Critical Metals to acquire European Lithium

Critical Metals Corp. [Nasdaq: CRML], a leading critical mineral mining company, reported the signing of a letter of intent whereby Critical Metals has proposed to acquire all of the outstanding shares of European Lithium Ltd. [ASX: EUR]. Under the proposed transaction, European Lithium shareholders will receive 0.035 shares of Critical Metals for each European Lithium share held (the exchange ratio). Based on the exchange ratio and considering the unaffected closing price of Critical Metals and the US Dollar to Australian Dollar exchange rate on April 22, 2026 (the measurement date), the total aggregate consideration payable to European Lithium equity holders is approximately US$835 million.

The proposed transaction is subject to the signing of a definitive agreement.

The proposed transaction is a logical combination that has a compelling strategic rationale and is expected to create value for Critical Metals shareholders.

Minimize Critical Metals dilution and increase Critical Metals Public Float: European Lithium owns 45,536,338 shares of Critical Metals (the cross-holding shares), representing approximately 34% of Critical Metals outstanding shares as of the measurement date. As of the measurement date, the cross-holding shares had a market value of US$540 million without considering any potential control block value premium.

Upon completion of the proposed transaction, Critical Metals intends to cancel the cross-holding shares which will substantially reduce the associated Critical Metals shareholder dilution resulting from the proposed transaction yet materially increase Critical Metals’ public float which is expected to augment Critical Metals’ already strong trading liquidity profile.

Consolidation of Tanbreez Ownership: European Lithium owns 7.5% of the Tanbreez Rare Earth Project in Greenland and following completion of the proposed transaction, Critical Metals is positioned to consolidate 100% of Tanbreez, which will simplify the ownership, decision making and financing strategy for Tanbreez as it is advanced towards a development decision.

Fortification of Critical Metals’ balance sheet: European Lithium has a cash balance of approximately AUD$306 million (approximately US$219 million) as of March 31, 2026, and Critical Metals, which currently has a standalone cash balance of approximately US$124 million, will have a robust balance sheet to accelerate the development of Tanbreez into a strong rare earth market that requires new sources of heavy rare earth elements from Western allied nations. In addition, excluding the Cross-holding Shares, European Lithium currently holds marketable securities with a market value of approximately US$11 million.

The proposed transaction will be implemented by way of two interdependent schemes of arrangement in relation to European Lithium’s shares and listed options respectively.

European Lithium’s outstanding shares will be exchanged for Critical Metals shares at the Exchange Ratio.

European Lithium’s outstanding listed options (EUR options) will be transferred to Critical Metals in exchange for a number of Critical Metals ordinary shares equal to the exchange ratio times the cashless exercise shares. “Cashless Exercise Shares” means a number equal to the excess of per share value over the exercise price per EUR Option divided by the per share value. “Per Share Value” refers to an amount equal to the Critical Metals’ share pricing based on a 20-day VWAP prior to the transaction closing date times the exchange ratio.

European Lithium’s zero-dollar exercise price unlisted options (ZEPOs) will be treated as follows: The ZEPO tranches (totaling 90,000,000 ZEPOs) consisting of 45,000,000 ZEPOs vesting upon European Lithium’s VWAP exceeding A$0.50 for 20 consecutive trading days, and 45,000,000 ZEPOs vesting upon the European Lithium’s VWAP exceeding A$0.60 for 20 consecutive trading days will be cancelled in consideration for newly issued Critical Metals ordinary shares, with the number to be issued calculated using the Exchange Ratio.

The remaining ZEPO tranches (totaling 180,000,000 ZEPOs) consisting of 45,000,000 ZEPOs vesting upon European Lithium’s VWAP exceeding A$0.70 for 20 consecutive trading days, 45,000,000 ZEPOs vesting upon the European Lithium’s VWAP exceeding A$0.80 for 20 consecutive trading days, 45,000,000 ZEPOs vesting upon European Lithium’s VWAP exceeding A$0.90 for 20 consecutive trading days, and 45,000,000 ZEPOs vesting upon European Lithium’s VWAP exceeding A$1.00 for 20 consecutive trading days will be exchanged for newly issued economically equivalent securities issued by Critical Metals (with the quantum of such securities calculated by multiplying the number of ZEPOs by the Exchange Ratio), with the Critical Metals securities having the same vesting conditions (subject only to adjustments in the case of share price targets, calculated by multiplying the various share price targets by the inverse of the Exchange Ratio) and the same expiration dates as the existing ZEPOs.

Completion of the proposed transaction is conditional upon a number of items, including, without limitation, the negotiation and entering into of a binding scheme implementation deed, approval of the shareholders of European Lithium, European Lithium having a net cash and liquid assets balance of not less than AUD$330,000,000, the holders of unlisted options and ZEPOs entering into cancellation deeds to give effect to the treatment of those securities as set out above, no material adverse change in European Lithium and Critical Metals business and assets and of any prescribed occurrences or regulated events, receipt of all necessary regulatory approvals, consents, waivers or modifications and court approvals and completion of satisfactory due diligence by both parties.

European Lithium has agreed to an exclusivity period during which it will not solicit or initiate enquiries or, subject to certain exceptions, participate in any discussions or negotiations relating to any other acquisition proposals, or issue any debt, equity, or equity-like securities.

The proposed transaction is expected to be completed in the second half of 2026. If a definitive agreement is reached, a scheme meeting of the shareholders of European Lithium is expected to be held in the third quarter of 2026 to approve the proposed transaction.

Critical Metals has engaged Cantor Fitzgerald & Co. as its financial advisor, Cleary Gottlieb Steen & Hamilton LLP as its U.S. legal advisor and Nova Legal as its Australian legal advisor in respect of the Proposed Transaction. European Lithium has engaged Poynton Stavrianou as its financial advisor and Steinepreis Paganin as its legal advisor in respect of the Proposed Transaction.

Critical Metals is focused on critical metals and minerals, and producing strategic products. Its flagship project, Tanbreez, is one of the world’s largest, rare-earth deposits located in southern Greenland. The deposit is expected to have access to key transportation outlets as the area features year-round direct shipping access via deep water fjords that lead directly to the North Atlantic Ocean.

Another key asset is the Wolfsberg Lithium Project located in Carinthia, 270 km south of Vienna, Austria. The Wolfsberg Lithium Project is the first fully permitted mine in Europe and is strategically located with access to established road and rail infrastructure and is expected to be the next major producer of key lithium products to support the European market.