HM Exploration Expands Pilley's Island VMS District with Acquisition of Lewis Copper Tenure

Executive Summary

• HM Exploration entered a property option agreement to acquire 100% of the Lewis Copper VMS Tenure in Newfoundland, issuing up to 2.7 million common shares and committing $1.5 M‑$1.9 M in exploration expenditures.
• The Tenure adds ~42 km² to HM’s Pilley’s Island land package and contains historic drill intercepts (e.g., 16.77 m @ 1.84% Cu, 5.19 m @ 0.24% Cu‑4.54% Zn‑17.43 g/t Ag‑5.00 g/t Au).
• The transaction includes a 3% NSR royalty (with a C$2 M buy‑back option) and a bonus provision for future sales or resource development, potentially triggering up to C$5 M in additional payments.

Key Details

• Option Structure – HM will earn the full interest by:
• Issuing 2,700,000 common shares at a deemed $0.27 per share on a 50‑50 basis to Unity Resources Inc. and Stephen Stockley Agriculture & Fabrication Inc.
  • 300,000 shares within 10 business days of effective date
  • Four additional tranches of 450,000 shares each due by March 9 2027, 2028, 2029, 2030
  • Final tranche of 600,000 shares due by March 9 2031

• Spending a minimum of $1.5 M in exploration:

  • $900,000 by March 9 2028
  • $1.4 M by March 9 2030 (total $2.3 M)

• Resale Restrictions – All issued shares are subject to a two‑year escrow; optionors must give notice before disposing of >50,000 shares in any 30‑day period and may be required to sell at 98%–100% of the proposed price or at no less than 65% if no buyer is found. Restrictions lift automatically if HM completes a financing at a lower per‑share price.

• Royalty & Buy‑Back – Optionors retain a 3 % NSR royalty on the Tenure; HM may buy back 1.5 % of this royalty for C$2 M.

• Bonus Agreement

• If HM sells the Tenure during the option period, optionors receive an additional 5 % of total cash and non‑cash consideration (split 50/50).

• A separate C$5 M cash bonus is payable if a cumulative mineral reserve/resource ≥2 million AuEq oz is established (NI 43‑101) with NPV ≥ C$1 B, triggered after filing the supporting technical report.

• Historic Intercepts (converted to metric)

• PI‑89‑01: 16.77 m @ 1.84 % Cu (incl. 10.97 m @ 2.34 % Cu)
• PI‑89‑02: 7.63 m @ 0.90 % Cu (incl. 3.05 m @ 1.59 % Cu)
• PI‑89‑03: 5.19 m @ 0.24 % Cu, 4.54 % Zn, 17.43 g/t Ag, 5.00 g/t Au (incl. higher‑grade sub‑intervals)

• PI‑89‑04: 16.70 m @ 1.28 % Zn, 10 g/t Ag

• Exploration Plan – HM intends to commence its inaugural drilling campaign on the Tenure in 2026 pending permit approvals.

Notable Quotes

“This acquisition expands HM’s control of the Pilley’s Island VMS district… We are excited to hit the ground running for HM’s first ever diamond drill program.” – Nicholas Rodway, CEO

All forward‑looking statements are subject to risks and uncertainties as described in the release.