Battery Road Capital Corp. Enters into Agreement to Acquire Rare Earth Mining Company in Namibia

Halifax, Nova Scotia--(Newsfile Corp. - October 14, 2020) - Battery Road Capital Corp., (TSXV: BTRY.P) ("Battery Road"), a capital pool company listed on the TSX Venture Exchange (the "TSXV"), is pleased to announce that it has entered into a definitive share exchange agreement dated as of October 10, 2020 and delivered today (the "Definitive Agreement") with E-Tech Kalapuse Mining (Pty) Ltd. ("E-Tech Namibia") and the holders of all of the outstanding shares of E-Tech Namibia (the "E-Tech Namibia Shares"), to provide for the completion of a business combination with Battery Road (the "Transaction"). The combined entity (the "Resulting Issuer") will continue the business of E-Tech Namibia and initially will be engaged in the exploration and development of prospective mineral properties located in Namibia, with a focus on rare earth exploration and development. See "About E-Tech Namibia" below.

The Transaction is intended to constitute the Qualifying Transaction of Battery Road, as such term is defined in Policy 2.4 of the TSXV, and will result in a reverse takeover of Battery Road.

About E-Tech Namibia

E-Tech Namibia is a private company formed under the laws of Namibia that holds an exclusive prospecting licence in the Erongo Region in central west Namibia, which mineral rights include the Eureka Nd-Pr-REE Project. The Eureka Nd-Pr-REE Project hosts the Eureka deposit which is made up of coarse grained monazite-bearing carbonatite dykes intruding (or including) quartzo- feldspathic rocks of the Etusis Formation. E-Tech Namibia has been undertaking geological and mineralogical studies, delineation work, and metallurgical testwork for three years on the Eureka deposit, which remains open laterally and to depth. The deposit has been targeted for the high-grade mono-mineralic nature of its REE (rare earth elements) deportment, with a bias to light REEs and the magnet REE metals neodymium (Nd) and praseodymium (Pr), which are essential components to electric vehicle (EV) motors and wind turbine generators. Logistically advantaged, the deposit is situated adjacent to the arterial B2 tarmac road leading to the container port of Walvis Bay.

The vendors of the E-Tech Namibia Shares are: E-Tech Metals Ltd., a company incorporated under the laws of England and Wales (controlled by Edward Rolstone Loye of Bristol, United Kingdom and Sean Ashley Lapham of Wiltshire, United Kingdom), Kalapuse General Dealer (Pty) Ltd., a company incorporated under the laws of the Republic of Namibia (controlled by Ambrosius Hinanentu Iipinge of Namibia) and Hebron Prospecting (Pty) Ltd., a company incorporated under the laws of Republic of Namibia (controlled by Timothy John Smalley of Windhoek, Namibia) (collectively, the "Vendors").

As at March 31, 2020 (audited, as provided by E-Tech Namibia), E-Tech Namibia had assets of N$276,009 (CAD$21,931) and liabilities of N$2,065,925 (CAD$164,158). For the year ended March 31, 2020 (audited, as provided by E-Tech Namibia), E-Tech Namibia had no revenue and a net loss for the year of N$838,322 (CAD$66,613).

A National Instrument 43-101 - Standards of Disclosure for Mineral Projects compliant technical report and recommended work program is currently being prepared in respect of E-Tech Namibia's mining interests, and details of that technical report and further information regarding E-Tech Namibia's mineral rights will be disclosed in a subsequent news release. Financial information with respect to E-Tech Namibia will also be disclosed in a subsequent news release.

The Qualifying Transaction

Terms of the Transaction

Pursuant to the terms of the Definitive Agreement, Battery Road proposes to acquire each of the 200 issued and outstanding E-Tech Namibia Shares pursuant to the terms of the Definitive Agreement, in exchange for 55,555.6 common shares of the Resulting Issuer (the "Exchange Ratio"). Existing shareholders of E-Tech Namibia Shares are expected to receive 11,111,111 common shares of the Resulting Issuer at a deemed value of $0.216 per share or $2,400,000 in aggregate at closing of the Transaction. Pursuant to the Transaction, the holders of the E-Tech Namibia Shares will become shareholders of the Resulting Issuer.

Conditions of Closing

Completion of the Transaction is subject to a number of conditions, including but not limited to:

1. the parties receiving all requisite regulatory approval, including the approval of the TSXV, and any third party approvals and authorizations;
2. each of the parties required by the TSXV entering into an escrow agreement upon the terms and conditions imposed pursuant to the policies of the TSXV;
3. completion of the Concurrent Private Placement (as defined herein) through Numus Capital Corp. ("Numus Capital");
4. the Resulting Issuer meeting the applicable Initial Listing Requirements of the TSXV as a Mining Issuer (pursuant to Policy 2.1 - Initial Listing Requirements of the TSXV), including, without limitation, the public float requirements;
5. certain amendments to the Exclusive Prospecting Licence 6762 covering the Eureka Project (granted by Ministry of Mines and Energy) relating to local ownership and management; and
6. completion of confirmatory due diligence by Battery Road.

Battery Road expects that upon completion of the Transaction, the Resulting Issuer will be an exploration stage company with no producing properties and, consequently, no current operating income, cash flow or revenues. There is no assurance that a commercially viable mineral deposit exists on the mineral interests held by E-Tech Namibia.

Arm's Length Transaction

E-Tech Namibia and the Vendors are at arm's length to Battery Road. The proposed Transaction is an arm's length transaction in accordance with the policies of the TSXV.

