Western Star Resources Inc. press release
Hochschild's Tiernan Gold and Railtown Capital Announce up to $65M Private Placement Equity Financing and Execution of Definitive Agreement for Proposed Qualifying Transaction
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Highlights
Definitive Agreement entered into for proposed "Qualifying Transaction" that is expected to result in a reverse-takeover of Railtown by Tiernan with the Resulting Issuer trading on the TSX Venture Exchange as "Tiernan Gold Corp." Up to CAD$65 million best-efforts private placement equity raise with a 15% Agents' Option through a syndicate of agents to be co-led by Canaccord Genuity and BMO Capital Markets and including Raymond James and Haywood Securities. Jill Gardiner and incoming Chief Executive Officer, Fausto Di Trapani , to join previously named directors ( Chris Taylor , Greg McCunn , Claudia Tornquist , Eduardo Noriega and Nicolas Hochschild ) to make up the board of directors of the Resulting Issuer, with Jill Gardiner to serve as the Chair.
VANCOUVER, BC , Oct. 6, 2025 /CNW/ - Tiernan Gold Corp. (" Tiernan "), a wholly owned subsidiary of Hochschild Mining PLC (" Hochschild ") (LSE: HOC)(OTCQX: HCHDF) and Railtown Capital Corp. (" Railtown ") (TSXV: RLT.P) are pleased to announce that, further to the proposed qualifying transaction announced in their joint press release dated September 3, 2025 , they, together with 1559261 B .C. Ltd. (" Subco "), a wholly owned subsidiary of Railtown, have entered into a definitive business combination agreement dated October 6, 2025 (the " Definitive Agreement "), which sets out the terms and conditions of a three-cornered amalgamation that will result in Railtown acquiring all of the issued and outstanding common shares of Tiernan (the " Tiernan Shares ") in exchange for common shares of Railtown and will result in a reverse-takeover of Railtown by Tiernan (the " Proposed Transaction " or " RTO "). All dollar figures in this release are Canadian dollars unless otherwise stated.
It is anticipated that the Proposed Transaction will constitute the "Qualifying Transaction" (as such term is defined in Policy 2.4 – _Capital Pool Companies _of the Corporate Finance Manual of the TSX Venture Exchange (the " TSXV ")) of Railtown and, upon completion of the Proposed Transaction, the entity resulting from the Proposed Transaction (the " Resulting Issuer ") will meet the initial listing requirements of the TSXV as a "Tier 1" company in the mining industry and the business of Tiernan of advancing the large-scale open-pit heap leach Volcan gold project located in the Maricunga Region of Chile (the " Volcan Project " or the " Project ") will become the business of the Resulting Issuer.
Tiernan and Railtown are also pleased to announce that Tiernan has entered into an engagement letter dated October 6, 2025 with Canaccord Genuity Corp. (" Canaccord ") whereby Canaccord has agreed to act as co-lead agent on its own behalf and on behalf of BMO Capital Markets and a syndicate of agents including Raymond James Ltd. and Haywood Securities Inc. (collectively, the " Agents ") with respect to a proposed brokered best-efforts private placement (the " Financing ") of subscription receipts of Tiernan (the " Tiernan Subscription Receipts "). The Financing is expected to be completed in connection with the Proposed Transaction.
Terms of Subscription Receipt Financing
Pursuant to the Financing, up to 8,666,667 Tiernan Subscription Receipts are proposed to be issued to new investors, subject to increase if the Agents' Option (as defined below) is exercised, at a price of $7.50 per Tiernan Subscription Receipt (the " Issue Price ") for aggregate gross proceeds of up to $65,000,000 (inclusive of proceeds of up to $35,000,000 from a treasury issuance by Tiernan and up to $30,000,000 from the secondary sale of Tiernan Shares owned by Hochschild). Upon the satisfaction or waiver of the Escrow Release Conditions (as defined below) before the Escrow Deadline (as defined below), each Tiernan Subscription Receipt shall be automatically exchanged, for no further consideration and with no further action on the part of the holder thereof, for one Tiernan Share immediately prior to completion of the Proposed Transaction. The Tiernan Shares will consist of 4,666,667 shares issued by Tiernan from treasury and up to 4,000,000 shares from Hochschild. The issuance will be subject to customary anti-dilution provisions, upon the delivery by Tiernan and Canaccord (for and on behalf of the Agents) to a subscription receipt and escrow agent to be appointed for the Financing (the " Escrow Agent ") of an escrow release notice confirming the satisfaction of certain conditions (the " Escrow Release Conditions "), provided such Escrow Release Conditions have been satisfied on or before 90 days following closing of the Financing (the " Escrow Deadline "). It is expected that the Escrow Release Conditions will include, among other things, that all conditions precedent to closing of the Proposed Transaction will have been satisfied or waived, including all necessary regulatory approvals (including approval of the TSXV).
