J2 Metals enters deal to spin out Twenty Mile project

Executive Summary

• J2 Metals Inc. has entered into an arrangement agreement to spin out its Twenty Mile project in British Columbia into a new subsidiary, 1558117 B.C. Ltd. (Spinco), via a statutory plan of arrangement.
• Upon completion, J2 shareholders will receive one Spinco share for every J2 share held, effectively splitting the company into two distinct entities: J2 Metals (focusing on Napoleon and Miniac projects) and Spinco (focusing on the Twenty Mile project).
• The transaction is subject to several conditions, including shareholder approval at a special meeting expected in Q4 2025, court approval, TSX-V listing approval, and a private placement raising at least $500,000.

Key Details

• Transaction Structure: Statutory plan of arrangement under the Business Corporations Act (British Columbia).
• Share Distribution: Five million Spinco shares (all issued and outstanding common shares of Spinco) will be distributed to J2 shareholders pro rata.
• Option/Warrant Treatment: Holders of J2 options and warrants exercising before the record date will participate in the distribution. Outstanding J2 warrants will be adjusted to be exercisable into their pro rata entitlement to Spinco shares.
• Fractional Shares: No fractional Spinco shares will be distributed; fractions will be rounded down without compensation.
• Corporate Identity: Spinco is expected to change its name to "Twenty Mile Metals Inc." once the B.C. Registries office reopens following labor action.
• Post-Spinout Focus:
  • J2 Metals: Will focus on the Napoleon project (Alaska) and Miniac project (Quebec).
  • Spinco: Will focus on advancing the Twenty Mile project in the Quesnel trough porphyry belt.
• Conditions Precedent:
  • Shareholder approval by special resolution at a special meeting expected in Q4 2025.
  • Approval of the Supreme Court of British Columbia.
  • Acceptance by the TSX Venture Exchange.
  • Conditional approval for listing of Spinco shares on the TSX-V.
  • Completion of a private placement by Spinco raising aggregate proceeds of at least $500,000.
• Regulatory Status: Spinco will operate as a reporting issuer in BC, Alberta, and Ontario, complying with continuous disclosure obligations.
• Documentation: An arrangement agreement and management information circular (detailing factors considered by the board) will be filed with SEDAR+ and mailed to shareholders.

Notable Quotes

• "The spinout will provide investors with an ownership stake in two separate specialized companies. J2 will continue to focus on the advancement of its Napoleon and Miniac properties, while Spinco will focus on advancing the Twenty Mile project."
• "Following the arrangement, Spinco will operate as a reporting issuer in the provinces of British Columbia, Alberta and Ontario, and will comply with its continuous disclosure obligations under applicable Canadian securities laws."