To: Public

From: Peter Bell

Date: April 29, 2023

RE: Update on Q1 2023 for Kermode

We've published our first quarter MD&A already, which has a management commentary on business activities, which are ongoing. My summary of Q1 is pretty short. Read the MD&A for more.

What's happened since then since the period end? There's been some things happen. Lots of talk, not a lot of action. Or a lot of things started but not completed. Yet. That may be a better way to say it.

Here we are at the end of April, 2023. October 31st is fiscal year end so we are now at the end of Q2 shortly. I would love to be able to file the quarterlies a couple of weeks after the end of the quarter. They give us four weeks. Let's do 48 hours! Or two weeks? What's an aggressive timeline that would help us stand out for good disclosure? Imagine if we did a good quality comprehensive MD&A with a highly accelerated timeline. Can we combine those two things? Let's go!

What is it? More of the same? Yes, and that may not be as obvious as it sounds. There’s a lot going on. One of the things that I must fix immediately is to set a new shares-for-services agreement with the 911 crew because we have a limit of $20,000 per month on their contract and we need to increase that. Pick a number and that is the total monthly maximum. Then, the minimum is zero. On we go from there.

I'd like to sign other such service agreements. I like one for the CEO. I'd like one for the CFO. Five thousand dollars each per month for those two positions is the max per individual and the max for all insiders total.

That's three new shares for services agreements. Each of those costs a thousand dollars now. The exchange increased their fees. Last year it was $500. Now it's a thousand to open such a file. We already paid to open one of them with 911 back in Q1 this year, but they won't amend it. If we want to increase the amount monthly maximum, then we got to make a new file and pay a thousand dollars again. Okay! Why? … Anyways, that's dealing with the exchange.

And I want to do the some of these LOIs we have out. I want to close on some of those. I believe they are not particularly expensive. I think KHRYSOS was $5,000 last year. What's it gonna be this year? Could be ten grand? Would that be a lot? $10,000 exchange fees on a property transaction for 16M shares at a penny, which is $160,000 of stock?Okay. How many of of those are we doing? How much money did we raise? Who's paying for this?

One of the guiding light principles for everything I've been doing is that you treat your partners really well. That keeps it all super simple when we're doing all this business development stuff with Kermode.

The one thing we can do is print shares. I’ve said that since day one, as well. Talk about controversial, right? Let's go!

Good luck getting your partners to carry you, they say. Everybody says that's impossible? But there are these weird stories out there in the market of like carried positions that worked. They're mostly unsuccessful. The ones I know are not big winners, but there's some deal flow out there that I've invested in myself that has these kinds of carried positions with some positive cash flow.

Shoutout to Omineca Mining OMM. Hilarious to see all the trolling around that name. Totally inappropriate. CEO dot ca is asleep at the wheel on that and totally neglectful in my opinion. They have responsibilities to keep an orderly community and same our board. There's a former senior officer who posts online extensively and in a derogatory way. At some point that should stop, right? I guess not! Keep doing it as you wish.

And this recording can tag both companies, too. Imagine these two hate communities link up? Maybe they have something in common here? If the OMM trolls follow me over to my company and meet up with GOLDBULLDOG then we have the Milkmen and the bulldogs, milking the bulldogs? I don't know. I don't think that's very funny at all, but I still have to laugh at it. What else you can do, you know? Cry? Nope, probably not. Not about this.

A random thing to mention is the buddy Rodney Ireland was trying to do a BAY STREET RADIO session this week for me to call in. I went through all the trouble of even installing Twitter on my phone so I could participate in the Spaces. He canceled it. Sorry Rodney, please let’s try again. Thank you, buddy! We'll get you next time. I'm ready for a 24/7 365. Then I uninstalled Twitter off my phone because I don't have any social media apps logged in on my phone. I’m trying to do like a “dumb phone”. There's such things as a smartphone, but what is a dumb phone? There's a product called Punkt MP01 that is like a dumb phone. I don't know if it's any good. Communications tech is super cool.

Another random thing I'll mention is to shout out Nuggetz. A friend from CEO dot ca who's reached out a couple times and talked to me about the company. What we should do in the future. He's got lots of amazing ideas and I want to make deals happen. I want to do bullish deals, so bring them on. Bring me deals I can sign. As I said to him and have said publicly many times to anyone who will listen, the way to build my deals is to start with the tip of the spear. That means the guys swinging hammer, who's doing the work. They're in the room getting stock. And generally after that, we include other people who can be helpful as part of the deal.