Tiernan has granted the Agents an option (the " Agents' Option ") to sell up to an additional 1,300,000 Tiernan Subscription Receipts at the Issue Price for additional aggregate gross proceeds of up to $9,750,000 on the same terms and conditions as the Financing. The Agents' Option shall be exercisable, in whole or in part, up to 48 hours prior to closing of the Financing (the date of such closing, referred to herein as the " Closing Date "). Funds raised from the Agents' Option are expected to be used to further reduce the number of Tiernan Shares owned by Hochschild
As part of the Proposed Transaction, it is anticipated that Railtown will complete a consolidation of its common shares prior to completion of the Proposed Transaction (the " Railtown Consolidation ") on a 0.2820212:1 consolidation ratio. The Railtown Consolidation is subject to applicable regulatory approvals, including approval of the TSXV. Assuming completion of the Railtown Consolidation, upon closing of the Proposed Transaction, each Tiernan Share will be exchanged for one common share of the Resulting Issuer from the Proposed Transaction.
Based on the above terms, the Resulting Issuer will have an ownership structure of 67.2% Hochschild, 13.4% current Railtown shareholders and 19.4% new investors under the Financing (without exercise of the Agents' Option). In the event that the Agents' Option is fully exercised, the Resulting Issuer will have an ownership structure of 64.3% Hochschild, 13.4% current Railtown shareholders and 22.3% new investors.
In connection with the Financing, the Agents will be entitled to receive, upon satisfaction of the Escrow Release Conditions prior to the Escrow Deadline, a cash commission equal to six percent (6%) of the gross proceeds from the Financing.
On the Closing Date, the gross proceeds from the Financing, less the Agents' expenses (the " Escrowed Funds "), will be deposited in trust with the Escrow Agent. In the event that the Escrow Release Conditions are not satisfied on or before the Escrow Deadline, the Escrowed Funds, together with the accrued interest thereon, will be returned to holders of the Tiernan Subscription Receipts and the Tiernan Subscription Receipts will be cancelled. If the Escrow Release Conditions are satisfied on or before the Escrow Deadline, the Escrowed Funds attributable to the treasury portion of the Offering will be released and used to fund the business of the Resulting Issuer, including to advance the Volcan Project, settle any existing accounts payable and for general corporate purposes and the Escrowed Funds attributable to the secondary sale by Hochschild will be released to Hochschild.
Update Relating to Board of Directors of the Resulting Issuer
Upon closing the Proposed Transaction, the management and board of directors of the Resulting Issuer shall be reconstituted to lead the development of the Volcan Project. As previously announced, the board of directors will consist of Chris Taylor , Greg McCunn , Claudia Tornquist , Eduardo Noriega , Nicolas Hochschild and two additional directors to be determined (including the Chair). The two additional directors will be Fausto di Trapani (who will also be serving as Chief Executive Officer) and Jill Gardiner (to serve as the Chair). Railtown intends to hold an annual general and special meeting of shareholders (the " Railtown AGSM ") on November 12, 2025 to obtain shareholder approval for, among other things, the appointment of new directors of Railtown contingent upon completion of the Proposed Transaction. See " _Annual General and Special Meeting of Railtown _" below.
Jill Gardiner – Chair of the Board of Directors
Jill Gardiner has extensive corporate governance experience after having served on public companies and not-for-profit boards in leadership roles since 2003. Ms. Gardiner spent over 20 years in the investment banking industry in various roles in corporate finance, mergers and acquisitions, and debt capital markets in which she provided strategic advice to, and helped raise capital for, numerous corporations with a focus on the power, pipeline, infrastructure, and commodity industries. In addition to Tiernan Gold , Ms. Gardiner is currently a member of the board of directors of Hochschild Mining and Chair of the board of directors of Capital Power. Previously she served on the boards of Timber Investments, Parkbridge Lifestyle Communities, SilverBirch Hotels, Turquoise Hill Resources (Chair), Capstone Mining, and Trevali Mining (Chair). She holds a Bachelor of Science and a Master of Business Administration, both from Queen's University.
