Shellron Capital Ltd — M&A Activity 2025

Apr 18, 2025

Form 51-102F3
Material Change Report

Item 1
Name and Address of Company
Shellron Capital Ltd. (the "Company")
Unit 125A-1030 Denman Street, Box 405
Vancouver, B.C. V6G 2M6

Item 2
Date of Material Change
April 11, 2025

Item 3
News Release
A news release was disseminated on April 17, 2025 through the facilities of Newswire.

Item 4
Summary of Material Change
The Company entered into a letter agreement dated April 11, 2025 (the "Agreement") with SPX Management Ltd. ("SPX") in respect of an arm's length reverse takeover transaction (the "Proposed Transaction") intended to constitute the Company's qualifying transaction as such term is defined in the policies of the TSX Venture Exchange (the "Exchange")

Item 5
Full Description of Material Change
On April 11, 2025 the Company entered into the Agreement with SPX in respect of the Proposed Transaction.

The completion of the Proposed Transaction is subject to the satisfaction of certain conditions, including but not limited to: (i) the parties entering into a definitive agreement with respect to the Proposed Transaction (such agreement to include representations, warranties, conditions and covenants typical for a transaction of this nature), (ii) the completion of satisfactory due diligence investigations, (iii) the proposed board of directors and management of the Resulting Issuer being acceptable to the TSX-V; (iv) the receipt of all requisite regulatory, stock exchange, or governmental authorizations and consents, including the TSX-V; and (v) certain other conditions as may be agreed between the parties.

Pursuant to the Transaction, Shellron will issue an aggregate of ten (10) common shares in the capital of Shellron ("Shellron Shares") for each common share in the capital of SPX ("SPX Shares") held, each at a deemed value of $0.20 per Shellron Share (the "Exchange Ratio"), including any SPX Shares issued pursuant to the Concurrent Financing (as defined below).

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The existing shareholders of SPX are expected to own a majority of the outstanding Shellron Shares after completion of the Proposed Transaction and Shellron will be renamed to such name as mutually agreed to by Shellron and SPX. The final structure of the Proposed Transaction is subject to the receipt of tax, corporate and securities law advice by both Shellron and SPX.

The Proposed Transaction is not a Non-Arm's Length Qualifying Transaction (as such term is defined in TSXV Policy 2.4) and it is not currently contemplated that approval by Shellron's shareholders will be required or sought for the Proposed Transaction or that a shareholders' meeting will be required for the Proposed Transaction. No advances to be made by the Shellron are contemplated and no finder's fees are payable in connection with the Proposed Transaction. Upon the completion of the Proposed Transaction, it is expected that SPX will become a wholly-owned subsidiary of the Resulting Issuer.

In connection with the Proposed Transaction a concurrent commercially reasonable efforts brokered private placement to raise between $5,500,000 and $10,000,000 in aggregate gross proceeds (the "Concurrent Financing") will be completed. The Concurrent Financing will be led by Hampton Securities Limited. (the "Agent") as sole lead agent.

The Concurrent Financing will consist of a minimum of 2,500,000 subscription receipts (each a "Subscription Receipt") or SPX Shares, and any combination thereof, at a price of $0.20 per Subscription Receipt or $2.00 per SPX Share, as the case may be.

In addition, the parties have granted the Agent an option to acquire up to an additional number of Subscription Receipts or SPX Shares for gross proceeds of up to 15% of the gross proceeds of the Concurrent Financing at any time up to two (2) days prior to the final closing of the Concurrent Financing.

Each Subscription Receipt will entitle the holder, without payment of any additional consideration and upon satisfaction of Escrow Release Conditions (defined below), to receive one unit of the Resulting Issuer (a "Unit"). Each Unit is comprised of one Shellron Share (a "Resulting Issuer Share") and one-half common share purchase warrant (each whole warrant, a "Resulting Issuer Warrant"). Each Resulting Issuer Warrant will the holder to acquire a Resulting Issuer Share at an exercise price of $0.30 per Resulting Issuer Share for 36 months after the date the Escrow Release Conditions are satisfied. The expiry date of the Resulting Issuer Warrants may be accelerated by the Resulting Issuer at any time following the four (4) month anniversary of the date the Escrow Release Conditions are satisfied and prior to the expiry date of the Resulting Issuer Warrants if the volume weighted average price of the Resulting Issuer Shares on the

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TSXV is greater than $0.60 for any 30 consecutive trading days (the "Acceleration Event"), at which time the Resulting Issuer may, within five (5) business days of the Acceleration Event, accelerate the expiry date of the Resulting Issuer Warrants by issuing a press release announcing the reduced warrant term whereupon the Resulting Issuer Warrants will expire on the 30th calendar day after the date of such press release.

