Liberty Gold to sell Goldstrike project to Heliostar

Executive Summary

• Liberty Gold Corp. has entered into a definitive share purchase agreement to sell its subsidiary, Speciality American Metals Inc., which owns the Goldstrike project in southern Utah, to Heliostar Metals Ltd.
• The total consideration for the transaction is $72.5 million (U.S.), structured as a mix of immediate cash, deferred cash payments, and equity in Heliostar.
• The transaction is expected to provide Liberty Gold with non-dilutive capital to advance its flagship Black Pine oxide gold project in southern Idaho.

Key Details

• Transaction Structure: Liberty Gold sells Speciality American Metals Inc. (owner of Goldstrike) to Heliostar Metals Ltd.
• Total Consideration: $72.5 million (U.S.).
• Payment Terms:
  • At Closing: $10 million (U.S.) in cash plus approximately 1.6 million Heliostar common shares (valued at approximately $2.5 million U.S.).
  • 12 Months Post-Closing: $10 million (U.S.) in cash.
  • 18 Months Post-Closing: $10 million (U.S.) in cash.
  • Earlier of Milestones or 5 Years: $15 million (U.S.) in cash upon achievement of certain infrastructure-related milestones or five years from closing.
  • Earlier of Feasibility/Construction or 5 Years: $25 million (U.S.) in cash upon release of a feasibility study, a construction decision, or five years from closing.
• Equity Hold Period: All Heliostar shares received as consideration are subject to a hold period under Canadian securities laws, expiring four months plus one day from closing.
• Strategic Rationale: The deal provides meaningful non-dilutive capital, strengthening Liberty Gold's balance sheet to fund the advancement of the Black Pine project (feasibility and permitting) while maintaining exposure to Goldstrike's value through Heliostar equity.
• Advisers:
  • Financial Advisers: Canaccord Genuity Corp. and 3L Capital Inc.
  • Legal Counsel: Blake, Cassels & Graydon LLP and Parsons Behle & Latimer.
• Fairness Opinion: Canaccord Genuity provided a fairness opinion stating the consideration is fair from a financial point of view to Liberty Gold.
• Approvals and Timing: Approved by Liberty Gold's Board of Directors. Closing is subject to TSX Venture Exchange regulatory approvals and customary conditions, expected within 30 days.

Notable Quotes

• "This transaction provides meaningful non-dilutive capital, with total consideration of $72.5-million (U.S.), strengthening our balance sheet at an important stage in the advancement of Black Pine," said Jon Gilligan, president and chief executive officer of Liberty Gold. "The structure delivers near-term funding while maintaining exposure to additional value as Goldstrike advances, supporting feasibility and long-lead procurement at Black Pine, without shareholder dilution. We are also very pleased to partner with Heliostar who have an experienced team that we believe is well positioned to advance Goldstrike toward development."