Search Minerals Inc. — Remuneration Information 2021

Jun 8, 2021

SEARCH MINERALS INC.

(the “ Company ”)

FORM 51-102F6 STATEMENT OF EXECUTIVE COMPENSATION FOR THE YEAR ENDED NOVEMBER 30, 2020

Introduction

The following information, dated as of June 7, 2021, is provided pursuant to Form 51-102F6V for Venture Issuers, as such term is defined in National Instrument 51-102 – Continuous Disclosure Obligations to provide information about the Company's executive compensation in respect of the financial year ended November 30, 2020.

For the purpose of this Form, a "Named Executive Officer" or "NEO" means (i) each individual who, during any part of the financial year ended November 30, 2020, served as the Company's Chief Executive Officer (" CEO ") or Chief Financial Officer (" CFO "), (ii) the Company’s most highly compensated executive officer (other than the CEO and the CFO), as at November 30, 2020 whose total compensation was, individually, more than $150,000 for that financial year; and (iii) each individual who would have satisfied the criteria in (ii) but for the fact that such individual was neither an executive officer of the Company, nor acting in a similar capacity, at the end of such financial year.

For the financial year ending November 30, 2020, the Company had the following Named Executive Officers: Greg Andrews - President and Chief Executive Officer, Matthew Anderson - Chief Financial Officer, Dr.David Dreisinger – Vice-President of Metallurgy and Dr. Randy Miller – Vice-President of Exploration.

Compensation Discussion and Analysis

The Company does not have a formal compensation program. The compensation of the Company’s NEOs is determined by the Company’s compensation committee (the “ Compensation Committee ”). The Compensation Committee then provides recommendations to the board of directors (the " Board ") for approval. See “Corporate Governance Disclosure - Compensation Committee”.

The general objectives of the Company’s compensation decisions are:

• to encourage management to achieve a high level of performance and results with a view to increasing longterm shareholder value;

• to align management’s interests with the long-term interest of shareholders;

• to provide compensation commensurate with peer companies in order to attract and retain highly qualified executives; and

• to ensure that total compensation paid takes into account the Company’s overall financial position.

The Company’s compensation program is designed to provide competitive levels of compensation, a significant portion of which is dependent upon individual and corporate performance and contribution to increasing shareholder value. The Board recognizes the need to provide a total compensation package that will generally allow the Company to remain competitive compared to its peers in attracting and retaining qualified and experienced executives as well as align the compensation level of each executive to that executive’s level of responsibility.

Elements of Compensation

In general, an NEO’s compensation is comprised of a base salary and/or management fees, annual incentive awards and stock option grants. To date, no specific formulae have been developed to assign a specific weighting to each of these components. Instead, the Compensation Committee considers the Company’s performance and assigns compensation based on this assessment and the recommendations of the Board. The directors of the Company are of a view that all elements should be considered, rather than any single element. In establishing levels of base salary and

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the granting of stock options, the NEO’s performance, level of expertise, responsibilities and time spent are considered.

Compensation Risks

Neither the Board nor the Compensation Committee has formally evaluated the implications of the risks associated with the Company’s compensation policies and practices. Risk management is a consideration of the Board when implementing its compensation program, and the Board and the Compensation Committee do not believe that the Company’s compensation program results in unnecessary or inappropriate risk-taking, including risks that are likely to have a material adverse effect on the Company.

Financial Instruments

The Company’s NEOs and directors are not permitted to purchase financial instruments, including for greater certainty, prepaid variable forward contracts, equity swaps, collars or units of exchange funds that are designed to hedge or offset a decrease in market value of equity securities granted as compensation or held, directly or indirectly, by the NEO or director.

Incentive Plans

Incentive stock options are granted pursuant to the Company’s stock option plan (the “ Stock Option Plan ”), which is designed to encourage share ownership on the part of Management, directors, employees, and consultants. The Stock Option Plan is intended to reinforce commitment to long-term growth in profitability and shareholder value by encouraging share ownership and entrepreneurship on the part of the senior Management and other employees. The Board believes that the Stock Option Plan aligns the interests of the Company’s personnel with shareholders by linking compensation to the longer-term performance of the Common Shares. The granting of incentive stock options is a significant component of executive compensation as it allows the Company to reward each executive officer’s efforts to increase shareholder value without requiring the use of the Company’s cash reserves.

