Toronto, Ontario--(Newsfile Corp. - September 25, 2026) - Palamina Corp. (TSXV: PA) (OTCQB: PLMNF) ("Palamina" or the "Company") is pleased to announce that the previously announced spin-out transaction (the "Transaction"), whereby Palamina will distribute a certain number of common shares of Colt Silver Corp. ("Colt Silver") to the shareholders of Palamina pursuant to a plan of arrangement under section 182 of the Business Corporations Act (Ontario) (the "Arrangement") has been overwhelmingly approved by Palamina shareholders ("Shareholders") at an annual and special meeting (the "Meeting") held on September 24, 2026.

The Arrangement was required to be approved by (i) at least two-thirds of the votes cast by the Shareholders entitled to vote at the Meeting; and (ii) a simple majority of the votes cast by the Shareholders entitled to vote at the Meeting, excluding Shares held by certain Shareholders required to be excluded in accordance with Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions. At the Meeting, Shareholders also elected the Company's directors, appointed the Company's auditors, approved the Company's equity incentive plan and Colt Silver's equity incentive plan.

Full details of the Arrangement and certain other matters are set out in the management information circular of Palamina dated August 24, 2026 (the "Information Circular") and letter of transmittal (the "Letter of Transmittal"). A copy of the Information Circular and other meeting materials can be found on Company's website at www.palamina.com or under Company's profile on SEDAR+ at www.sedarplus.ca.

Further, the Company announces that the Arrangement has received the final order of the Ontario Superior Court of Justice (Commercial List) approving the Arrangement at a hearing on September 25, 2026.

Closing

Palamina and Colt Silver intend to close the Arrangement in connection with the spin-out transaction (the "Spin-Out Transaction") effective September 29, 2026, which will be implemented under the terms of an arrangement agreement (the "Arrangement Agreement") among the Company, Colt Finco Corp. ("Finco") 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 (the "Common Shares"); and (ii) one new common share of Palamina (the "New Common Share") for every exiting Common Share. Holders of currently outstanding common share purchase warrants of Palamina (the "Palamina Warrants") are also entitled to 0.25 of one Colt Share for every share purchased pursuant to the due exercise of such Warrants.

After markets close on September 28, 2026, the Company's Common Shares will exchanged on a one-for-one basis for New Common Shares, will delist from the TSX Venture Exchange ("TSXV"), and at market open on September 29, 2026, the New Common Shares will list and begin trading with CUSIP and ISIN numbers 69607A109 and CA69607A1093, respectively. The Palamina ticker symbol will continue to be "PA".

Palamina shareholders who own common shares as at close of business on effective date of the Arrangement will be entitled to 0.25 of a Colt Silver common share for every Palamina common share so held. The Colt Silver common shares are expected to be issued to the beneficial shareholders of Palamina as of the same day. Registered Shareholders who have not already done so must complete and sign the Letter of Transmittal and return it, together with the certificate(s) / DRS advice(s) representing their Shares and any other required documents and instruments, in accordance with the procedures set out in the Letter of Transmittal in order to receive the new Palamina common shares and Colt Silver's common shares.

Also on September 29, 2026, pursuant to the terms of the Arrangement, Palamina will distribute 23,308,708 common shares of Colt Silver (the "Colt Shares") to the Shareholders and Palamina will retain 4,577,766 Colt Shares.

As part of the Spin-Out Transaction, Colt Silver completed a non-brokered private placement financing of secured convertible debentures (the "Debentures") for $600,000 in gross proceeds (the "Debenture Offering") on April 17, 2026. The principal and all accrued interest owing pursuant to the Debentures will be automatically convert into 6,135,613 Colt Shares at a conversion price of $0.10 per share in accordance with their terms on September 29, 2026.

Also as part of the Spin-Out Transaction, Finco completed a non-brokered private placement financing of subscription receipts ("Subscription Receipts") for $2,450,000 in gross proceeds on April 17, 2026 (the "Subscription Receipt Offering", together with the Debenture Offering, the "Financings"). On September 29, 2026, the Subscription Receipts will automatically convert into common shares of Finco at a conversion price of $0.15 per share and then immediately thereafter will be 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 and general corporate and working capital purposes.

On September 29, 2026, Colt Silver will have 50,355,422 Colt Shares issued and outstanding, including 23,308,708 Colt Shares held by Palamina Shareholders (46.3%), 4,577,766 Colt Shares held by Palamina (9.1%) and 22,468,947 Colt Shares held by the participants in the Financings (44.6%). There will also be 100,000 compensation options outstanding exercisable at $0.15 per Colt Share for a period of 2 years from the date of issuance. Colt Silver also has an obligation to issue up to 5,448,075 Colt Shares upon the exercise of Palamina Warrants and receipt by Colt Silver of $0.05 per Colt Share to be issued.

None of the securities issued pursuant to the Arrangement or the Financings have been or will be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. Any securities issued pursuant to the Arrangement are issued in reliance upon available exemptions from such registration requirements pursuant to section 3(a)(10) of the U.S. Securities Act and similar exemptions under applicable securities laws of any state of the United States. This news release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful. About Colt Silver

About Colt Silver

Upon completion of the spin-out transaction Colt Silver Corp. will operate as a standalone public company. The company holds a portfolio of seven silver copper projects located across southeastern, northeastern, and central Peru. Colt's primary focus will be advancing its flagship Galena Silver Copper Project. Colt Silver is focused on creating shareholder value through systematic exploration and the advancement of its portfolio of prospective silver copper assets in Peru.

About Palamina

Palamina is a mineral exploration company with six gold projects in the Puno Orogenic Gold Belt of southeastern Peru. The company is primarily focused on advancing its flagship Usicayos Gold Project. As part of the planned spin-out transaction, Palamina will retain a 9.1% equity interest in Colt Silver, providing Palamina shareholders with direct exposure to Colt Silver's silver copper exploration portfolio while allowing both companies to pursue their respective mineral exploration strategies independently. Palamina trades on the TSX Venture Exchange under the symbol PA and on the OTCQB under the symbol PLMNF.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

This news release contains certain "forward-looking statements" within the meaning of such statements under applicable securities law. Forward-looking statements are frequently characterized by words such as "plan", "continue", "expect", "project", "intend", "believe", "anticipate", "estimate", "may", "will", "potential", "proposed" and other similar words, or statements that certain events or conditions "may" or "will" occur. These statements are only predictions. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking statements throughout this news release. Forward-looking statements include, but are not limited to, the use of proceeds of the Offering and the Company's future business plans. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. The Company is under no obligation, and expressly disclaims any intention or obligation, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by applicable law. A more complete discussion of the risks and uncertainties facing the Company appears in the Company's continuous disclosure filings, which are available at www.sedarplus.ca.

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To view the source version of this press release, please visit https://www.newsfilecorp.com/release/316077

Source: Palamina Corp.