Mustang Energy Corp. Enters Into Arrangement Agreement to Spin Off Ford Lake, Roughrider South and Cigar Lake East Projects

Executive Summary

• Mustang Energy Corp. entered into a statutory plan of arrangement to transfer its Ford Lake, Roughrider South and Cigar East properties to wholly‑owned subsidiary Allied Strategic Resource Corp., followed by a pro‑rated spin‑out of Allied shares to Mustang shareholders.
• The transaction will create two separate reporting issuers; Allied will focus on developing the Ford Lake property while Mustang retains interests in its remaining uranium projects, emphasizing Yellowstone.
• Allied plans an initial financing of approximately $1.25 M to fund exploration and working capital, with potential insider participation and a pending CSE listing.

Key Details

• Arrangement Agreement (Oct 9 2025): Transfer of Ford Lake, Roughrider South, and Cigar East properties to Allied; spin‑out of all Allied shares to Mustang shareholders on a pro‑rated basis.
• Property Overview:
• Ford Lake: 7,431 ha, 2 km off Fox Lake road, 12 km from key highway, near major uranium deposits (Key Lake, Millennium, Gryphon, Phoenix). Unconformity depth 100–400 m.
• Roughrider South & Cigar East: Combined 3,443 ha in the Wollaston‑Mudjatik transition zone, close to all‑season roads and power lines; adjacent to world‑class Cigar Lake and Rabbit Lake mines.
• Share Structure Changes: Existing Mustang common shares become Class A common shares; a new class of voting common shares (“New Mustang Share”) is created. Each Class A share will be exchanged for one New Mustang Share plus a variable number of Allied shares determined at the effective date.
• Allied Financing: Target gross proceeds ≈ $1,250,000 (or amount board deems appropriate) to fund exploration on transferred properties and working capital; insiders may participate.
• Strategic Rationale:
• Unlocks value by allowing market to price the Athabasca Basin assets independently.
• Enables focused development of Ford Lake under Allied.
• Allows Mustang to concentrate on remaining portfolio (Brown Lake, Dutton, Yellowstone, etc.) without operational/financial constraints of the transferred properties.
• Approvals & Timeline:
• Interim court order sought from Supreme Court of British Columbia to call a special shareholders’ meeting (expected Nov 14 2025).
• Arrangement requires ≥ 2/3 shareholder approval at the meeting, final court sanction, and CSE listing approval for Allied.
• Anticipated completion by end‑Q4 2025, subject to closing conditions.
• Future Listings: Allied intends to apply for a Canadian Securities Exchange (“CSE”) listing of its shares following the spin‑out.

Notable Quotes

“The Arrangement is in the best interests of both the Company and its shareholders… By completing the Arrangement, the Properties will be positioned to be valued independently, which is expected to unlock additional value for Mustang’s shareholders.” – Nicholas Luksha, CEO & Director, Mustang Energy Corp.