Mr. Andrew Thomson reports

PALAMINA CONFIRMS CLOSING OF SPIN-OUT ARRANGEMENT

Palamina Corp. has closed the previously announced plan of arrangement in connection with the spinout of Colt Silver Corp., effective Sept. 29, 2026, as per the company's news release issued on Sept. 25, 2026. Pursuant to the spinout transaction, Palamina distributed 23,308,708 common shares of Colt Silver to the shareholders of Palamina, and Palamina retained 4,577,766 Colt shares.

The spinout transaction was implemented under the terms of an arrangement agreement among the company, Colt Finco Corp. and Colt Silver, pursuant to which the shareholders will receive: (i) 0.25 of one Colt share for every common share in the company held; and (ii) one new common share of the company for every exiting common share. Holders of currently outstanding common share purchase warrants of Palamina are also entitled to 0.25 of one Colt share for every share purchased pursuant to the due exercise of such warrants.

At market close on Sept. 28, 2026, the company's common shares were exchanged on a one-for-one basis for new common shares and were delisted from the TSX Venture Exchange, and at market open on Sept. 29, 2026, the new common shares were listed and began trading with Cusip and ISIN 69607A109 and CA69607A1093. The Palamina ticker symbol continues to be PA.

Colt Silver is now a reporting issuer in British Columbia, Alberta, Saskatchewan and Ontario, and has received conditional approval to list the Colt shares on the TSX-V. Colt Silver will issue a subsequent news release announcing the expected date its shares are to commence trading on the TSX-V under the symbol COLT. Further details about Colt Silver will also be available shortly pursuant to the TSX-V Form 2B (Listing Application) to be filed publicly on Colt Silver's SEDAR+ profile.

Concurrent financings and amalgamation

As part of the spinout transaction, Colt Silver completed a non-brokered private placement financing of secured convertible debentures for $600,000 in gross proceeds on April 17, 2026. The principal and all accrued interest owing pursuant to the debentures were automatically converted into 6,135,613 Colt shares at a conversion price of 10 cents per share in accordance with their terms on Sept. 29, 2026.

Also as part of the spinout transaction, Finco completed a non-brokered private placement financing of subscription receipts for $2.45-million in gross proceeds on April 17, 2026. On Sept. 29, 2026, the subscription receipts automatically converted into common shares of Finco at a conversion price of 15 cents per share and then immediately thereafter were exchanged on a one-for-one basis for Colt shares pursuant to an amalgamation of Finco with a wholly owned subsidiary of Colt Silver. The resulting issuer intends to use the net proceeds of the financings for exploration and advancement of the assets, including drilling, community relations, engineering studies, and general corporate and working capital purposes.

Colt Silver structure

Colt Silver has 50,355,421 Colt shares issued and outstanding, including 23,308,708 Colt shares held by Palamina shareholders (46.3 per cent), 4,577,766 Colt shares held by Palamina (9.1 per cent) and 22,468,947 Colt shares held by the participants in the financings (44.6 per cent). There are 100,000 compensation options outstanding exercisable at 15 cents per Colt share for a period of two years from the date of issuance. Also, Colt Silver has an obligation to issue up to 5,448,075 Colt shares upon the exercise of Palamina warrants and receipt by Colt Silver of five cents per Colt share to be issued.

Filing of technical report

A technical report, prepared in accordance with National Instrument 43-101 (Standards of Disclosure for Mineral Projects) in respect of the Galena silver-copper-manganese project, has been filed on SEDAR+. The technical report was prepared by Steven L. Park, MSc, CPG, for Colt Silver and entitled "NI 43-101 Technical Report: Galena Ag-Cu-Mn Project," effective June 14, 2026. The technical report is available on Palamina and Colt Silver's SEDAR+ profile and on the Colt Silver website. The Galena project will be the qualifying property (within the meaning of TSX-V policies) for the Colt Silver listing application with the TSX-V.

Information regarding the exchange of securities

Registered shareholders -- to receive the new common shares and Colt shares, registered Palamina shareholders must complete, execute and deposit with Computershare Investor Services Inc., the depositary appointed in respect of the arrangement, the letter of transmittal previously mailed to the registered Palamina shareholders and their respective certificate(s)/DRS advice(s) representing their Palamina common shares and any other required documents and instruments, all in accordance with the instructions provided in the letter of transmittal. The letter of transmittal is also available on Palamina's website and under Palamina's SEDAR+ profile.

Non-registered shareholders -- non-registered Palamina shareholders whose Palamina common shares are registered in the name of a broker, investment dealer, bank, or other intermediary or nominee should contact their intermediary for assistance in depositing their new common shares and Colt shares.

For further details on Colt Silver and Palamina, readers are referred to Canadian regulatory filings on SEDAR+ and Palamina's website.

Early warning

Pursuant to the spinout transaction and the financings, Andrew Thomson acquired, directly and indirectly, 4,972,534 Colt shares and 923,750 warrants exercisable for Colt shares at five cents per share. Mr. Thomson did not own any shares of Colt Silver immediately prior to the spinout transaction and financings. Following these transactions, Mr. Thomson has beneficial ownership or exercises direction or control over, directly and indirectly, 4,972,534 Colt shares and 923,750 warrants, representing approximately 9.9 per cent of the outstanding shares of Colt Silver on an undiluted basis and 11.5 per cent on a partially diluted basis. The Colt shares were acquired for investment purposes. Mr. Thomson has a long-term view of the investments, and may acquire additional Colt shares of Colt Silver in the future depending on market conditions, reformulation of plans and/or other relevant factors. This information is being disclosed as required by National Instrument 62-104 (Take-Over Bids and Issuer Bids) and relates to Colt Silver. A copy of the early warning report that has been filed today in connection herewith can be obtained at SEDAR+ under Colt Silver's profile, or by contacting Mr. Thomson at 145 King St. West, Suite 2870, Toronto, Ont., M5H 1J8, telephone: 416-204-7536.

About Palamina Corp.

Palamina is a mineral exploration company with six gold projects in the Puno orogenic gold belt of southeastern Peru. Palamina is primarily focused on advancing its flagship Usicayos gold project. Colt Silver holds seven silver-copper projects across southeastern, northeastern and central Peru, and plans to commence a drill program at its flagship Galena silver-copper project in the fall of 2026.

Upon completion of the spinout transaction, Palamina will retain approximately 9.1 per cent of the equity of Colt Silver, which will operate as a stand-alone public company. The transaction will allow each company to focus on its respective mineral exploration portfolio while providing Palamina shareholders with direct exposure to Colt Silver's silver-copper assets.

Palamina trades on the TSX Venture Exchange under the symbol PA and on the OTCQB under the symbol PLMNF. Colt will trade on the TSX Venture Exchange with the symbol announced after closing.

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