Star Royalties Closes Second Installment of US$6 Million of US$18 Million Ongoing Funding for Copperstone Gold Mine Restart


February 24, 2021 – TheNewswire – Toronto, ON – Star Royalties Ltd. (there “Company” or “Star royalties”) (TSXV:STRR) is pleased to announce the closing of the second installment of its previously announced US$18,000,000 gold purchase and sale agreement (the “Broadcast agreement“) with Arizona Gold Corp. (“Arizona Gold”) (TSX: AZG, OTC: AGAUF) (formerly Kerr Mines Inc.) which will fund the restart of underground operations and gold production at the Copperstone Gold Mine.Copper”) in Arizona, USA.

Alex Pernin, Managing Director of Star Royalties, said: “With the closing of Tranche 2 and an operational restart expected in less than a year, this gold flow represents a significant short-term cash flow from a Very promising deposit in a world-class skill. We have great confidence in Copperstone’s potential and Arizona Gold’s ability to execute a successful restart of operations. We look forward to working closely with their team as we transition Copperstone to Arizona’s next producing gold mine. »

The US$18 million advance payment under the broadcast agreement is being made in three equal installments, with the first two installments of US$6 million having now been advanced. The final installment of US$6 million will be payable no later than April 30, 2021, subject to certain closing conditions.

Summary of trading conditions

  • Star Royalties will purchase from Arizona Gold an amount of refined gold equal to 9.9% of the gold produced at Copperstone until delivery of 21,000 ounces of refined gold, then 3.3% of the gold produced until upon delivery of 27,200 ounces, and 1.2% of gold produced thereafter over the remaining life of mine.

  • In addition to the US$18 million prepayment, Star Royalties will provide a cash payment to Arizona Gold for each ounce of gold delivered equal to 25% of the average London Bullion Market gold spot price (PM) Association for the five consecutive trading days preceding deliver. Arizona Gold has granted a security interest in all of its assets to the Company to secure Arizona Gold’s obligations to the Company under the Broadcast Agreement.

  • As part of the second tranche advance of US$6 million, Arizona Gold entered into an amended and restated royalty purchase agreement with Trans Oceanic Mineral Company Ltd. (“TOMCL”) providing for the purchase of a 3% gross production royalty on Copperstone for US$2.5 million. Once completed, the purchase will reduce the aggregate gross royalty on Copperstone from 6% to 3%, consisting of a remaining 1.5% royalty which will continue to be held by TOMCL and a 1.5% royalty owned by Angie Patch Survivor’s Trust. Completion of the buyout is subject to satisfaction of all conditions of Star Royalties’ advance of the third installment of US$6 million under the broadcast agreement.

CONTACT INFORMATION

For more information, please visit our website at www.starroyalties.com or contact:

Alex Pernin, geo.

Chairman and Chief Executive Officer and Director

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Pierre-Bures

Business Development Director

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+1 647 360 4793 +1 437 997 8088

ABOUT STAR ROYALTIES LTD.

Star Royalties Ltd. is a streaming royalty and investment company in precious metals. The company’s goal is to create wealth through accretive transaction structuring and asset life extension with superior alignment to counterparties and shareholders. With a strategy also to invest in green opportunities, Star Royalties launched the first forest carbon credit royalty and is pursuing a pipeline of additional green investments.

CAUTION REGARDING FORWARD-LOOKING INFORMATION

Certain statements in this press release may constitute “forward-looking statements”, including those regarding future metals and minerals market conditions. Forward-looking statements are statements that address or discuss activities, events or developments that the Company expects or anticipates may occur in the future. When used in this press release, words such as “estimates”, “expects”, “plans”, “anticipates”, “will”, “believes”, “intends”, “should”, “could”, “may” and similar terminology is intended to identify such forward-looking statements. Forward-looking statements are made based on certain assumptions and other important factors which, if incorrect, could cause Star Royalties’ actual results, performance or achievements to be materially different from future results, performance or achievements. expressed or implied by these statements. Forward-looking statements should not be construed as a guarantee of future performance or results and will not necessarily be an accurate indication of whether or not such results will be achieved. A number of factors could cause actual results, performance or achievements to differ materially from these forward-looking statements, including, without limitation, changes in business plans and strategies, market conditions , the share price, the best use of available cash, the Company’s ability to identify and execute future acquisitions on acceptable terms or not at all, the risks inherent in royalty companies, title issues and permits, volatility of metals and minerals prices, variances between actual and estimated production, mineral reserves and resources and metallurgical recoveries, mining and development risks related to the parties that produce the metals and minerals that Star Royalties will purchase or receive royalties from, regulatory restrictions, activities of governmental authorities (including including changes in taxation), currency fluctuations, global social and economic climate, global disasters and pandemics, dilution and ion competition. These and other risks could cause actual results and events to vary materially. Accordingly, readers should exercise caution when relying on forward-looking statements, and the Company undertakes no obligation to revise them publicly to reflect subsequent events or circumstances, except as required by law.


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