Compensation for the most recently completed financial year should not be considered an indicator of expected compensation levels in future periods. All compensation is subject to and dependant on the Company’s financial resources and prospects.

Share-Based and Option-Based Awards

The Company does not grant share-based awards. Directors, officers, employees and consultants are eligible under the Stock Option Plan to receive grants of stock options. The Stock Option Plan is an important part of the Company’s long-term incentive strategy for its directors, employees and consultants, permitting them to participate in appreciation of the market value of the Common Shares over a stated period of time. The Stock Option Plan is intended to reinforce commitment to long-term growth in profitability and shareholder value. Stock option grants are made on the basis of the position, overall individual performance, anticipated contribution to the Company’s future success and the individual’s ability to influence corporate and business performance. The purpose of granting such options is to assist the Company in compensating, attracting, retaining and motivating the officers, directors and employees of the Company and to closely align the personal interest of such persons to the interest of the shareholders.

Options are granted by either the Board or the Compensation Committee. In monitoring or adjusting the option allotments, the Board or the Compensation Committee, as the case may be, takes into account its own observations on individual performance (where possible) and its assessment of individual contribution to shareholder value and previous option grants. The scale of options is generally commensurate to the appropriate level of base compensation for each level of responsibility. The Board or the Compensation Committee will make these determinations subject to and in accordance with the provisions of the Stock Option Plan. See “Particulars of Matters to be Acted Upon – Approving of Stock Option Plan” below for further details regarding the Stock Option Plan.

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Compensation Governance

In order to assist the Board in fulfilling its oversight responsibilities with respect to compensation matters, the Board has established the Compensation Committee and has reviewed and approved the Compensation Committee’s Charter. The Compensation Committee is composed of George Molyviatis, Jocelyn Bennett and Leo Power. All members of the Compensation Committee are considered independent as such term is defined in National Instrument 52-110 – Audit Committees (“ NI 52-110 ”).

The Compensation Committee meets on compensation matters as and when required with respect to executive compensation. The primary goal of the Compensation Committee as it relates to compensation matters is to ensure that the compensation provided to the NEO’s and the Company’s other senior officers is determined with regard to the Company’s business strategies and objectives, such that the financial interest of the senior officers is aligned with the financial interest of shareholders, and to ensure that their compensation is fair and reasonable and sufficient to attract and retain qualified and experienced executives. See “Corporate Governance Disclosure – Compensation Committee” below for further details regarding powers and operations of the committee.

As a whole, the members of the Compensation Committee have direct experience and skills relevant to their responsibilities in executive compensation, including with respect to enabling the Compensation Committee in making informed decisions on the suitability of the Company’s compensation policies and practices.

Summary Compensation Table

The following table sets forth a summary of compensation paid or awarded to the Company’s NEOs during the Company’s three most recently completed financial years.

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----- Start of picture text ----- Name and Year Salary Share- Option- Non-equity incentive Pension All other Totalprincipal position ($) based based plan compensation value compensation compensationaward awards [(1)] ($) ($) ($) ($)s ($)Annual Long-($)incentive termplans incentiveplansGreg Andrews 2020 180,000 Nil 78,636 90,000 Nil Nil Nil 348,636President & CEO2019 180,000 Nil 23,250 80,000 Nil Nil Nil 283,2502018 180,000 Nil 57,620 55,000 Nil Nil Nil 292,620Matthew 2020 Nil Nil 8,902 Nil Nil Nil 28,176 37,078Anderson2019 Nil Nil 6,200 Nil Nil Nil 22,890 29,090CFO2018 Nil Nil 10,476 Nil Nil Nil 24,258 34,734David Dreisinger 2020 90,000 Nil 37,092 40,000 Nil Nil Nil 167,092Vice-President 2019 90,000 Nil 15,500 35,000 Nil Nil Nil 140,500Metallurgy 2018 90,000 Nil 52,382 25,000 Nil Nil Nil 167,382Randy Miller 2020 138,000 Nil 44,511 40,000 Nil Nil Nil 222,511Vice-President 2019 133,998 Nil 23,250 40,000 Nil Nil Nil 197,248Exploration 2018 129,998 Nil 13,096 Nil Nil Nil Nil 143,074----- End of picture text -----

Notes:

(1) The fair value of option-based awards is determined by the Black-Scholes Option Pricing Model with the following assumptions:

assumptions:
	2020	2019	2018
Risk-free interest rate:	0.85%	1.80%	0.73%
Expected dividend yield:	Nil	Nil	Nil
Expected volatility:	87%	90%	199%
Expected life of option:	5.0 years	3.5 years	3.5 years

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The Company has chosen the Black-Scholes methodology to calculate the grant date fair value of option-based awards as it is the methodology used in the Company’s financial statements.

