Golden Shield Resources Inc. (CSE: GSRI) (OTCQB: GSRFF) (FRA: 4LE0)  is pleased to announce that it has entered into a non-binding letter of intent dated July 22, 2024 with Tucano Gold Inc. pursuant to which the Company will acquire of all the issued and outstanding securities of Tucano Gold in exchange for securities in the Company.

Golden Shield’s Executive Chairman, Leo Hathaway commented, “This transaction provides Golden Shield with continued exposure to the exploration upside at Marudi as well as Tucano Gold’s ability to crystallise the value of a near producing high grade gold asset in Brazil. Geologically, Marudi and Tucano Gold lie in the same poorly understood gold belt, and the resultant company will have a strong knowledge, operational and strategic advantage in making future discoveries”.

Tucano Gold’s CEO, Jeremy Gray adds, “We are very excited to join forces with Golden Shield and their strong technical team with intimate knowledge of the Guiana Gold Shield.  It’s a great fit with Tucano Gold’s production operations and large ~2,000 sq km highly prospective tenement block on the Shield. The combination will help unlock the exciting potential of Golden Shield’s exploration projects in Guyana and create a platform for future growth as Mina Tucano starts generating significant cash flow amidst a backdrop of record gold prices.”

The terms outlined in the LOI are preliminary and non-binding, and the Transaction is subject to, among other conditions, the parties successfully entering into a definitive agreement.

The proposed Transaction is expected to be structured as a reverse takeover to be effected by way of a statutory plan of arrangement, share exchange or amalgamation, or such other structure as the parties may agree upon.  Pursuant to the LOI, securities of Golden Shield will be consolidated on a ten for one basis and each shareholder of Tucano Gold will receive one common share of the Company in exchange for each common share of Tucano Gold held by such shareholder.  The foregoing exchange ratio implies a value of CDN$0.08 per Golden Shield Share and CDN$0.80 per Tucano Gold Share.  Assuming completion of the proposed Transaction, and before additional equity financing is completed, the shareholders of Golden Shield and Tucano Gold would own approximately 12.9% and 87.1% of the common shares of the Company respectively, and the Company is expected to have approximately 55 million shares issued and outstanding based on the current capital structure of the Company and Tucano Gold.

The composition of the board of directors the Company, as well as the retention of certain key employees and consultants, will be negotiated between the parties in good faith.  The parties will use commercially reasonable efforts to negotiate and finalize the Definitive Agreement within 60 days following the date of the LOI.  To facilitate this process, Golden Shield and Tucano Gold have agreed to negotiate exclusively for a period of 60 days following the date of the LOI and to complete due diligence and negotiate and enter into a Definitive Agreement.

The LOI also contemplates other material conditions precedent to the closing of the Transaction, including customary due diligence, the negotiation and signing of a Definitive Agreement, receipt of all necessary regulatory, Canadian Securities Exchange, corporate and third-party approvals, and all requisite board and shareholder approvals being obtained. No finders’ fees are payable in connection with the Transaction.

If completed, the Transaction will constitute a “fundamental change” pursuant to the policies of the CSE. However, there can be no assurance that the Transaction will be completed as proposed or at all.

The Company intends to issue a comprehensive news release in connection with the Transaction upon entering into the Definitive Agreement.

None of the Golden Shield Shares to be issued in connection with the Transaction have been, or will be, registered under the United States Securities Act of 1933, as amended (the “1933 Act“), or any state securities laws, and may not be offered or sold within the United States or to any U.S. Person (as defined in Regulation S under the 1933 Act) unless registered under the 1933 Act and applicable state securities laws or an exemption from such registration is available. This news release does not constitute an offer to sell or a solicitation of an offer to sell any securities of Golden Shield in any jurisdiction where such offer or solicitation would be unlawful, including the United States.

Investors are cautioned that, except as disclosed in the disclosure documents to be prepared in connection with the Transaction, any information released or received with respect to the transaction may not be accurate or complete and should not be relied upon. Trading in the securities of the Company should be considered highly speculative.

About Golden Shield Resources Inc.

Golden Shield Resources Inc. is a Canadian company that owns the 5,457-hectare, Marudi Mountain gold project located in the Rupununi District of southwestern Guyana (the “Marudi”). The Marudi property covers a high-grade gold camp on which a total of 50,350m of diamond drilling has been carried out, with Mazoa Hill representing the principal deposit where most of the drilling has occurred. Numerous other deposits occur on the property that require additional drilling, including Pancake Creek, Marudi North, Toucan and others.

About Tucano Gold Inc.

Tucano Gold Inc. is a Canadian company that owns the large-scale gold mining operation, Mina Tucano, in the state of Amapá, Brazil. Mina Tucano is an open pit operation with under-ground development potential, fully equipped with state-of-the-art infrastructure and ability to process up to 3.5 million tonnes of ore per year. The project is currently on care and maintenance with a planned production re-start Q4 2024.