulEnergy has completed preliminary temperature mapping, surface sampling and extensive operational preparation at the site in the province of Catamarca, Argentina. Definitive agreement and concurrent financings The transaction is subject to the negotiation and entering into of a definitive agreement between the issuer and VulEnergy, incorporating the terms described in the letter of intent, and such other terms and conditions as are customary for transactions of a similar nature, including summary financial information for VulEnergy. This information will be included in a subsequent news release as disclosed below. In connection with the transaction, VulEnergy has appointed Research Capital Corp. as a capital markets adviser for a $6-million to $8-million concurrent private placement financing of subscription receipts of VulEnergy. The price and terms of the securities of the VulEnergy financing are yet to be determined. The final ratio of shares and valuation will be subject to the terms of the third party financing parameters and will be recorded in the subsequent news release as disclosed below. Upon entering into the definitive agreement, a comprehensive additional news release disclosing further details of the transaction, including details of the VulEnergy financing postvaluation, the consideration shares contemplated, and the proposed management team and board of the resulting issuer, the company may engage a sponsor in connection with the transaction. If a sponsor is not engaged, a waiver of the sponsorship requirement will be requested from the TSX-V and other material information respecting the transaction will be issued. Trading halt In accordance with the policies of the TSX-V listings Policy 2.4, trading in the shares of the company will remain halted pending receipt and review of acceptable documentation regarding the qualifying transaction. We seek Safe Harbor.