Canex comments on Gold Basin directors circular

Executive Summary

• Canex Metals Inc. publicly refutes a directors' circular from Gold Basin Resources Corp., which recommended shareholders reject Canex’s acquisition offer in favor of a farm-in agreement with Helix Resources Ltd. Canex argues the Gold Basin board lacks legitimacy, has no shareholder mandate, and is composed of conflicted or resigned members.
• Canex announces the filing of an independent NI 43-101 technical report for its Gold Range project in Arizona, prepared by Burgex Mining Consultants, to rebut Gold Basin’s claims that the project lacks potential for sizable oxide gold deposits.
• The release details severe compliance failures at Gold Basin, including the resignation of its auditor, transfer agent, CFO, and corporate secretary, as well as a cease trade order from the BC Securities Commission, positioning Canex’s offer as the only viable path for liquidity and value for Gold Basin shareholders.

Key Details

• Acquisition Offer Terms: Gold Basin shareholders receive 0.592 of a Canex share for each Gold Basin share held.
• Offer Conditions:
  • Minimum deposit condition of 66-2/3% of outstanding shares (standard for Canadian step-up transactions).
  • 30% lock-up agreement threshold for Canex’s walk right; currently at nearly 29% support.
• Gold Basin Compliance Failures Cited by Canex:
  • Cease Trade Order: Imposed by BC Securities Commission on May 6, 2025, due to failure to file financial statements since September 2024.
  • Management Resignations: CEO, CFO (Stephen Pearce, resigned Sept 25, 2025), Corporate Secretary, and half the board have resigned.
  • Auditor & Transfer Agent: Manning Elliott LLP (auditor) resigned June 28, 2025; TSX Trust Company (transfer agent) resigned Aug 21, 2025. No successors named.
  • Listing Breaches: Gold Basin is in breach of TSX-V requirements for independent directors (only one remains, breached since May 1, 2025) and audit committee composition.
  • Legal Issues: Unresolved civil claims from a former director/CFO (breach of debt settlement) and the former auditor (unpaid fees).
• Technical Report Highlights (Gold Range Project):
  • Effective Date: September 1, 2025.
  • Qualified Person: Mark W. Travis, CPG (Burgex Mining Consultants).
  • Conclusion: The project presents a compelling exploration opportunity with potential for high-grade vein-hosted and bulk-tonnage oxide gold resources. Evidence supports a structurally controlled, multiepisodic mineralizing system.
• Helix Resources Farm-In Criticism:
  • Canex characterizes the Helix farm-in as non-arm's length, noting that one Gold Basin board member has a prior deal for a large stake in Helix.
  • The Helix agreement is described as an option that ties up Gold Basin’s sole exploration asset for years with no obligation for Helix to make expenditures.
  • Gold Basin has not filed the Helix farm-in agreement as required by securities laws, and the TSX-V has not yet approved it.
• Shareholder Support: Key members of Discovery Group (John Robins and Jim Paterson) have signed lock-up agreements supporting the Canex offer.
• Performance Comparison:
  • Discovery Group (Robins/Paterson): Average annualized total shareholder return of 19.60%.
  • Straw/Povey Group (Helix/Gold Basin): Average annualized TSR of minus 15.77%.

Notable Quotes

• "The circular contains numerous glaring inaccuracies and omissions, does not address the mounting liquidity and compliance issues facing Gold Basin, and fails to provide Gold Basin shareholders with a viable path forward."
• "The circular's recommendation has little legitimacy as the Gold Basin board has no mandate from Gold Basin shareholders and has not stood for election in well over a year."
• "Gold Basin is essentially a public company in name only, failing to comply with even the most basic standards of a TSX-V listing, which Canex believes is likely now in jeopardy."
• "The technical report concludes: 'The Gold Range project presents a compelling exploration opportunity within a well-understood geological framework and deposit model. The evidence supports a structurally controlled, multiepisodic mineralizing system with the potential to host both high-grade vein-hosted and bulk-tonnage oxide gold resources.'"