Osisko Development closes San Antonio sale to Axo

Executive Summary

• Osisko Development Corp. has completed the sale of its 100% interest in the San Antonio gold project in Sonora, Mexico, to Axo Copper Corp.
• The transaction was structured as the sale of all equity interests in Sapuchi Minera S de RL de CV.
• Osisko received 15,325,841 Axo common shares (9.99% of Axo on a non-diluted basis) and is entitled to significant contingent deferred payments based on tax refunds, feasibility studies, and production milestones.

Key Details

• Transaction Structure: Sale of 100% interest in the San Antonio gold project via the sale of all issued and outstanding equity interests of Sapuchi Minera S de RL de CV.
• Counterparty: Axo Copper Corp.
• Upfront Consideration: Osisko Development received 15,325,841 common shares of Axo, representing 9.99% of the issued and outstanding common shares of Axo on a non-diluted basis at closing.
• Contingent Payment 1 (Tax Refund): Cash payment equal to 70% of any Mexican value-added tax (VAT) refund due or owing to Sapuchi Mexico for periods ending on or before the closing date.
• Contingent Payment 2 (Feasibility Study): $2 million (U.S.), payable in cash or up to 9,398,496 Axo shares at Axo's option, upon the public filing of a NI 43-101 compliant feasibility study.
  • Anti-dilution/Shortfall Protection: If the issue price of Axo shares is below the Nov. 21, 2025, closing price, Osisko receives 9,398,496 Axo shares plus a cash payment equal to the shortfall between $2 million (U.S.) and the U.S.-dollar-equivalent value of the shares received.
• Contingent Payment 3 (Production Milestone): Cash payment of $2 million (U.S.) upon the completion of the first gold pour at the project.
• Anti-Dilution Provision: Upon Axo closing equity financings raising aggregate gross proceeds of at least $10 million (U.S.):
  • If the issue price is greater than the floor price, Axo must issue shares to Osisko to retain a 9.99% interest on a non-diluted basis regarding the initial $10 million raised.
  • If the issue price is less than the floor price, Osisko receives a maximum of 5,521,699 Axo shares plus a cash payment equal to the issue price multiplied by the number of additional shares Osisko would have received if issued at the issue price instead of the floor price.
• Legal Adviser: Bennett Jones LLP acted as legal adviser to Osisko Development.

Notable Quotes

• None provided in the text.