Formation Metals Responds to OTC Markets Request on Recent Promotional Activity

Most Recent Release (April 17, 2026)

• Formation Metals responded to an inquiry from OTC Markets Group regarding recent promotional activity on its common shares.
• The company clarified that third-party marketing materials utilized publicly available information and summaries of previous press releases.
• Management reviewed the materials prior to release and concluded no statements were materially false or misleading.
• CEO Deepak Varshney purchased 100,000 shares on April 16, 2026, coinciding with increased trading volume.
• The company disclosed an IR contract with 1502656 B.C. Ltd (Wagner Media) for $350,000 CAD over six months.
• Trading volume drivers were attributed to recent press releases from February and April.

Historical Context (April 16, 2026 - Drilling Results)

• Significant gold intercepts confirmed at the N2 Gold Project (e.g., 1.8 g/t Au over 21.9m).
• Phase 1 drilling completed 14,466 metres across 46 holes; fully funded 30,000-metre campaign ongoing.
• Maiden Mineral Resource Estimate (MRE) expected in Q3 2026.
• Working capital reported at approximately C$10.5M with zero debt.

Financing and Operations History (Late 2025 - Early 2026)

• Two private placement tranches closed in October/November 2025 raising ~C$8.46M + C$8.26M total proceeds.
• Drill program expanded from 20,000m to 30,000m based on early results.
• Advisory Board appointed Roger Rosmus (Goliath Resources) in February 2026.
• Consistent reporting of wide intercepts supporting an open-pit bulk-tonnage model.

Regulatory and Compliance Risk

• The OTC Markets inquiry indicates heightened scrutiny on promotional activity, which can deter institutional investors wary of "pump" dynamics.
• Management's response mitigates immediate risk by confirming adherence to public information standards and denying false claims.
• Disclosure of the $350k IR contract highlights significant marketing spend relative to a junior explorer, requiring monitoring for ROI efficiency.

Insider Confidence Signal

• CEO purchase of 100,000 shares on April 16 is a strong positive signal validating management's confidence in the project value and recent drilling results.
• This insider buying occurred immediately prior to the OTC response, suggesting alignment between operational success and market conduct.

Fundamental Continuity

• The news does not alter the fundamental asset base (N2 Gold Project) or financial position (zero debt, funded drilling).
• It serves as a clarification of recent price action rather than a new catalyst for value creation.
• The materiality is neutral as it explains market behavior without changing the underlying investment thesis derived from the drilling program.

Project Profile

• Flagship Asset: N2 Gold Property, Quebec, Canada.
• Location: Abitibi Greenstone Belt, 25km south of Matagami, QC.
• Historic Resource: ~871,000 oz Au (18 Mt @ 1.4 g/t) plus RJ Zone (~61,000 oz Au @ 7.82 g/t).
• Geology: Casa Berardi Deformation Zone; open-pit bulk-tonnage potential identified via wide intercepts (>20m thickness).

Exploration Status

• Program: Fully funded 30,000-metre drill campaign (Phase 1 expanded to ~14,000m initially).
• Progress: 15,291 metres drilled across 48 holes as of April 16, 2026.
• Target: Maiden NI 43-101 Mineral Resource Estimate expected Q3 2026 after ~70,000m total drilling (including historic).

Infrastructure

• Year-round road access; proximity to power and processing facilities (Casa Berardi mill).
• Claims cover ~4,400 ha across 87 claims.