Q2 Metals Corp. announced that it has entered into three individual option agreements which gives the Company the exclusive right and option for the acquisition of a 100% interest in three groups of minerals claims, collectively known as the Cisco Property, subject to the retention by certain vendors of a gross metals return royalty, as further detailed below. The Cisco Property is located in the southern portion of Eeyou Istchee James Bay, Quebec, Canada. Subject to TSX Venture Exchange (the "TSXV") acceptance, the Company will acquire an Option to acquire the Cisco Project for total consideration of an aggregate of 60,000,000 common shares of the Company (the "Consideration Shares"), $2,400,000 (the "Cash Consideration") and $12,000,000 in exploration expenditures. The following are the terms for each of the three mineral claim groups being acquired: Pursuant to the terms of an option agreement between the Company and 9490-1626 Quebec Inc. (the "Cisco Vendor") dated February 28, 2024 (the "Cisco Agreement"), in order for the Company to exercise the option to acquire a 100% interest in 121 mineral claims (the "Cisco Claims") from the Cisco Vendor, the Company must pay to the Cisco Vendor total consideration of an aggregate of 40,000,000 Common Shares, $2,000,000 and $12,000,000 in exploration expenditures. Upon satisfaction of the above payments and expenditures, the Company will earn a 100% interest in the Cisco Claims. The Cisco Vendor will retain a 4% gross metals returns royalty ("GMR") on the Cisco Claims, of which up to 3% of the Cisco GMR can be purchased by the Company at any time prior to commercial production for $1,500,000 on the first 1%, $3,000,000 on the next 1% and a right of first offer on the next 1% at a price to be determined based on fair market value of the Cisco GMR at the time of such purchase. The foregoing Cisco GMR purchase payments may be satisfied in either cash or Common Shares, at the election of the Company. The Cisco Vendor will also be paid a cash bonus of $2,500,000 on the completion and delivery of an initial mineral resource calculation report, prepared in
accordance with National Instrument 43-101 - Standards of Disclosure for Mineral Projects, on the Cisco Claims demonstrating an inferred resource (or higher category) of at least 25 million tonnes grading over 1% Li2O. Pursuant to the terms of an option agreement between the Company, 9219-8845 Quebec Inc. ("9219"), Steven Labranche and Anna-Rosa Giglio (the "Broadback Vendors") dated February 28, 2024 (the "Broadback Agreement"), in order for the Company to exercise the option to acquire a 100% interest in 24 mineral claims (the "Broadback Claims") from the Broadback Vendors, the Company must pay to the Broadback Vendors total consideration of an aggregate of 10,000,000 Common Shares and $200,000 as follows: Upon satisfaction of the above payments and expenditures, the Company will earn a 100% interest in the Broadback Claims. 9219 will be granted a 3% gross metals returns royalty on the Broadback Claims (the "Broadback GMR"), of which up to 2% of the Broadback GMR can be repurchased by the Company at any time prior to commercial production for $1,000,000 for the first 1% and $2,000,000 for the next 1%. The foregoing Broadback GMR purchase payments may be satisfied in either cash or Common Shares, at the election of the Company. Pursuant to the terms of an option agreement between the Company, 9219, Steven Labranche, Anna-Rosa Giglio and Trent Potts dated February 28, 2024, in order for the Company to exercise the option to acquire a 100% interest in 77 mineral claims from the Ouagama Vendors, the Company must pay to the Ouagama Vendors total consideration of an aggregate of 10,000,000 Common Shares and $200,000 as follows: Upon satisfaction of the above payments and expenditures, the Company will earn a 100% interest in the Ouagama Claims. The Ouagama Vendors will be granted a 3% gross metals returns royalty on the Ouagama Claims (the "Ouagama GMR") of which up to 2% of the Ouagama GMR can be repurchased by the Company at any time prior to commercial production for $1,000,000 for the first 1% and $2,000,000 for the second 1%. The foregoing Ouagama GMR purchase payments may be satisfied in either cash or Common Shares, at the election of the Company. No finder's fee is payable in connection with the Option. The Option remains subject to TSXV acceptance. The Cisco Vendors, Broadback Vendors and Ouagama Vendors are expected to severally undertake to
not acquire or hold, together with any person acting jointly or in concert with such vendor, more than 9.9% of the Common Shares outstanding immediately after giving effect to such receipt of Consideration Shares. If any issuance of Consideration Shares will result in a vendor owning more than 9.9% of the Common Shares, such vendor will defer such issuance until such time his or her beneficial ownership of the Company is equal to or less than 9.9% of the Common Shares.