Narrative Discussion

The Company entered into an employment agreement dated February 1, 2018, with Greg Andrews, (the “ Andrews Agreement ”) pursuant to which Greg Andrews provides services as Chief Executive Officer and President of the Company. Pursuant to the terms of the Andrews Agreement, the Company pays Andrews a salary of $15,000 per month. Effective May 1, 2021, the compensation to Mr. Andrews was increased to $200,000 annually ($16,667 per month). The Andrews Agreement will continue automatically for successive terms of one year. A description of the termination and change of control provisions of the Andrews Agreement are included under the heading “Termination and Change of Control Benefits” of this Circular.

On February 19, 2010, the Company entered into an agreement with Malaspina Consultants Inc. (the “ Malaspina Agreement ”) pursuant to which Matthew Anderson, the Company’s Chief Financial Officer, agreed to provide certain consulting services to the Company. The Malaspina Agreement commenced effective January 1, 2010 and may be terminated by either party on 60 days written notice to the other party. Under the terms of the Malaspina Agreement, the Company agreed to pay Mr. Anderson an hourly rate (fiscal 2020 - $185 per hour), and Mr. Anderson is entitled to participate in any incentive stock option plan as may be available from time to time in the amounts, on the terms and at the time determined by the Board.

On January 1, 2012, the Company entered into a consulting agreement with David Dreisinger and on February 1, 2018 a new consulting agreement was entered into between the parties on substantially the same terms as the original agreement (the “ Dreisinger Agreement ”). Pursuant to the Dreisinger Agreement, Mr. Dreisinger agreed to perform the function of Vice President of Metallurgy to the Company. Effective May 1, 2021 and in consideration thereof the Company agreed to pay Mr. Dreisinger a monthly consulting fee of $9,250 per month ($111,000 per year). By its terms, the Dreisinger Agreement is automatically amended based on changes to compensation approved by the Board. The Dreisinger Agreement is automatically renewed for successive terms of one year until earlier termination in accordance with its terms. No additional director fees are payable to Mr. Dreisinger under the Dreisinger Agreement.

On October 7, 2009, the Company entered into a consulting agreement with Randy Miller (the “ Miller Agreement ”) pursuant to which Mr. Miller agreed to perform the function of rare earth element Vice-President - Exploration to the Company. On December 12, 2011, the Board agreed to increase Mr. Miller’s yearly salary to $200,000 ($16,667 per month). On August 1, 2014, Mr. Miller’s rate was fixed at $130,000 annually ($10,833 per month). In June 2019, the rate was fixed at $138,000 annually ($11,500 per month). Effective May 1, 2021, the compensation to Mr. Miller was increased to $160,000 annually ($13,333 per month). By its terms, the Miller Agreement is automatically amended based on changes to compensation approved by the Board. The Miller Agreement had an initial term of six months and has since been automatically renewed for successive terms of one month, on a month to month basis. These automatic renewals will continue until either the Company or Mr. Miller terminates the Miller Agreement on not less than 14 days’ written notice to the other party.

