Emergent enters definitive deal to sell Golden Arrow

Executive Summary

• Emergent Metals Corp. has signed a definitive asset purchase agreement to sell its Golden Arrow property (an advanced-stage gold and silver exploration property in Nevada) to Fairchild Gold Corp.
• The transaction consideration includes upfront cash, equity shares, a senior secured promissory note, and a retained royalty, with the potential for the property to revert to Emergent if conditions are not met.
• The deal is subject to approval by the TSX Venture Exchange and other regulatory approvals.

Key Details

• Transaction Structure: Asset purchase agreement dated March 23, 2026, between Emergent Metals Corp., Fairchild Gold Corp., and their respective wholly-owned Nevada subsidiaries.
• Asset Sold: Golden Arrow property, consisting of 17 patented and 494 unpatented mineral claims located near Tonopah, Nevada.
• Cash Consideration:
  • Fairchild to pay $350,000 (U.S.) upon TSX Venture Exchange approval.
  • This is in addition to a previously paid non-refundable deposit of $250,000 (U.S.).
• Equity Consideration:
  • Fairchild to issue 12.5 million common shares to Emergent upon exchange approval.
  • Deemed price per share equals the closing price of Fairchild’s common shares on the last trading day prior to issuance.
• Senior Secured Note Terms:
  • Principal Amount: $3.5 million (U.S.).
  • Term: Five years from the date of the definitive agreement.
  • Interest Rate: 8.5% per annum, payable semi-annually in arrears in cash.
  • Security: First-ranking security interest over the property and related assets.
  • Early Repayment Bonus: If Fairchild repays at least $500,000 immediately upon closing a financing of no less than $3 million (U.S.), and an additional $2.5 million within six months of the agreement date, Emergent waives the remaining $500,000 principal.
  • Principal Step-Up: Principal increases to $4 million (U.S.) if unpaid after the third anniversary, and $5 million (U.S.) if unpaid after the fourth anniversary. No interest accrues on step-up amounts prior to their effective date.
  • Reversion Clause: If the note is not paid or other conditions are not met, Emergent has the ability to take the property back.
• Royalty Terms:
  • Emergent retains a 0.5% Net Smelter Return (NSR) royalty.
  • Fairchild has the option to buy out the royalty for $1 million (U.S.) prior to the fourth anniversary.
  • Fairchild has the option to buy out the royalty for $1.5 million (U.S.) if exercised between the fourth and seventh anniversaries.
  • Buyout rights expire after the seventh anniversary.
• Additional Obligations: Fairchild is required to finance an approximately $40,000 (U.S.) reclamation bond upon closing.
• Conditions: Transaction is subject to TSX Venture Exchange approval, regulatory approval, and satisfaction of conditions by both parties. No finders' fees are being paid.

Notable Quotes

• "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 will initially receive upfront cash and share payments. Emergent will then receive ongoing interest payments throughout the term of the note and the eventual payment of the note principal. There is further potential long-term upside from the royalty. The step-up of the note principal in years four and five acts as an incentive for the potential early payment of the note. The option of early repayment would benefit both companies. If the note is not paid or if other conditions of the transaction are not met, Emergent has the ability to take the property back." — David Watkinson, President and CEO of Emergent Metals Corp.