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Cuspis Capital Ltd. & GMG Announce Signing of Acquisition Agreement for Qualifying Transaction

Cuspis Capital Ltd. (TSXV: CUSP) ("Cuspis" or the "Corporation"), a capital pool company as defined under TSX Venture Exchange ("TSXV" or the "Exchange") Policy 2.4 - Capital Pool Companies ("Policy 2.4"), is pleased to announce, further to its press releases of August 19, August 31 and November 4, 2020, that it has entered into a definitive agreement (the "Definitive Agreement") with Graphene Manufacturing Group Pty Ltd. ("GMG"), a private company incorporated under the laws of Australia, whereby the parties will complete a plan of arrangement (the "Plan of Arrangement") pursuant to which Cuspis will become a wholly owned subsidiary of GMG (the "Transaction"). Cuspis intends that the Transaction will constitute its Qualifying Transaction, as such term is defined in the policies of the Exchange. Pursuant to the Plan of Arrangement, shareholders of Cuspis will exchange their Cuspis securities for securities of GMG (resulting in Cuspis becoming a wholly owned subsidiary of GMG), GMG will file a non-offering prospectus with the Ontario Securities Commission, the shares of GMG will be listed on the Exchange as a Tier 2 Industrial Issuer, and the shares of Cuspis would then be delisted from the Exchange.

Cuspis completed its initial public offering in March, 2019. The common shares of Cuspis are listed for trading on the TSXV under the stock symbol "CUSP". Cuspis has not commenced commercial operations and has no assets other than cash. Cuspis was incorporated under the laws of the Province of Ontario.

GMG is based in Brisbane, Australia and was formed on August 10, 2016. GMG produces high quality graphene used in a number of planet-friendly/clean-tech applications, including paints, lubricants and coolants that improve energy efficiency and reduce costs, and in next generation battery technology. GMG's proprietary production process separates natural gas (methane) into its component elements: nano carbon (called graphene) and hydrogen. This process produces high quality, low cost, scaleable, 'tuneable' and contaminant-free graphene.

As a condition to the closing of the Transaction, GMG will effect a share split (the "Share Split") on the basis of twenty two (22) post-split GMG Shares (the "Post Split GMG Shares") for every one (1) pre-split GMG Share. Pursuant to the Plan of Arrangement, 0.403 Post-Split GMG Shares will then be issued in exchange for each one (1) outstanding common share of Cuspis (the "Exchange Ratio"). The outstanding convertible securities of Cuspis will be exchanged for similar securities of GMG based on the Exchange Ratio. Under the Plan of Arrangement, GMG will issue 6,045,000 Post-Split GMG Shares to Cuspis shareholders, out of a total number of Post-Split GMG Shares of 65,595,766, representing 9.216% of the total issued and outstanding shares of GMG upon completion of the Transaction. Pursuant to its advisory agreement with Caerus Management Ltd. ("Caerus"), GMG may issue up to a maximum of 305,954 additional Post-Split GMG Shares to Caerus for services thereunder (the "Caerus Shares"). If the maximum number of Caerus Shares is issued, the total number of Post-Split GMG Shares outstanding would be 65,901,720, with those issued to Cuspis shareholders representing 9.17%.

Will Ollerhead, CEO of Cuspis, stated, "We are very pleased to have reached this important interim milestone on our path to bringing Graphene Manufacturing Group public and completing our transaction with them. I'd also like to personally congratulate GMG's Craig Nicol for his appointment to the role of Chair of the Board of Directors of the Australian Graphene Industry Association."

In accordance with the policies of the TSXV, the common shares of Cuspis are currently halted from trading and will remain so until such time as the TSXV determines, which, depending on the policies of the TSXV, may not occur until completion of the Transaction.

Conditions to the Transaction

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

  • the performance of all covenants and the truthfulness of representations and warranties made pursuant to the Definitive Agreement;

  • no material adverse effect having occurred to either party;

  • shareholder approval from each of GMG and Cuspis;

  • receipt of all requisite regulatory approvals, including from each of the Exchange and the Ontario Securities Commission;

  • Cuspis shall have a minimum cash balance net of any liabilities of $2,000,000;

  • completion of the Share Split; and

  • a maximum of 5% of the outstanding Cuspis shares having exercised dissent rights.

A prior condition, the closing of the financing (for gross proceeds of AUS $1,726,025), has been satisfied, as disclosed in the Corporation's press release of November 4, 2020. However, there can be no assurance that the Transaction will be completed as proposed or at all.

All information contained in this press release with respect to GMG and Cuspis (but excluding the terms of the Transaction) was supplied by the parties respectively, for inclusion herein, without independent review by the other party, and each party and its directors and officers have relied on the other party for any information concerning the other party.

Investors are cautioned that, except as disclosed in the Disclosure Document 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 Transaction and has neither approved nor disapproved the contents of this press release.

For further information:

William Ollerhead Cuspis Capital Ltd.

Will@CuspisCapital.com Tel. (416) 214-4810

Forward-Looking Information

This press release contains "forward-looking information" and "forward-looking statements" (collectively, "forward-looking statements") within the meaning of applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this press release. Any statement that involves discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as "expects", or "does not expect", "is expected" "anticipates" or "does not anticipate", "plans", "budget", "scheduled", "forecasts". "estimates", "believes" or intends" or variations of such words and phrases or stating that certain actions, events or results "may" or "could, "would", "might" or "will" be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements. In this press release, forward-looking statements relate, among other things, to: the Transaction and certain terms and conditions thereof; the business of GMG, the GMG Share Split; the Exchange Ratio; shareholder, director and regulatory approvals; and future press releases and disclosure. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: general business, economic, competitive, political and social uncertainties; and the delay or failure to receive shareholder, director or regulatory approvals. There can be no assurance that such 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 the forward-looking statements and information contained in this press release. Except as required by law, Cuspis assumes no obligation to update the forward-looking statements of beliefs, opinions, projections, or other factors, should they change, except as required by law.

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

This press release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States unless registered under the U.S. Securities Act and applicable state securities laws, unless an exemption from such registration is available.

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