Mr. Errol Farr reports

LOYALIST ANNOUNCES CLOSING OF SHARES FOR DEBT TRANSACTION AND TERMINATION OF NON-BROKERED PRIVATE PLACEMENT

Loyalist Exploration Ltd. has terminated its previously announced non-brokered private placement and no further tranches or closings of the offering will be completed. As previously announced in the company's press release dated Aug. 31, 2026, the company closed the first tranche of the offering, consisting of the sale of 25 million common shares in the capital of the company at a price of four cents per common share for gross proceeds to the company of $1-million. The first tranche represents the final closing of the offering. The offering was originally announced in the company's press release dated Aug. 10, 2026.

The company is also pleased to announce the closing of a shares-for-debt transaction, pursuant to which the company settled an aggregate of $113,285 of outstanding indebtedness owing to certain creditors through the issuance of 2,832,125 common shares at a price of four cents per common share. All securities issued in connection with the shares-for-debt transaction are subject to a hold period expiring four months and one day after the date of issuance.

Errol Farr, president and chief executive officer of Loyalist, commented: "We are grateful for the support of our subscribers, which has enabled us to achieve our objective of funding the ongoing Tully PEA [preliminary economic assessment]. With this capital in place, we continue to execute on our strategy of becoming the next gold producer in the Timmins camp by systematically advancing Tully toward a fully funded and permitted mining operation."

The shares-for-debt transaction included the settlement of an aggregate of $45,000 of indebtedness owing to Mr. Farr, the president, chief executive officer and a director of the company, and Leonard Mackenzie, the vice-president of exploration of the company, through the issuance of an aggregate of 1,125,000 common shares. Mr. Farr and Mr. Mackenzie are each a related party of the company within the meaning of Multilateral Instrument 61-101, Protection of Minority Security Holders in Special Transactions, and, accordingly, the shares-for-debt transaction is a related party transaction for the purposes of MI 61-101. The company is relying on the exemptions from the formal valuation and minority approval requirements contained in Section 5.5(a) and Section 5.7(1)(a) of MI 61-101, respectively, on the basis that neither the fair market value of the subject matter of nor the fair market value of the consideration for the shares-for-debt transaction, insofar as it involves Mr. Farr and Mr. Mackenzie, exceeds 25 per cent of the company's market capitalization.

The proceeds from the first tranche will be used to complete continuing National Instrument 43-101 technical reports, including a resource estimate and preliminary economic assessment on the company's Tully project and continuing production permitting work at Tully, property payments and general working capital.

In connection with the first tranche, the company paid a finder's fee of $37,200 in cash to Haywood Securities Inc. and issued 930,000 non-transferable broker warrants to Haywood. Each broker warrant entitles Haywood to acquire one common share at an exercise price of 7.5 cents per common share until Aug. 31, 2028.

All of the securities issued in connection with the first tranche are subject to a hold period expiring four months and one day after the date of issuance.

About Loyalist Exploration Ltd.

Loyalist is a Canadian mineral exploration and development company focused on creating long-term shareholder value through the advancement of high-quality mineral projects in Timmins, Ont. The company's flagship, 100-per-cent-owned Tully gold project, located in the prolific Timmins gold camp of Northeastern Ontario, is a growing underground gold project with significant exploration upside and excellent development potential. Supported by a high-confidence indicated and inferred mineral resource estimate, favourable infrastructure, and a modern geological model, Tully provides a strong platform for continued development and expansion.

Loyalist's strategy is to systematically advance the Tully gold project to production while growing the deposit and continuing to evaluate opportunities to expand its portfolio of high-quality mineral assets.

The company also looks forward to advancing exploration activities on its three other Timmins-based projects -- DeSantis, Gold Rush and Loveland.

The company is committed to maintaining the highest standards of technical excellence and responsible development throughout all stages of project advancement.

We seek Safe Harbor.