I say that with Kermode I get to “set the table”. I'm here as a CEO trying to instigate as much action as I can in the hopes that some blows back on us because I believe in the power of positive networking like Shepa learning company. There's a community service aspect to what I do. It's a lot of fun and it makes it really rewarding.

Maybe a third third random thing to mention is a friend from Victoria who I visited yesterday. I have been talking about giving him incentive compensation with these performance share units. There are some guys that can be really helpful from a corporate advisory role at the right time. There's not many people who know what I'm doing or understand it or are tracking it very accurately. I don't think so, at least. The junior mining investor who lives in the same city as me should be somebody that I associate with, right?

And shoutout Charles Funk. I wish I would meet up with you! You live like a 10 minute drive from where I'm sitting right now. I’m at Cadboro Bay and you're in Cordova Bay, like the other side of Mount Doug. Oh, man! Look at what you have accomplished! Charles Funk is impressive. The fact that you're sitting here in Victoria is wild. Whatever you're doing, keep it up! Very good. You’re a credit to Canadian mining. You’re a credit to BC. You’re a credit to Vancouver. You’re a credit to Victoria. Let's go. Let's find gold.

Shoutout Heliostar HSTR

Before we announced the financing for Kermode, we had all these LOI come out. There were at least four new property deals, two in BC, one in Ontario, one in Newfoundland. I continue to spend a lot of time and effort trying to find new project ideas and encourage guys to bring us better, newer projects. Or older projects -- new takes on old things.

I posted some of my emails I've sent guys about oil. I think oil plays are really cool. The potential for positive cash flow in Kermode is bullish. It would really help me feel more comfortable about the stability of the company if we could print our way into some cash flow. That's pretty cool.

Judy Baker and Argo Gold have made this successful transition and change of business to an oil and gas issuer. Now they're in production. I went to her and said, “Judy you rock! You still have mining properties, right? Can I option those and pick up some of your cash flow from your oil?” She said talk to these other guys first who tried to sell me cash flow for paper. Okay. I'd rather buy it from you, Judy, at another PubCo because pubcco-pubco deal flow is always more bullish. And I so far have had no success with pubco deal flow in Kermode. I'm having prolific success, in my opinion, with private market deal generation from prospectors that is increasingly bullish.

I don't have the ability to meet any of these work commitments that other pubco want. My best hope may be to get some copper samples from the crew on the island up to Milo and for Milo to take them to his job and when Hudbaby becomes the owner of that operation where he works Copper Mountain. Imagine he gets to send it to his colleagues around the world?

And I wonder if we can get bornite off a table? Can you pan a concentrate of bornite from this rock they are finding on the island? I don't know. I don't know anything about that, other than the trick with the nail plating copper from loose surface material that I saw at Kintavar’s project years ago. Great field technique for high-grade copper. I don’t know the mineralogy and separation stuff but the some of the showings these guys have been finding recently have that kind of weathered, oxidized, altered, and friable stuff with lots of fancy looking copper minerals. Crush that up in a cement mixer with some steel balls and put that over a shaker table once, twice, or three times. Put it through the cone gravity separator as well, or do that first? Mark Brazeau has some story about making a cone separator out of a cake tin. Like an angel food cake tin? Something like that. What are you talking about? There's so much knowledge out there in the business with all these guys. My job is to unleash them and encourage them and help them accomplish things in a way that accrues to the company because I have a fiduciary duty.

It’s very simple in a lot of ways, but difficult to navigate in a world where I've never met a lot of these people. There's some concern about doing too much, but I would say the bigger concern for me is doing too little. My reason is most of these things fail.

The other management from this company give an example of doing one thing at a time. And even how much of it would they do? Kermode had the Eastgate project for a long time but never really spent any money on it, from what I can tell. The book value was written off once, and we spent a bit on it then wrote it off again. What is that?

There’s a bunch of interesting stuff with Kermode. Like the old insider debt too that's still carried. on the books. It is on our annuals. And there is debt to me for exchange fees and lawyer fees already. There's all kinds of stuff with this Kermode shell. How do you fix this?

Tick, tock, tick, tock.

