Palamina Completes Financings Totaling $3,050,000 as Part of Colt Silver Spin-Out Transaction

• Event: Completion of financings totaling $3,050,000 as part of the Colt Silver spin-out transaction.
• Structure: Palamina shareholders receive 0.33 shares of Colt Silver for every one share of Palamina held; Palamina retains ~10% of Colt Silver.
• Financing Details: $600,000 via secured convertible debentures (5% interest, maturity Dec 31, 2026) and $2,450,000 via subscription receipts (convertible at $0.15/share).
• Use of Proceeds: Exploration, drilling, community relations, engineering studies, and working capital for both Palamina and Colt Silver assets.
• Timeline: Transaction anticipated to close in July 2026; shareholder approval expected late Q2 2026.
• Context: This follows the February 27, 2026 announcement of the spin-out and financing terms, confirming execution of previously disclosed plans.

• Capital Injection: The $3.05M raise is material for a $16M market cap company (~19% of equity value), providing essential liquidity to advance projects without immediate distress.
• Execution Risk Mitigated: Closing the financing removes uncertainty regarding capital availability for the spin-out, validating management's execution capability compared to previous private placements in late 2025.
• Dilution Reality: The subscription receipts and debentures introduce significant future dilution (approx. 39% of Colt Silver owned by investors). While cash is positive, shareholder value per share will be diluted upon conversion/exchange.
• Debt Obligation: The $600k debenture carries a maturity date of December 31, 2026. This creates a refinancing risk within the next 8 months if project milestones are not met to justify equity raises or asset sales.
• Market Expectation: Since terms were disclosed in February 2026 (rated Material - Positive), this closing is largely priced in. The lack of new strategic surprises limits upside potential relative to the initial announcement.

• Strategy: Consolidation of gold, silver, and copper projects in Peru; value creation via spin-out (Colt Silver) and accelerated drilling.
• Flagship Project (Palamina): Usicayos Gold Project (Santa Lucia District, Puno). Permitted for drill discovery phase.
• Flagship Project (Colt Silver): Galena Silver-Copper-Manganese Project. NI 43-101 report nearing completion; inaugural drilling planned to test CRD mineralization.
• Other Assets: Esperanza (adjacent to Berenguela resource), Pluma (Sediment-hosted Cu-Ag), Gaban, Ica, Volcano, Sora.
• Management Track Record: President Andrew Thomson previously defined ~77 Moz Ag at El Rayo (sold to Agnico Eagle).