Kelly Ventures Ltd. (TSXV: KKL.P), a capital pool company, and VUL Energy Ltd. have entered into a definitive merger agreement dated November 2, 2026, for a reverse takeover transaction intended to serve as Kelly Ventures' Qualifying Transaction under TSX Venture Exchange policy. Simultaneously, VUL Energy announced a brokered private placement of subscription receipts targeting gross proceeds of up to C$10.0 million, with C$8.6 million already committed through strategic lead orders. The combined transaction is designed to create an Argentina-focused geothermal energy platform with embedded lithium optionality, targeting a 60 MW baseload power project in Catamarca, Argentina.

Key Points

  • Kelly Ventures Ltd. (TSXV: KKL.P) and VUL Energy Ltd. have signed a definitive merger agreement for a reverse takeover Qualifying Transaction
  • VUL Energy is launching a brokered subscription receipt offering at C$1.40 per receipt for gross proceeds of up to C$10.0 million, led by Research Capital Corporation
  • C$8.6 million in strategic lead orders already secured via simple agreements for future equity; offering expected to close around the week of November 30, 2026
  • Investors will be watching for regulatory and shareholder approvals and the satisfaction of escrow release conditions within 90 days of closing

Reverse Takeover Structure and Resulting Issuer Details

Under the Definitive Agreement, VUL Energy will complete the reverse takeover of Kelly Ventures through a three-cornered amalgamation involving a wholly-owned Ontario subsidiary. Upon completion, Kelly Ventures will change its name to "VUL Energy Ltd." and the resulting issuer's shares are expected to trade on the TSX Venture Exchange under the ticker symbol "VEN." The transaction supersedes a binding letter of intent dated October 22, 2025. Escrow release conditions must be satisfied within 90 days of the offering's closing date, and up to C$3.0 million of escrowed funds may be released early to advance site access, camp installation, geotechnical studies, and working capital.

Subscription Receipt Financing Terms and Agent Compensation

Each subscription receipt converts, upon satisfaction of escrow release conditions, into one unit comprising one VUL Energy common share and one warrant exercisable at C$1.82 for 36 months. The agent, Research Capital Corporation, holds an overallotment option covering up to 15% of offering proceeds, exercisable until 48 hours before closing. The agent will receive a cash commission of 8.0% of gross proceeds and broker warrants equal to 8.0% of subscription receipts sold, each exercisable at C$1.40 per unit for 36 months. A warrant acceleration clause applies if the volume-weighted average trading price exceeds C$2.73 for 10 consecutive trading days.

VUL Energy's Catamarca Geothermal Project and Lithium Upside

VUL Energy holds approximately 25,000 hectares of mining concessions near the Lastarria volcano in Catamarca, Argentina, with an option to expand to 40,000 hectares. An independent evaluation by Sproule ERCE estimates an unrisked project NPV10 of C$194.9 million (P50) for the Catamarca geothermal project. The 60 MW development targets annual power generation of approximately 515,000 MWh, with revenue potential ranging from approximately US$129 million to US$155 million per year at targeted pricing. VUL Energy has also signed a non-binding letter of intent with a neighbouring lithium company for a 40–60 MW, 35-year power offtake agreement, subject to a final investment decision.