The one thing you can do is just print. I'll take shares, right? And if there's no financing -- if there's no interest in the financing then presumably the stoc is overpriced right? Supply and demand -- if you can't clear the market then drop the price. It seems obvious enough but how do you do that? Well, you do 10:1 rollback. If you roll it back 10:1 then you don't need a shareholder vote. Don’t need exchange approval. What will the Board of Directors say? And where do you go from there? You have to think about market cap in terms valuation versus cost of work. That's a very detailed set of ideas that I've explained to people, but most people wouldn't really care about it. We can do up to 100% dilution on 12 months rolling basis on the TSXV under five cents right now. A 100% dilution today would be 220 million shares, approximately. We’ve got 150M almost now, so it’s another 70M from here. Can we do something accretive to the company with those shares? By January 2024, we can go to 280. We have around 150M right now and we can print 130M more by January 2024. Specifically, we have 147M today so it will we allow us to go up to 298M in April 2024. Without a rollback and continuing to finance below five cents. Look at the one cent minimum financing price with three hundred million shares as a three million market cap -- would that be overvalued for Kermode in April 2024? Would we be completely unable to raise money at that price? What about two or three years from now? Can we talk about what the company looks like five years from now in some aspects? We can, right? Like, if we don't do a rollback then we have this upper limit on how much shares we can print and the question becomes what are we printing shares for in the mean time? The answer is basically everything. We don't have a source of revenue or cash flow to pay for things, so everything is risk capital and equity. It is dilution on an ongoing basis. Where do we want to be diluting? When I joined the company, it was 66 million shares out with a nine million dollar accumulated deficit, which means the average financing price was 10-15 cents over the life of the company. Since I've joined the company, the average financing price is more like one-two cents. One-tenth lower than the old price. And we've doubled the share count more than when I joined at 66M shares since we're at 147M nowWhat is going on? And the answer is we're printing shares to do work. We're printing shares for properties. Let's print shares to solve problems and create opportunities.There are debts that we can settle with shares, like my debts to the company. Yes, please! But I'd like to do it in a careful way. I don't want to do in the middle of a financing. You have to reprice the financing or whatever, but that not an issue with the stock trading below the financing price. Shoutout to the guys who tried to help me get the stock trading above the financing price. One of them has been out of commission with cancer and I hope he is alive a year from now.

All these other deals going on where we continue to be focused on aggressively capitalizing our partners in property option deals and doing shares for services on exploration work. The conversations I've had with Milo about shares for services for work and property stuff is very bullish. I think he has such high-value potential. His work experience with underground mining and now this pit geology that he does -- he's always been production minded but now more than ever. His potential corporate impact is tremendous. He's talked about some pretty bullish stuff. The more we can do with him the better.

There's lots of other stuff going on. Just to circle back to the guy from Victoria -- that's a potential two-for-one because he could bring his son to work with us. We could hire one of his sons who's potentially brilliant. And now that's something that is a theme with Kermode. We have that with Justin Deveault with 911 Mining where his dad is involved. They are prospecting now with his brother, his, dad, J2, and Justin. Super cool to see the family thing there. I consider that highly investable. And that's now becoming a theme or a trend or a recurring factor in this Kermode deal flow. We could potentially hire this father-son team locally here in Victoria. We would give them PSU upside and shares for services on some corporate advisory work. A lot of what we do is pretty much strategic thinking, like combining opportunity sets like a card game, a gambling card game or strategic game. And this guy’s son may prove to be very good at that kind of thing, so let’s do some “talent development” work here now. That's an unusual thing but I would be proud to do that for a lot of reasons. It's on the table and it's something I'm actively trying to advance locally.

And then a further step away from that local Victoria, we get to our projects in the field. There are all kinds of issues and questions about this. Here at the end of April, my director Maxime Lepine sent me information and said it is really important. A media statement from a local First Nation about sovereignty? Wow! That's very important.

Now, I talk to Max about that stuff more and more. He has a friend in Ucluelet who is worth talking to again. Max introduced me to him again and has me very interested to navigate some of those processes. I think they're pretty straightforward. If we have a crew that can put boots on the ground and have a look around some of these old mine sites that are leaking metal into the environment. Those would be the priority things to send 911 out to have a look. Call it remediation; I call it mining.

