Mr. Jason Riley reports

EXGEN SIGNS CARRIED INTEREST AGREEMENT WITH PHOENIX FOR CONSTRUCTION OF THE EMPIRE MINE OPEN PIT PROJECT, IDAHO

ExGen Resources Inc. has provided an update in respect of the development and construction activities at the Empire mine project in Custer county, Idaho, United States. On Dec. 17, 2024, ExGen has signed a carried interest agreement with Phoenix Copper Ltd., whereby Phoenix has agreed to finance all of ExGen's construction and operating costs related to the Empire mine open pit project.

Carried interest agreement

The carried interest agreement is an important milestone for ExGen as it ensures that all funding required by ExGen for the construction and operation of the project will be provided by a loan from Phoenix or its affiliates to Konnex Resources Inc. The carried interest agreement contemplates that Konnex will construct and operate the project as Konnex holds the majority of the leases and claims for the project (with the remainder being held by an affiliate of Phoenix). Further to previous news releases, ExGen owns 20 per cent and Phoenix owns 80 per cent of Konnex. As a result of the carried interest agreement, Phoenix or its affiliates will fund, through a loan to Konnex, all of ExGen's 20 per cent of construction and operating costs for the project, and the loan will be repaid by ExGen to Phoenix from ExGen's 20-per-cent share of the profits from the project. In addition, the carried interest agreement ensures that ExGen's ownership interest in Konnex will not be diluted from 20 per cent as a result of the funding of the construction and operation of the project. In addition, ExGen continues to own 1.33 million common shares of Phoenix. As part of the consideration for the carried interest agreement and to help facilitate the fastest path to production for the project, ExGen has agreed that Phoenix is no longer required to do the following pursuant to the original option agreement, as amended, among ExGen and Phoenix: (i) complete a National Instrument 43-101-compliant feasibility study for the project; (ii) pay to ExGen $100,000 (U.S.) per year; and (iii) complete $500,000 (U.S.) of annual spending on the project.

Jason Riley, chief executive officer of ExGen, commented: "This is a pivotal milestone for ExGen as the carried interest for the project essentially creates a synthetic royalty payout structure with ExGen maintaining its 20-per-cent interest while no longer being required to fund any of the construction or operating costs of the project. This structure removes the upfront funding risk for ExGen and potentially significant dilution if ExGen had to raise the funds directly, or was unable to do so. We look forward to working with Phoenix in helping to advance the project as rapidly as possible towards production."

About ExGen Resources Inc.

ExGen is a project accelerator that seeks to finance exploration and development of its projects through joint ventures and partnership agreements. This approach significantly reduces the technical and financial risks for ExGen, while maintaining the upside exposure to new discoveries and potential cash flow. The company intends to build a diverse portfolio of projects across exploration stages and various commodity groups. ExGen currently has five projects in Canada and the United States.

We seek Safe Harbor.