Hochschild's Tiernan Gold and Railtown Capital Announce up to $65M Private Placement Equity Financing and Execution of Definitive Agreement for Proposed Qualifying Transaction

Executive Summary

• Tiernan Gold Corp. and Railtown Capital Corp. entered a definitive business combination agreement that will result in a reverse‑take‑over, creating a new TSX Venture‑listed issuer (“Resulting Issuer”) focused on the Volcan gold project in Chile.
• Up to CAD $65 million will be raised via a best‑efforts private placement of Tiernan Subscription Receipts at $7.50 each, with an additional Agents’ Option for up to 1,300,000 receipts (potential extra $9.75 M).
• Post‑transaction ownership is projected at ≈67% Hochschild, 13.4% existing Railtown shareholders, and ≈19–22% new investors (depending on exercise of the Agents’ Option).

Key Details

• Definitive Agreement: Three‑cornered amalgamation – Tiernan & Subco → Amalco; then Amalco + Railtown → Resulting Issuer.
• Financing Structure:
• Up to 8,666,667 Subscription Receipts at $7.50 each = CAD $65 M gross proceeds.
• Proceeds split: up to CAD $35 M from Tiernan treasury issuance; up to CAD $30 M from secondary sale of Tiernan shares owned by Hochschild.
• Agents’ Option: Up to 1,300,000 additional receipts at the same price for an extra CAD $9.75 M, exercisable ≤48 h before financing close.
• Escrow & Release Conditions: Funds held in escrow; if conditions (including TSXV approval and all closing prerequisites) are met within 90 days, treasury portion released to fund the Resulting Issuer’s operations (Volcan Project, payables, general corporate). Secondary‑sale proceeds flow to Hochschild.
• Commission: Agents receive 6% of gross financing proceeds upon satisfaction of escrow conditions.
• Railtown Consolidation: 0.2820212:1 share consolidation pending TSXV approval; post‑consolidation each Tiernan Share converts to one Resulting Issuer common share.
• Resulting Ownership (without full Agents’ Option):
• Hochschild – 67.2%
• Current Railtown shareholders – 13.4%
• New investors – 19.4%
• Resulting Ownership (if Agents’ Option fully exercised):
• Hochschild – 64.3%
• Current Railtown shareholders – 13.4%

• New investors – 22.3%

• Board Composition: Upon closing, board will consist of existing directors (Chris Taylor, Greg McCunn, Claudia Tornquist, Eduardo Noriega, Nicolas Hochschild) plus Fausto Di Trapani (CEO) and Jill Gardiner (Chair).

• Annual General & Special Meeting (AGSM): Railtown plans an AGSM on 12 Nov 2025 to seek shareholder approvals related to the transaction and a new long‑term incentive plan.

• Financial Snapshot for Tiernan (unaudited, USD ‘000):

• Total assets – $83,135 (June 30 2025) vs $47,362 (Dec 31 2024)
• Shareholders’ equity – $81,748 vs $46,372

• Net income – $31,839 vs $168

• Conditions Precedent: TSXV approval, regulatory consents, shareholder approvals (if required), satisfaction of escrow release conditions, completion of Railtown consolidation, execution of financing, delivery of technical report for Volcan Project, among others.

Notable Quotes

(No direct CEO/President quotes were provided in the release.)