The layers of the onion -- there's this Vancouver Island layer of the onion and then there's this layer of the onion that goes further out to where Max lives by Kamloops. There's a bunch of stuff in there where it's like, “wow, really?” Max introduced me to somebody who works as the natural resources manager for the Bonaparte First Nation, a woman named Melanie. It sounds like they have some business going on. I don't think they have any mining exploration happening on their land. I think their land is where the Highland Valley mine wants to go, geologically. I don't know the details of this yet, but there's a potential scenario that's wildly bullish to me where they have the next 20 years of mine life on their ground. I remember Dick Billingsley had some bullish ground around there, too. I think there are still some patents there. edge of the mind over here, there could be some private patents in there as well. I don't know who's who has what land where, but if there is a scenario where this First Nation has a big role to play in the future of that mine. I'm really looking for like baby steps because I think there's a lot of stuff that has a potential to change really significantly and I think it has a potential to improve. This morning I had a thought that maybe it would be easier to deal with the local First Nations government than the BC provincial government? I don't know. It may depend on a lot of factors. Max was telling me a story about how sheets of native copper were used as shields locally? That gives some legal precedent within the Canadian framework for them to have claims to jurisdiction over mining law if there's new legal systems being created? I really don't know a lot of the fundamental stuff that’s going on with these things. I don't know if anybody does, really, so I feel like it's a time to expect surprises. Running towards the big questions is always preferred for us at this point because we're so small that we have to be nimble and quick, to fly under the radar and get things done simply.

There's a lot that I want to do with that the Ucluelet remediation ideas. I want to talk to Maxime more because he said that he knows where an old mine is located? I'm sure it's well known, but I don't know about it!

We're already doing these deals on the island, so these are really important opportunities for us to explore new ways of doing business. We have to be careful not to over-commit to anything. Things can go wrong and there are always surprises, so we must keep developing other opportunities.

I hold my breath for the stuff in Newfoundland. I'm glad to be working with that team of people out there and I want to keep doing that. The Little Bay option deal -- we haven't spent a dollar on it and we're past the date now when we should have issued shares. The other Newfoundland projects are in good standing. They don't have any work commitments, so maintaining them is less of a question. We've done work on the Jonathan's Pond one and have a video about that work coming soon with lab results planned after.

I want to do the deal with Milo. I think I'm going to revise the terms to that. I think Milo is hitting at a level higher than I realized and I want to look at more of like a Caycuse style option agreement with Milo rather than what we had.

I hold my breath for this stuff in Ontario. I think Mark Brazeau is going to bring home the bacon. Totally impossible? You tell me. Don't believe me, just watch. I think there's a huge amount of local skill and knowledge and expertise and good worksmanship that's going on out there and deserves to be supported. I'm right up there to as much as I can. We have one LOI with Mark. Last year we had one that we cancelled. This year he hasn't been to site on that new LOI but his historical data compilation was par excellence. He's very good at what he does with the data compilation. He lives in a remote place in Ontario and doesn't have good internet, so his ability to get us those files is less than it should be. He's not really as plugged in is as he needs to be at his best workwise but he gets stuff done. He hasn't shared that data room for what he created on that new LOI we signed this year. We don't have a QP to review his work on the data compilation yet. That LOI is set to close at the start of June, so there's a month left and we don't have anything other than some really good desktop data work, which is valuable if we go forward with it. Even if we don't go forward with it, it's good to show the kind of work that Mark does because I consider it to be very good and useful. That LOI may go ahead this year or not, flip a coin. I don't know. I would like to see it go ahead. Maybe we change the terms and do it as an exempt transaction, like we've done in BC and Newfoundland. These other guys have been doing deal generation and Mark is totally capable of doing it too. It he’s ever properly capitalized and functional, which he is, then let's see! And maybe now more than ever because my efforts to tell people what to give him a shot. Anyway, our new LOI with him hasn't passed the bar yet in my opinion to be a priority for share issuance. We have other deals that I want to do with Mark, but none of those are ready to go ahead yet either. However, I would go back to the deal from last year.

The deal last year was a deal for private land called the Rumleski farm. It’s approximately a quarter section 160 acres, a rectangular strip that fronts onto the highway. I think it’s the Trans Canada? Across the street is a gold mine on care and maintenance? Down the road is a McEwen gold mine?

