Company: PRMLF
Filing Date: 2025-05-13
Form Type: 10-Q
Source: 0001641172-25-010011
Chunk: 63

Company: NexMetals Mining Corp.
Filing Date: 2025-05-13
Form: 10-Q
Item: Item 1
Chunk 63
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 These payments have been made.

    ●
    US$25,000,000 upon the earlier of: (i) approval by the Botswana Ministry of Mineral Resources, Green Technology and Energy Security (“MMRGTES”) of the Company’s Section 42 and Section 43 applications (for the further extension of the mining licence and conversion of the mining licence into an operating licence, respectively); and (ii) January 31, 2026, the expiry date of the study phase.

    ●
    The third instalment of US$30,000,000 is payable on the completion of mine construction and production start-up by the Company on or before January 31, 2030, but not later than four years after the approval by the Minister of MMRGTES of the Company’s Section 42 and Section 43 applications.

As per the terms and conditions of the Selebi APA,
the Company has the option to cancel the second and third payments and return the Selebi Mines to the BCL Liquidator if the Company determines
that the Selebi Mines are not economical. The Company also has an option to pay in advance the second and third payments if the Company
determines that the Selebi Mines are economical. The Company’s accounting policy is to measure and record contingent consideration
when the conditions associated with the contingency are met. As of March 31, 2025, none of the conditions of the second and third instalments
have been met, hence these amounts are not accrued in the Financial Statements.

In addition to
the Selebi APA, the purchase of the Selebi Mines is also subject to a royalty agreement as well as a contingent consideration agreement
with the liquidator. The royalty agreement consists of a net smelter royalty (“NSR”) of 2% on the net value of sales
of concentrate or other materials with respect to production from the Selebi mining licence, of which the Company has the right to buy-back
50%. The contingent consideration agreement consists of two components: (i) a sliding scale payment of US$0.50/tonne of ore up to US$1.40/tonne
of ore with respect to the discovery of new mineable deposits greater than 25 million tonnes of ore from a base case of 15.9 million tonnes,
with a minimum grade of 2.5% nickel equivalent, accrued at the time of a decision to mine; (ii) price participation of 15% on post-tax
net earnings directly attributable