Graphene Manufacturing Group and Cuspis Capital Announce Closing of Qualifying Transaction

Graphene Manufacturing Group Ltd. (formerly Graphene Manufacturing Group Pty Ltd.) (“GMG” or the “Company“) and Cuspis Capital Ltd. (TSXV: CUSP.P) (“Cuspis“) are pleased to announce that they have completed their previously announced qualifying transaction (the “Transaction“) under TSX Venture Exchange (“TSXV“) Policy 2.4 – Capital Pool Companies.

The Transaction was completed by way of statutory plan of arrangement under the Business Corporations Act (Ontario). Pursuant to the Transaction, the Company has acquired 100% of the issued and outstanding shares in the capital of Cuspis (“Cuspis Shares“) in exchange for the issuance of 6,162,072 ordinary shares in the capital of the Company (“Shares“) to the former shareholders of Cuspis. The Company also issued 604,500 stock options (“Options“) of the Company to former holders of stock options of Cuspis, with each Option being exercisable to purchase one Share at a price of C$0.4963 until March 12, 2024. In connection with the Transaction, the Company also issued 291,880 Shares to Tri View Capital Ltd. (“Tri View“) pursuant to an investment advisory agreement between the Company and Tri View.

A total of 31,768,000 GMG Shares and 2,916,704 Options (“Surplus Escrowed Securities“) held by certain principals and other shareholders of the Company will be subject to the TSXV’s Tier 1 Surplus escrow requirements, with 10% of the Surplus Escrowed Securities to be released at the date of the Final Exchange Bulletin (the “Exchange Bulletin“) in respect of the Transaction and listing of the GMG Shares on the TSXV (“Listing“), with 20%, 30%, and 40% of the total Surplus Escrowed Securities to be released, respectively, at the 6^th, 12^th and 18^th month anniversaries of the date of the Exchange Bulletin. A total of 2,015,000 GMG Shares (“CPC Escrowed Securities“) held by the former principals of Cuspis will be subject to the TSXV’s Capital Pool Company escrow requirements, with 25% of the CPC Escrowed Securities to be released at the date of the Exchange Bulletin and 25% of the total CPC Escrowed Securities to be released at each of the 6^th, 12^th and 18^th anniversaries of the date of the Exchange Bulletin.

Upon closing of the Transaction, William Ollerhead, a former director of Cuspis, was appointed as a director of the Company.

The Transaction and Listing is subject to final acceptance of the Transaction by the TSXV, which will occur upon the issuance of the Final Exchange Bulletin (the “Exchange Bulletin“) by the TSXV. Subject to final approval of the TSXV, Cuspis will no longer be a capital pool company, and the Company will be classified as a Tier 1 Industrial Issuer pursuant to TSXV policies, trading under the symbol “GMG”. The Company will issue a news release once the TSXV issues the Exchange Bulletin advising of the expected listing date.

Conversion of Subscription Receipts

As previously disclosed in the news release of Cuspis dated April 7, 2021, on March 24, 2021 the Company completed a non-brokered private placement financing of 3,077,000 subscription receipts (each, a “Subscription Receipt“) at a price of C$0.65 per Subscription Receipt for gross proceeds of C$2,000,050 (the “Offering“).

On April 12, 2021, the Subscription Receipts automatically converted (“Conversion“) into 3,077,000 units of GMG (the “Units“). Each Unit consists of one (1) GMG Share and one-half (1/2) of one ordinary share purchase warrant of GMG (each, a “GMG Warrant“), with each whole GMG Warrant exercisable into one (1) GMG Share at a price of C$1.00 for a period of eighteen (18) months from the date of issuance. GMG intends to use the proceeds of the Offering for general working capital purposes. The Units and all securities issuable thereunder are subject to a four-month hold period under applicable Canadian securities laws expiring on July 25, 2021.

At Conversion, GMG also paid finder’s fees to in the aggregate amount of C$109,755.59 in cash, representing 6% of the proceeds from investors introduced by applicable finders, and issued an aggregate of 161,430 share purchase warrants of GMG (the “Finder Warrants“), representing 6% of the Subscription Receipts subscribed for by investors introduced by applicable finders (collectively, the “Finder’s Fees“). Each Finder Warrant is exercisable for one GMG Share (“Finder Warrant Share“) at an exercise price of C$0.65 for a period of 18 months from the date of issuance. The Finder Warrants and Finder Warrant Shares are subject to a four-month hold period expiring on August 13, 2021.