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Incentive Plan Awards

Outstanding Share-Based Awards and Option-Based Awards

The Company does not have any share-based awards granted to NEOs. The following table sets forth the outstanding option-based awards or each NEOs as at the end of the most recently completed financial year:

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----- Start of picture text ----- Option-based Awards Share-based AwardsName Number of Option Option Value ofsecurities exercise expiration unexercised Number Market or Market orunderlying price date in-the-money of shares payout value payoutunexercised ($) options or units of of share- value ofoptions ($) [(1)] shares based awards vested(#) that have that have not share-basednot vested awards notvested ($) paid out or(#) distributed($)Greg Andrews 1,100,000 0.08 August 14, 2021 Nil Nil Nil NilPresident & CEO1,500,000 0.08 February 7, 2023 Nil Nil Nil Nil2,650,000 0.08 November 17, Nil Nil Nil Nil2025Matthew 200,000 0.08 August 14, 2021 Nil Nil Nil NilAnderson400,000 0.08 February 7, 2023 Nil Nil Nil NilCFO300,000 0.08 November 17, Nil Nil Nil Nil2015David Dreisigner 1,000,000 0.08 August 14, 2021 Nil Nil Nil NilVice-President1,000,000 0.08 February 7, 2023 Nil Nil Nil NilMetallurgy1,250,000 0.08 November 17, Nil Nil Nil Nil2025Randy Miller 250,000 0.08 August 14, 2021 Nil Nil Nil NilVice-President1,500,000 0.08 February 7, 2023 Nil Nil Nil NilExploration1,500,000 0.08 November 17, Nil Nil Nil Nil2025----- End of picture text -----

Note:

(1) “In-the-Money Options” means the excess of the market value of the Company’s shares on November 30, 2020, over the exercise price of the options. The market price for the Company’s common shares on November 30, 2019, was $0.045.

Incentive Plan Awards – Value Vested or Earned During the Year

During the year ended November 30, 2020, the Company granted an aggregate of 5,700,000 stock options to NEOs at the fair value of $0.0297 per stock option using the Black-Scholes Option Pricing Model with the following assumptions: stock price - $0.05; exercise price - $0.08; expected life – 5.0 years; expected volatility – 87% and expected dividends of $nil. The stock options vested on the date of grant.

Narrative Discussion

The following information is intended as a brief description of the Stock Option Plan.

1. The maximum aggregate number of shares that may be issued upon the exercise of stock options granted under the Stock Option Plan shall not exceed 10% of the issued and outstanding share capital of the Company, the exercise price of which, as determined by the Board in its sole discretion, shall not be less than the last closing price of the Company’s shares traded through the facilities of the TSX Venture Exchange (the “Exchange”) prior to the announcement of the option grant, or such other price as may be required or

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permitted by the Exchange, or if the shares are no longer listed for trading on the Exchange, then such other exchange or quotation system on which the shares are listed or quoted for trading.

1. The Board shall not grant options to any one person in any 12-month period which will, when exercised, exceed 5% of the issued and outstanding shares of the Company or to any one consultant or to those persons employed by the Company who perform investor relations services which will, when exercised, exceed 2% of the issued and outstanding shares of the Company.

2. Upon expiry of an option, or in the event an option is otherwise terminated for any reason, the number of shares in respect of the expired or terminated option shall again be available for the purposes of the Stock Option Plan. All options granted under the Stock Option Plan may not have an expiry date exceeding five years from the date on which the Board grants and announces the granting of the option.

3. If the option holder ceases to be a director, officer, employee or consultant of the Company (other than by reason of death) then the option granted shall expire on a date stipulated by the Board at the time of grant and, in any event, must terminate within 90 days after the date on which the option holder ceases to be a director, officer, employee or consultant, subject to the terms and conditions set out in the Stock Option Plan.

The Board retains the discretion to impose vesting periods on any options granted. In accordance with the policies of the Exchange, stock options granted to consultants performing investor relations services must vest in stages over a minimum of 12 months with no more than one-quarter of the stock options vesting in any three-month period.

Pension Plan Benefits

The Company does not have a pension plan that provides for payments or benefits to the NEOs at, following, or in connection with retirement.

Termination and Change of Control Benefits

As indicated earlier in this Circular, the Company has entered into the Andrews Agreement with Mr. Greg Andrews. Pursuant to the terms of the Andrews Agreement, if within twelve (12) months following a Change of Control (as defined below), the Andrews Agreement is terminated by the Company without cause, or if Mr. Andrews resigns with or without good cause within twelve (12) months following a Change of Control, then in either case he will be entitled to receive as severance an amount equal to two times his yearly remuneration or $400,000. In addition, if Andrews Agreement is terminated without cause at any time other than following a Change of Control, Mr. Andrews is entitled to receive a severance payment of $200,000.

