Rok signs agreement for going-private transaction

Executive Summary

• Rok Resources Inc. has entered into an arrangement agreement to go private via a statutory plan of arrangement with Blue Alaska Oil Trading LLC (the purchaser).
• Shareholders will receive a total consideration of approximately 27.6 cents per common share, comprising $52 million in cash (23.9 cents per share) and one share in a new private entity, Spinco (deemed value of 3.7 cents per share), which holds Rok's lithium assets.
• The transaction represents a 26% premium to the closing price on Sept. 22, 2025, and an estimated all-in premium of 45% when including the value of the retained lithium interests.
• The deal is expected to close in Q1 2026, subject to shareholder, court, and regulatory approvals, with a special meeting scheduled for November 2025.

Key Details

• Transaction Structure: Statutory plan of arrangement under the Canada Business Corporations Act.
• Total Consideration: Approximately 27.6 cents per common share.
  • Cash Component: 23.9 cents per share, totaling ~$52 million in cash.
  • Spinco Component: One common share in Spinco (102220885 Saskatchewan Ltd.) for each Rok share held, with a deemed value of 3.7 cents per Spinco share.
• Premiums:
  • 26% premium to the closing price of 19 cents/share on Sept. 22, 2025.
  • 39% premium to the 30-day volume weighted average price (VWAP) of 19.8 cents/share.
  • Estimated all-in premium of 45% to the combined closing price of Rok and EMP Metals shares.
• Spinco Assets: Spinco will retain Rok’s lithium assets, specifically 18,925,000 common shares in EMP Metals Corp., representing a 16.47% undiluted equity ownership.
• EMP Metals Details:
  • Spinco shares are subject to escrow: 50% released Sept. 18, 2026; remaining 50% released Sept. 18, 2027.
  • EMP Metals has leased ~200,000 acres of subsurface lithium rights.
  • Previously drilled a lithium brine well measuring 259 mg/L.
• Tax Adjustments: Consideration may be reduced dollar-for-dollar if the transfer of EMP Metals shares creates a taxable event not offset by existing tax attributes (expected to be minimal).
• Closing Conditions:
  • Approval of at least 66-2/3% of votes cast by Rok shareholders.
  • TSX Venture Exchange, court, and regulatory approvals.
  • Expected closing: On or before Q1 2026.
  • Special Shareholder Meeting: Expected in November 2025.
• Option/RSU Vesting: All outstanding and unvested options and restricted share units (RSUs) will automatically vest upon closing due to the change of control.
  • Option holders may exercise vested and unvested options between the shareholder meeting and five business days prior to the effective date.
• Transaction Costs:
  • Rok to pay up to $4 million in fees/costs from working capital.
  • Excess costs deducted from shareholder consideration.
  • $3 million deposit held in trust by Blue Alaska/purchaser.
  • Reciprocal break fee of $3 million if terminated under specific conditions.
• Post-Closing Status: Rok will cease listing on the TSX-V and apply to cease being a reporting issuer, becoming a privately held company.
• Advisers:
  • Financial Adviser: National Bank Financial Inc. (provided fairness opinion).
  • Legal Counsel: McDougall Gauley LLP.
  • Tax Adviser: KPMG LLP.
• Support: Directors and executive officers holding ~17% of shares have entered into voting support agreements.

Notable Quotes

• Bryden Wright, President and CEO: "We are pleased to have reached this agreement with Blue Alaska, which delivers liquidity to Rok shareholders at a premium to the current market price of the company's listed common shares, while providing further exposure to the company's lithium assets through continued ownership of Spinco."