This 160 acres is too small for a junior mining company to do a massive geophysics program -- but the right type of method for highly localized geophysics in an area like this could be hugely valuable. There's been pictures of visible gold at surface and may be spinifex texture on what may be millerite nickel minerals? If you’ve got any of these high-grade systems like greenstone gold or nickel sulphides then that can be great on even a small land package. Having a search space of a hundred sixty acres may give better opportunities for some kind of esoteric scientific stuff for exploration. I would rather do a big geophysics budget on a 160 acres rather than 160 square kilometers. If you're seeing high-grade at surface and drilling it then geophysics becomes deposit-scale rather than regional. Poke around and go into small-scale production with bulk sampling because it’s private land -- then profits from that can be like house money and spend that on expensive geophysics. Do we really have a deposit here? There are types of geophysics that work really well at deposit scale for different types. Figure out what that is and go to it. The geophysics gives a roadmap for drilling the deposit, right? Bring in the people who know what they're doing and level-up. When we did the LOI on that deal last year, we based the terms on a deal from Nevada where the owner wants to maintain the private land ownership themselves forever. It was just a mining lease, but the owner of the Rumleski farm would probably prefer to sell for cash. He would probably rather see cash money. Even shares can be a kind expensive type of income, right? He can get a tax bill for the shares and then the shares could go down and not even be worth his tax? Imagine that! Tragic things happen, right? Just keep it simple and do a cash deal if that’s what they want. But how to structure it so that we can afford it with no cash on hand? Well, it could be an exempt transaction for an option to purchase 100% ownership. No sales participation right, not on that one. Royalty, sure if you want. I say no, I'd rather pay more cash and have no royalty. But if you want one with no buy-down then you can have one. Please don't take more than one percent with no buy-down. Preferably all royalties have complete buy-downs because they can be so valuable, right?

A quarter section like that -- what does is go for, real estate wise right now? If you try and sell it -- try. Not wait for a buyer to show up and pay a top price, but actually try to sell it? Less than a million dollars, I think. A deal that I would think works is something like Kermode offers to pay some multiple of market within a multiple number of years. If it's five years, then it's five times market? And then we have an option where any time in the next five years from now, we can elect to take 100% ownership of the claim property for a single cash payment equal to five times market rate when we start the deal. If market price today is a million dollars then it's five million dollars to buy the property. If market is only $200,000 now then it's a million dollar offer. But I figure that if you're gonna pay a million dollars then you can probably pay two. And If you're gonna pay two, then you can probably pay three really. And if a project's gonna be worth paying one million dollars for then it’s probably worth paying 10 million for because it better be really good. My willingness to pay is quite large because I believe it is possible to have big winners. I don’t expect many of them but I want to let them run when they get going! And it’s important that we have enough time to make a good decision. A $10 million payment in five years may be too tight, but maybe a $10 million payment in 10 years is realistic? Does the owner want to wait around that long? Maybe he wants to sell it in two years? Well, let’s make a deal. I think I have some kind of framework here to incentivize people in a realistic way to do these kinds of deals and I think that’s important because there’s a lot of this cool private ground out there in Ontario. If we can do deals on some of those opportunities and structure them all as exempt transactions where we don’t issue shares then that gets interesting. Let's have a look at all these spots because it's zero dollars to start the option. It gives the landowner an opportunity for them to have a look at their project for mining potential. Some of these guys look out the kitchen window and say, “I always figured there was something there. On the back 40, the trees grew weird. I figured it was all the zinc.” What? Base metal vein and gold vein next to it? I don't know geology, but I do know that private ground means you can mobilize pretty quickly. And speed is an advantage. Private ground is a big, big advantage. There's also a lot of it but finding the guys who own it and dealing with them is not easy. I think I have a framework for doing that. Part of it is this messaging I'm doing now which is like communicating the like high-brow version of how I'm constructing these deals, but then also it's not going to be me that finds these guys who own this land -- it's gonna be Mark Brazeau who already knows them! This is his world. He has the potential for a lot of value to help us find these opportunities on a serial basis. That's what I see happening in Ontario. I think there's a lot of private land there that has never been looked at for mining. Some of these old farms where guys have a full section with mineral rights, water rights, timber rights, surface, subsurface -- private land. That is really, really cool. Oh, and it's down the street from a mine but it's never seen a drill hole. There are so many cool things about that kind of project. To clear the ground for exploration in some areas, you'd have to take the trees down first. And since it's your own private land, you can log it. Maybe Maxime Lepine on our board of directors has a special committee to log the trees on a contract basis for profit? Turn a profit when you clear the ground and strip cover before an exploration program? The prep work turns into a profit center? Imagine that!

Is there anything else we're talking about? Probably, at but this point I don't really know what it is! Sorry for jumping around and rambling everywhere, but it's been a while since I've done recording updates. I do this without notes, just impromptu or free-association because it helps me. And then to record it and have a reference of it that I make public to help people understand what I am doing and why. I'll make a transcript to this one. Peter Bell, 10 pm Saturday, April 29th. 2023. Thanks, good night!