Terms of the Definitive Agreement
The Definitive Agreement contemplates that, among other things, the following conditions precedent be met prior to the closing of the Proposed Transaction: (a) receipt of all required consents, waivers, permits, exemptions, orders and approvals required to permit the completion of the Proposed Transaction; (b) receipt of TSXV approval in respect of the Proposed Transaction, the listing of post-Railtown Consolidation common shares of Railtown (" Railtown Shares ") and Railtown Shares issued pursuant to the Proposed Transaction; (c) receipt of all corporate approvals, including certain approvals from the board of directors of each of Tiernan and Railtown and the shareholders of Tiernan and Railtown, as necessary; (d) the distribution of all securities contemplated by the Definitive Agreement shall be exempt from the prospectus and registration requirements of Canadian securities laws; (e) no law is in effect, or governmental action or legal proceeding is pending, that makes the consummation of the Proposed Transaction illegal or materially delays or prevents the consummation of the Proposed Transaction; (f) no cease trade order or similar restraining order of any provincial securities administrator relating to the securities contemplated by the Definitive Agreement shall be in effect; (g) no material adverse effect in respect of Railtown or Tiernan shall have occurred since the date of the Definitive Agreement; (h) the Investor Rights Agreement (as such term is defined below) shall have been entered into between Railtown and Hochschild Mining Holdings Ltd., a subsidiary of Hochschild (" HM Holdings "); (i) the Railtown Consolidation (as such term is defined below) shall have occurred; (j) the consolidation of the Tiernan Shares on the basis of one post-consolidation common share for every 0.342 pre-consolidation common share shall have been completed (such that the resulting common shares outstanding in Tiernan are 34,000,000); (k) the Financing shall have been completed for aggregate gross proceeds sufficient to satisfy minimum listing requirement of the TSXV for a Tier 1 mining issuer; and (l) the technical report and title opinion relating to the Volcan Project shall have been delivered by Tiernan.
The Proposed Transaction will not constitute a "Non-Arm's Length Qualifying Transaction" (as such term is defined in the policies of the TSXV) and, as such, Railtown shareholder approval is not required to approve the Proposed Transaction (unless otherwise mandated by the TSXV). No person who or which is a "Non-Arm's Length Party" (as such term is defined in the policies of the TSXV) of Railtown has any direct or indirect beneficial interest in Tiernan or its assets prior to giving effect to the Proposed Transaction and no such person is an insider of Tiernan. Similarly, there is no known relationship between or among any person who or which is a Non-Arm's Length Party of Railtown and any person who or which is a Non-Arm's Length Party of Tiernan. Although no Railtown shareholder approval is required to approve the Proposed Transaction, Railtown intends to hold the Railtown AGSM on November 12, 2025 at which it will request shareholder approval for certain matters related to the Proposed Transaction. See " _Annual General and Special Meeting of Railtown _" below.
If all conditions to the implementation of the Proposed Transaction have been satisfied or waived, Railtown and Tiernan will carry out the Proposed Transaction such that: (a) Tiernan and Subco will amalgamate under the _Business Corporations Act _( British Columbia ) (" BCBCA ") (the " First Amalgamation ") to form a new company (" Amalco "); and (b) immediately thereafter, Railtown and Amalco will vertically amalgamate under the BCBCA (the " Second Amalgamation ") to form the Resulting Issuer.
Pursuant to the terms of the Definitive Agreement, it is expected that the following security conversions and issuances will occur in connection with the First Amalgamation:
(a) the Tiernan Subscription Receipts shall be automatically converted into Tiernan Shares in accordance with their terms immediately prior to effecting the First Amalgamation; and
(b) concurrently with receipt of the certificate of amalgamation issued by the Registrar of Companies under the BCBCA evidencing that the First Amalgamation is effective:
(i) each issued and outstanding common share of Subco (each, a " Subco Share "), all of which are held by Railtown, will be exchanged for one issued and fully paid common share of Amalco (an " Amalco Share ") and the Subco Shares shall be cancelled;
(ii) each issued and outstanding Tiernan Share will be exchanged for one issued and fully paid Railtown Share and the Tiernan Shares shall be cancelled (with 34,000,000 Railtown Shares expected to be issued by Railtown to current Tiernan shareholders, which, based on the deemed price of $1.60 per Railtown Share, would represent an aggregate consideration value of $54,251,250 );
(iii) in consideration of the issuance by Railtown of Railtown Shares in connection with the First Amalgamation, Amalco shall issue to Railtown one fully paid and non-assessable Amalco Share for each Railtown Share issued to former holders of Tiernan Shares;
(iv) Amalco shall add an amount to the capital maintained in respect of the Amalco Shares equal to the sum of the capital of the: (A) Tiernan Shares, determined immediately prior to effecting the First Amalgamation; and (B) Subco Shares, determined immediately prior to effecting the First Amalgamation; and
(v) Railtown shall add an amount to the capital maintained in respect of the Railtown Shares equal to the capital of the Tiernan Shares, determined immediately prior to effecting the First Amalgamation.