Name Change and Prospectus

The Company also announces that effective April 2, 2021, the Company’s name changed from “Graphene Manufacturing Group Pty Ltd.” to “Graphene Manufacturing Group Ltd.”

For more information regarding the Transaction, the Offering and the change of the Company’s name, please refer to the final long form non-offering prospectus of the Company dated March 31, 2021 (the “Prospectus“) filed under the Company’s previous name of “Graphene Manufacturing Group Pty Ltd.” and available on the Company’s SEDAR profile at www.sedar.com.

Early Warning Disclosure Pursuant to National Instrument 62-103

Immediately prior to closing of the Transaction, the Company held no Cuspis Shares. Upon closing of the Transaction, the Company acquired 15,290,500 Cuspis Shares, representing 100% of the issued and outstanding Cuspis Shares. As a result of the Transaction, Cuspis intends to apply to cease to be a reporting issuer in the Provinces of Ontario, British Columbia, Alberta and Saskatchewan, and to delist the Cuspis Shares from the TSXV. The Company will continue to conduct its business as described in the Prospectus.

Immediately prior to closing of the Transaction, Craig Nicol, Chief Executive Officer, Corporate Secretary and Managing Director held 13,200,000 Shares and 826,540 Options representing approximately 22.17% of the issued and outstanding Shares on a non-diluted basis and 20.54% of the issued and outstanding Shares on a fully diluted basis. Upon closing of the Transaction, Mr. Nicol’s 13,200,000 Shares and 826,540 Options represent approximately 19.11% of the issued and outstanding Shares on a non-diluted basis and 18.25% of the issued and outstanding Shares on a fully-diluted basis. Mr. Nicol may in the future take such actions in respect of his holdings as ‎he deems appropriate in light of the circumstances then existing, including the ‎purchase of additional shares or other securities of the Company through open market ‎purchases or privately negotiated transactions, or the sale of all or a portion of his ‎holdings in the open market or in privately negotiated transactions to one or more ‎purchasers.‎

The Company’s head office is located at Unit 5, 18 Spine Street, Sumner, QLD Australia, 4074. A copy of the Early Warning Report prepared in connection with the acquisition of the Cuspis Shares by the Company and the GMG Shares held by Craig Nicol can be obtained on the Company’s SEDAR profile or by contacting Christopher Ohlrich at 617 3040-5716.

SOURCE: Graphene Manufacturing Group Ltd. and Cuspis Capital Ltd.

For further information, please contact Christopher Ohlrich, Chief Financial Officer and Executive Director of the Company at chris.ohlrich@graphenemg.com.

Reader Advisory

Certain information set forth in this news release contains forward-looking statements or information (“forward-looking ‎statements“), including details about the Transaction, the Company’s listing on the TSXV and anticipated timing thereof, receipt of all required regulatory and TSXV approvals, the proposed use of proceeds from the Offering, the application of Cuspis to cease to be a reporting issuer and the delisting of the Cuspis Shares on the TSXV. By their nature, forward-looking statements are subject to numerous risks ‎and uncertainties, some of which are beyond the Corporation’s control, including those set out in the long form non-offering prospectus of the Company dated March 31, 2021 available on the Company’s SEDAR profile at www.sedar.com. Although the ‎Corporation believes that the expectations in its forward-looking statements are reasonable, its forward-looking statements have ‎been based on factors and assumptions concerning future events which may prove to be inaccurate. Those factors and ‎assumptions are based upon currently available information. Such statements are subject to known and unknown risks, ‎uncertainties and other factors that could influence actual results or events and cause actual results or events to differ materially ‎from those stated, anticipated or implied in the forward-looking statements. Accordingly, readers are cautioned not to place undue ‎reliance on the forward-looking statements, as no assurance can be provided as to future results, levels of activity or achievements. ‎Risks, uncertainties, material assumptions and other factors that could affect actual results are discussed the final long form non-offering prospectus of the Company dated March 31, 2021 available on the Company’s SEDAR profile at www.sedar.com. Furthermore, the forward-looking statements contained in this document are made as of ‎the date of this document and, except as required by applicable law, the Corporation does not undertake any obligation to publicly ‎update or to revise any of the included forward-looking statements, whether as a result of new information, future events or ‎otherwise. The forward-looking statements contained in this document are expressly qualified by this cautionary statement.‎

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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