Mr. Andrew Thomson reports

PALAMINA ANNOUNCES SHAREHOLDER APPROVAL, FINAL COURT APPROVAL AND EXPECTED CLOSING OF COLT SILVER SPIN-OUT TRANSACTION

Palamina Corp.'s previously announced spinout transaction, whereby Palamina will distribute a certain number of common shares of Colt Silver Corp. to the shareholders of Palamina pursuant to a plan of arrangement under Section 182 of the Business Corporations Act (Ontario), has been overwhelmingly approved by Palamina shareholders at an annual and special meeting held on Sept. 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 auditor, and 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 Aug. 24, 2026, and letter of transmittal. A copy of the information circular and other meeting materials can be found on the company's website or under company's profile on SEDAR+.

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 Sept. 25, 2026.

Closing

Palamina and Colt Silver intend to close the arrangement in connection with the spinout transaction, effective Sept. 29, 2026, which will be implemented under the terms of an 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; and (ii) one new common share of Palamina 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.

After markets close on Sept. 28, 2026, the company's common shares will exchanged on a one-for-one basis for new common shares and will delist from the TSX Venture Exchange, and, at market open on Sept. 29, 2026, the new common shares will list and begin trading with Cusip and ISIN 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 to receive the new Palamina common shares and Colt Silver's common shares.

Also on Sept. 29, 2026, pursuant to the terms of the arrangement, Palamina will distribute 23,308,708 common shares of Colt Silver to the shareholders, and Palamina will retain 4,577,766 Colt shares.

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 will be automatically convert 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 will automatically convert into common shares of Finco at a conversion price of 15 cents 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 Sept. 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 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 will also be 100,000 compensation options outstanding exercisable at 15 cents per Colt share for a period of two 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 five cents per Colt share to be issued.

About Colt Silver Corp.

Upon completion of the spinout transaction, Colt Silver will operate as a stand-alone 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 Corp.

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 spinout transaction, Palamina will retain a 9.1-per-cent 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.

We seek Safe Harbor.