A “Change of Control” is defined in the Andrews Agreement as (a) the acquisition, directly or indirectly, by any person or group of persons acting jointly or in concert, as such terms are defined in the Securities Act (British Columbia), of common shares of the Company which, when added to all other common shares of the Company at the time held directly or indirectly by such person or persons acting jointly or in concert, constitutes for the first time in the aggregate 50% or more of the outstanding common shares of the Company and such shareholding exceeds the collective shareholding of the current directors of the Company, excluding any directors acting in concert with the acquiring party; or (b) the removal, by special resolution of the shareholders of the Company, of more than 51% of the then incumbent Board, or the election of a majority of Board members to the Board who were not nominees of the Company’s incumbent Board at the time immediately preceding such election; or (c) consummation of a sale of all or substantially all of the assets of the Company; or d) the consummation of a reorganization, plan of arrangement, merger or other transaction which has substantially the same effect as (a) to (c) above. The Company has not entered into any other contract, agreement, plan or arrangement that provides for payments to a NEO at, following or in connection with any termination (whether voluntary, involuntary or constructive), resignation, retirement a change in control of the Company or a change in an NEOs responsibilities.

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Director Compensation

The following table sets forth all amounts of compensation provided to the directors of the Company (other than directors who are also NEOs) during the Company’s most recently completed financial year:

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----- Start of picture text ----- Name Fees Share- Option- Non-equity Pension All other TotalEarned based based inventive plan value compensation ($)($) awards awards [(1)] compensation ($) ($)($) ($) ($)Jocelyn Bennett 18,000 Nil 44,511 Nil Nil Nil 62,511George Molyviatis [(2)] 18,000 Nil 44,511 Nil Nil Nil 62,511Leo Power 18,000 Nil 19,288 Nil Nil Nil 37,288----- End of picture text -----

Note:

(1) The fair value of option-based awards is determined by the Black-Scholes Option Pricing Model with the following assumptions:

Risk-free interest rate: 0.85% Expected dividend yield: N/A Expected volatility: 87% Expected life of option: 5.0 years

The Company has chosen the Black-Scholes methodology to calculate the grant date fair value of option-based awards as it is the methodology used in the Company’s financial statements.

Narrative Discussion

Directors are compensated through the grant of stock options, however, no stock options were granted to directors in the last fiscal year. Independent directors are paid directors fee of $1,500 per month. Effective May 1, 2021, the director fees will be $3,000 per month.

Outstanding Share-Based Awards and Option-Based Awards

The Company does not have any share-based awards granted to directors. The following table sets forth details of the outstanding option-based awards for each director of the Company (other than directors who are also NEOs) as at the end of the most recently completed financial year:

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		Option-based Awards	Option-based Awards		Share-based Awards	Share-based Awards
Name	Number ofsecuritiesunderlyingunexercisedoptions(#)	Optionexerciseprice($)	Option expirationdate	Value ofunexercisedin-the-moneyoptions($)(1)	Number ofshares or unitsof shares thathave not vested(#)	Market orpayout value ofshare-basedawards thathave not vested($)
Jocelyn Bennett	650,000650,0001,500,000	0.080.080.08	August 14, 2021February 7, 2023November 17,2021	NilNilNil	NilNilNil	NilNilNil
George Molyviatis(2)	650,000650,0001,500,000	0.080.080.08	August 14, 2021February 7, 2023November 17,2021	NilNilNil	NilNilNil	NilNilNil
Leo Power	650,000650,000650,000	0.080.080.08	August 14, 2021February 7, 2023November 17,2021	NilNilNil	NilNilNil	NilNilNil

Notes:

(1) “In-the-Money Options” means the excess of the market value of the Company’s shares on November 30, 2020, over the exercise price of the options. The market price for the Company’s common shares on November 30, 2020 was $0.045.

Incentive Plan Awards – Value Vested or Earned During the Year

During the year ended November 30, 2020, the Company granted an aggregate of 3,650,000 stock options to directors of the Company (other than directors who are also NEOs) at the fair value of $0.0297 per stock option using the BlackScholes Option Pricing Model with the following assumptions: stock price - $0.05; exercise price - $0.08; expected life – 5.0 years; expected volatility – 87% and expected dividends of $nil. The stock options vested on the date of grant.

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