About the Resulting Issuer

Board of Directors and Management

Pursuant to the terms of the Definitive Agreement, the board of directors of the Resulting Issuer upon completion of the Transaction shall consist of five directors, with three nominated by management of Battery Road and two nominated by the Vendors until changed in accordance with corporate legislation. All directors must be mutually approved by both Battery Road and the Vendors and acceptable to the TSXV. In addition, the Chief Executive Officer, the Chief Financial Officer, and lead exploration officer of Battery Road and E-Tech Namibia upon completion of the Transaction shall be as mutually agreed among management of Battery Road and the Vendors.

Further information with respect to the identity of each of the proposed directors and officers of the Resulting Issuer will be provided separately, once confirmed.

Other Insiders of the Resulting Issuer

It is expected that E-Tech Metals Ltd. will hold approximately 26% of the outstanding common shares of the Resulting Issuer and will become a new insider of the Resulting Issuer. Further information with respect new insiders will be provided separately, once confirmed.

Concurrent Private Placement

Pursuant to the terms of the Definitive Agreement, E-Tech Namibia intends to complete private placement(s) of its securities for aggregate gross proceeds of up to $2,000,000 prior to completion of the Transaction on market terms as approved by Battery Road and E-Tech (the "Concurrent Private Placement"). It is intended that any E-Tech Namibia Shares issued pursuant to the Concurrent Private Placement will be exchanged for shares of Battery Road based on the Exchange Ratio.

E-Tech Namibia intends to enter into an agreement with Numus Capital on such terms as approved by Battery Road under which Numus Capital will raise up to $2,000,000 on market terms for E-Tech Namibia as part, or all, of the Concurrent Private Placement. Jim Megann, a director of Battery Road, is an officer, director and non-controlling shareholder of Numus Capital. Numus Capital is a subsidiary of Numus Financial. Further information with respect to the Private Placement will be provided separately, once confirmed.

Loans Provided by Numus Financial Inc. ("Numus Financial")

Pursuant to the terms of the Definitive Agreement, Numus Financial will advance funds in the aggregate amount of up to $500,000 to E-Tech Namibia or E-Tech UK on terms as approved by Battery Road and E-Tech Namibia (the "Numus Loans"). The parties will take such steps as are necessary or desirable such that the Numus Loans will immediately prior to the completion of the Transaction be directly or indirectly settled in exchange for E-Tech Namibia Shares at a value per share equal to the value used to calculate the Exchange Ratio. Any E-Tech Namibia Shares issued pursuant such debt settlement will be exchanged for shares of Battery Road based on the Exchange Ratio. Jim Megann, a director of Battery Road, is an officer, director and non-controlling shareholder of Numus Financial. Shareholders of Numus Financial directly or indirectly own or control 42.4% of the outstanding shares of Battery Road and are expected to directly or indirectly own or control up to 25.6% of the Resulting Issuer. Further information with respect to the any loans to E-Tech Namibia will be provided separately, once confirmed. It is not expected that Battery Road will advance any loans.

Filing Statement

In connection with the Transaction and pursuant to the requirements of the TSXV, Battery Road will file a filing statement or a management information circular on its issuer profile on SEDAR (www.sedar.com), which will contain details regarding the Transaction, E-Tech Namibia, the Eureka Project, and the Resulting Issuer.

Sponsorship

Sponsorship of the Transaction is required by the TSXV unless an exemption or waiver from sponsorship requirement is available. Battery Road is currently reviewing the requirements for and may apply for an exemption from the sponsorship requirements pursuant to the policies of the TSXV. Battery Road intends to include any additional information regarding sponsorship in a subsequent news release.

Trading Halt

Trading in the common shares of Battery Road are presently suspended and will remain so until the Transaction is completed and approved by the TSXV.

Further Information

Battery Road will issue additional news releases related to the Transaction, the Concurrent Private Placement and other material information as it becomes available

About Battery Road Capital Corp.

Battery Road is a Capital Pool Company listed on the TSX Venture Exchange. Its principal business is the identification and evaluation of assets or businesses with a view to completing a qualifying transaction. Battery Road has not commenced commercial operations and has no assets other than cash.

For further information please contact:

Jim Megann, Director
Battery Road Capital Corp.
902-442-7192

Completion of the Transaction is subject to a number of conditions, including but not limited to, TSXV acceptance and if applicable pursuant to TSXV Requirements, majority of the minority shareholder approval. Where applicable, the transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the transaction will be completed as proposed or at all. Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the Transaction, any information released or received with respect to the Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative The TSXV has in no way passed upon the merits of the proposed Transaction and has neither approved nor disapproved the contents of this news release. Neither the TSXV nor its Regulation Service Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.

Forward-Looking Statements

This press release contains forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Battery Road to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.

Examples of such statements include the intention to complete the Qualifying Transaction. Actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained in this press release. Such forward-looking statements are based on a number of assumptions which may prove to be incorrect, including, but not limited to: satisfying conditions under the Amalgamation Agreement; satisfying the requirements of the TSXV with respect to the acquisition and the qualifying transaction; consumer interest in Battery Road's services and products; competition; and anticipated and unanticipated costs. While Battery Road anticipates that subsequent events and developments may cause its views to change, Battery Road specifically disclaims any obligation to update these forward-looking statements. These forward-looking statements should not be relied upon as representing Battery Road's views as of any date subsequent to the date of this press release. Although Battery Road has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. The factors identified above are not intended to represent a complete list of the factors that could affect Battery Road. Additional factors are noted under "Risk Factors" in Battery Road's initial public offering prospectus dated August 10, 2018, a copy of which may be obtained on the SEDAR website at www.sedar.com.

Completion of the Transaction is subject to a number of conditions, including but not limited to, TSXV acceptance and if applicable, disinterested shareholder approval. Where applicable, the Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the transaction, any information released or received with respect to the transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a Capital Pool Company should be considered highly speculative.

The TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/65911