Emergent Metals Corp. Appoints Two New Independent Directors And Provides Several Updates

Executive Summary

• Emergent Metals appointed two new independent directors, Joseph Mullin and Michael Leahy, expanding its board to six members.
• The company provided detailed terms of the pending sale of its Golden Arrow Property to Fairchild Gold Corp., including cash deposit, additional cash on approval, issuance of 12.5 million common shares, a US$3.5 M senior secured note with step‑up principal and 8.5% interest, and a 0.5% NSR royalty with buyout options.
• Updates were also given on the sale of 27 New York Canyon claims to Lahontan Gold Corp., outlining cash, promissory note, share issuance, and a 1% NSR royalty with purchase rights.

Key Details

• Board Appointments
• Joseph Mullin – President & CEO, Rise Gold Corp.; former CEO of QuestEx Gold & Copper Ltd.; extensive mining finance experience.
• Michael Leahy – Advisor to Oroco Resource Corp.; former CEO of a venture‑capital firm; background in corporate development and technology for mineral exploration.

• Resignations: Vincent Garibaldi and Grant T. Smith (Smith remains CFO).

• Golden Arrow Property Sale (Fairchild Gold)

• Cash Deposit: US$250,000 (paid).
• Additional Cash on Exchange Approval: US$350,000.
• Common Shares Issued to Emergent: 12,500,000 shares upon approval.
• Senior Secured Note: US$3,500,000 principal; 5‑year term; 8.5% annual interest (semi‑annual); secured by the property; step‑up principal: $3.5 M (≤3 yr), $4.0 M (3–4 yr), $5.0 M (4–5 yr).
• Royalty: 0.5% net smelter return retained by Emergent; Fairchild may acquire for US$1,000,000 (≤4 yr) or US$1,500,000 (4–7 yr).

• Other Terms: $40,000 reclamation bond funded by Fairchild; escrow of any pre‑closing royalty payments; Fairchild assumes BLM/County fees, taxes, and holding costs post‑closing.

• York Claims Sale (Lahontan Gold)

• Cash Paid to Emergent: US$10,000 (paid).
• Promissory Note: US$50,000 with 1% per month interest, payable within six months of definitive agreement signing.
• Share Issuance: 2,000,000 Lahontan common shares to Emergent upon approval.

• Royalty: 1% NSR on York Claims; Lahontan may purchase royalty for US$500,000 (≤3 yr) or US$1,000,000 (3–7 yr).

• Lahontan Gold Drilling Plans – West Santa Fe Property

• Notice of Operations submitted to BLM for drilling program, access roads, and sumps.
• Historic database: 171 holes (~13,000 m) indicating shallow oxidized gold‑silver mineralization.

• Lahontan’s option to acquire the property: US$1.8 M cash/shares + US$1.4 M exploration spend over seven years.

• Regulatory Treatment

• TSX Venture Exchange classifies Golden Arrow Transaction as a “Reviewable Disposition” for Emergent and a “Fundamental Acquisition” for Fairchild (Policy 5.3).

Notable Quotes

• David Watkinson, President & CEO:

  “The disposition of the Golden Arrow asset for cash, shares, a senior secured note, and royalty interest monetizes Golden Arrow in the short, medium, and long‑term… Emergent management believes that Fairchild can advance Golden Arrow through its next stages of development and ultimately towards production.”

• David Watkinson on York Claims:

  “Emergent management believes the sale of the 27 claims to Lahontan for cash, shares, and a royalty … is the best way to monetize the asset and bring value to Emergent’s shareholders.”

• David Watkinson on West Santa Fe drilling:

  “We are extremely excited to see the first drilling at West Santa Fe since the 1980’s… we hope they will be able to develop West Santa Fe as a satellite deposit to Santa Fe.”