Upon receipt of the certificate of amalgamation issued by the Registrar of Companies under the BCBCA evidencing that the Second Amalgamation is effective, all Amalco Shares shall be cancelled without any repayment of capital in respect thereof and the post-Consolidation Railtown Shares will be the common shares of the Resulting Issuer (the " Resulting Issuer Shares ").
In connection with the Proposed Transaction (and without giving effect to the Financing), it is anticipated that an aggregate of 40,000,000 Resulting Issuer Shares will be issued and outstanding on a fully diluted basis and that: (a) the current Railtown shareholders will hold 6,000,000 Resulting Issuer Shares (including options and warrants), representing approximately 15% of the outstanding Resulting Issuer Shares; and (b) the current Tiernan shareholders will hold 34,000,000 Resulting Issuer Shares, representing approximately 85% of the outstanding Resulting Issuer Shares.
In connection with the Proposed Transaction, Railtown shall enter into an investor rights agreement with HM Holdings (the " Investor Rights Agreement ") with respect to, among others, certain director nomination rights, pre-emptive rights, top-up rights, registration rights, governance matters and shareholder rights contained therein. A copy of the form of Investor Rights Agreement is appended to the Definitive Agreement.
Financial Information Relating to Tiernan
The following table sets out selected unaudited financial information with respect to Tiernan as at June 30, 2025 , and December 31, 2024 . Such unaudited financial information has been prepared in accordance with International Financial Reporting Standards, issued by the International Accounting Standards Board, and are denominated in U.S. dollars.
| (Expressed in thousands of U.S. dollars) | Tiernan Gold Corp. | | | | | | | | As at June 30, 2025 US$ '000 | As at December 31, 2024 US$ '000 | | Current Assets | 11,103 | 11,942 | | Non-current Assets | 72,032 | 35,420 | | Total Assets | 83,135 | 47,362 | | Current Liabilities | 1,387 | 990 | | Total Liabilities | 1,387 | 990 | | Shareholders' Equity | 81,748 | 46,372 | | Net Income | 31,839 | 168 |
The audited annual financial statements (as at December 31, 2024 ) and unaudited interim financial statements (as at June 30, 2025 ) of Tiernan will be available in the filing statement of Railtown in respect of the Proposed Transaction (the " Railtown Filing Statement ") to be filed in due course.
Additional Information
For additional information relating to the terms of the Proposed Transaction, please refer to a copy of the Business Combination Agreement as well as the joint news release dated September 3, 2025 , which is available on SEDAR+ ( www.sedarplus.ca ) )under the Company's issuer profile. In addition, more information relating to the Proposed Transaction and the Resulting Issuer will be available in the Railtown Filing Statement to be filed in due course on SEDAR+ ( www.sedarplus.ca ) )under the Company's issuer profile.
Annual General and Special Meeting of Railtown
Railtown intends to hold the AGSM on November 12, 2025 . At the AGSM, Railtown will request shareholder approval for, among other things, the appointment of new directors of Railtown contingent upon completion of the Proposed Transaction and the adoption of a new long-term incentive plan of Railtown for its directors, officers, employees and consultants.
Cautionary Statements
Completion of the Proposed Transaction is subject to a number of conditions, including but not limited to, TSXV acceptance and, if applicable pursuant to TSXV requirements, shareholder approval. Where applicable, the Proposed Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Proposed Transaction will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the Proposed Transaction, any information released or received with respect to the Proposed Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.
The TSXV has in no way passed upon the merits of the Proposed Transaction and has neither approved nor disapproved the contents of this news release.
On behalf of Tiernan Gold Corp. Greg McCunn , CEO and Director
On behalf of Railtown Capital Corp . Chris Taylor , CEO and Director
About Tiernan Gold Corp.
Tiernan Gold Corp. is a corporation formed under the laws of the Province of British Columbia and a wholly-owned indirect subsidiary of Hochschild Mining PLC (LSE:HOC)(OTCQX:HCHDF), a public company existing under the laws of England and Wales . Tiernan is focused on the disciplined de-risking of the Volcan Project. The Project is strategically located in the Atacama Region of Chile , on the Maricunga gold belt, a jurisdiction that has a long-established history of mining with a number of operating mines, new mines under construction and major projects being developed.