The net proceeds of the Concurrent Financing will be used for the development of the Resulting Issuer's business, working capital requirements and general corporate purposes.

The aggregate gross proceeds of the Subscription Receipts, less 50% of the Cash Commission (as defined below) attributable to the Subscription Receipts, the reasonable costs and expenses of any agent engaged and $100,000 to be utilized by Shellron for its expenses, shall be deposited into escrow on the closing of the offering of Subscription Receipts (the "Financing Closing") and shall be released upon satisfaction of certain conditions (the "Escrow Release Conditions") including the completion, satisfaction or waiver of all conditions precedent necessary for the completion of the Proposed Transaction. If the Escrow Release Conditions are not satisfied prior to 120 days after the Financing Closing, the escrow agent will return to the holders of Subscription Receipts an amount equal to the aggregate purchase price for the Subscription Receipts held by them and the Subscription Receipts will be cancelled and be of no further force or effect.

In connection with the Concurrent Financing, the Agent will receive a due diligence fee of $50,000 from SPX plus a cash fee equal to 6% of the gross proceeds raised from the sale of Subscription Receipts and 6% of the gross proceeds raised from the sale of SPX Shares, subject to a reduction to 2% for certain purchasers on a "president's list" (the "Cash Commission"). In addition, the Resulting Issuer will issue non-transferable compensation warrants (the "Compensation Warrants") equal to 6% (2% president's list) of the total number of Subscription Receipts sold under the Concurrent Financing. Each Compensation Warrant will entitle the holder thereof to purchase one Resulting Issuer Share at an exercise price of $0.20 per Resulting Issuer Share for a period of 36 months after the date the Escrow Release Conditions are satisfied. No Compensation Warrants are issuable in respect of the sale of SPX Shares in the Concurrent Financing. An additional cash fee of $50,000 will be due on the date the Escrow Release Conditions are satisfied.

Any SPX Shares issuable in the Concurrent Financing will be acquired by Shellron pursuant to the Proposed Transaction in accordance with the Exchange Ratio.

The parties have agreed that upon the execution of the definitive agreement for the Proposed Transaction and the successful completion of

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a minimum of $250,000 of the Concurrent Financing, SPX shall provide a loan to Shellron in the amount of $50,000 (the “Bridge Loan”). The Bridge Loan will be unsecured, bear interest at a rate of 4% per annum, and have a term of 12 months. The Bridge Loan will be forgiven by SPX in certain circumstances in the event of a termination of the Proposed Transaction.

If the Bridge Loan has not been advanced by May 15, 2025, SPX will use all commercially reasonable efforts to cause the subscription for a private placement of 250,000 Shellron Shares at a price of $0.20 per share (the “Bridge Financing”) to provide funds to Shellron to cover its expenses in relation to the Proposed Transaction as well as general and administrative expenses.

SPX has agreed to be responsible for the payment or reimbursement of all Shellron’s expenses relating to the Proposed Transaction, including legal fees, auditor fees, financial advisory fees, fees payable to TSXV and reasonable disbursements of Shellron and its advisors, provided however that in the event the Bridge Financing is completed, such expenses will only be payable by SPX in the event they exceed the amount of the Bridge Financing.

Item 6
Reliance on subsection 7.1(2) or (3) of National Instrument 51-102

This Report is not being filed on a confidential basis in reliance on subsection 7.1(2) or (3) of National Instrument 51-102.

Item 7
Omitted Information

No information has been omitted on the basis that it is confidential information.

Item 8
Executive Officer

Daniela Freitas is knowledgeable about the material change and the Report and may be contacted (604) 418.6560.

Item 9
Date of Report

April 18, 2025