Mr. David DeWitt reports

FUSION GOLD ANNOUNCES TERMINATION OF DEFINITIVE AGREEMENT AND NEW LETTER AGREEMENT WITH BATTERY MINERALS

Fusion Gold Ltd. has terminated its previously announced binding scheme implementation agreement dated Oct. 11, 2019, with Battery Mineral Resources Ltd., an Australian incorporated entity, and a support agreement with Weston Energy LLC also dated Oct. 11, 2019, and, as a result, has received an expense reimbursement fee of $150,000.

The definitive agreement was terminated as a result of Battery Ltd. commencing a voluntary administration process under the Corporations Act, 2001 (Cth) (Australia). The assets of Battery Ltd. have now been acquired by Battery Mineral Resources Corp. (New Battery), a new entity incorporated under the laws of British Columbia by Weston. Further to the termination of the definitive agreement, New Battery, Weston and Fusion have entered into a new letter agreement dated Dec. 5, 2019, in respect of a transaction substantially similar to that contemplated by the definitive agreement.

New Battery will carry on the same business as that previously carried on by Battery Ltd., namely the exploration and development of cobalt prospects in Canada, as well as other minerals critical to the lithium-ion battery market and energy storage sector.

The letter agreement sets out the principal terms upon which Fusion will acquire all of the issued and outstanding securities of New Battery, which, although are substantially similar to those announced by news releases dated Sept. 3, 2019, and Oct. 11, 2019, are, for completeness, set forth in detail herein.

Fusion, after giving effect to the completion of the transaction, is referred to in this news release as the resulting issuer.

As previously disclosed, Fusion is a capital pool company that completed its initial public offering in September 2018. The common shares of Fusion are listed for trading on the TSX Venture Exchange under the stock symbol FML.P. It is intended that the transaction, when completed, will constitute the "qualifying transaction" of Fusion for the purposes of TSX-V Policy 2.4 -- Capital Pool Companies.

On closing of the transaction, Fusion will change its name to Battery Mineral Resources Inc., or such other similar name as New Battery may direct and which is acceptable to the exchange and other applicable regulatory authorities.

From and upon completion of the transaction, the common shares of the resulting issuer will be listed under the trading symbol BMR. Fusion and New Battery anticipate that, on closing of the transaction, the resulting issuer will meet the TSX-V's initial listing requirements for a Tier 1 or Tier 2 mining issuer.

The letter agreement was negotiated at arm's length. The terms and conditions outlined in the letter agreement are binding on the parties, and the letter agreement is expected to be superseded by a definitive agreement to be negotiated between Fusion, Weston and New Battery and entered into on or before Dec. 19, 2019.

About New Battery

New Battery is a private company incorporated under the laws of British Columbia for the purposes of acquiring the assets of Battery Ltd..

On or about Nov. 10, 2019, Battery Ltd. commenced a voluntary administration process under the Corporations Act, 2001 (Cth) (Australia). On or about Dec. 5, 2019, New Battery acquired the assets of Battery Ltd. by way of the transfer of the issued and outstanding securities of the Battery Ltd. subsidiaries, pursuant to the terms of a share sale agreement dated Dec. 2, 2019, among New Battery, Weston and Battery Ltd.

New Battery's principal property will be its Cobalt District project, a significant aggregation of mineral exploration rights in Ontario and Quebec comprising multiple target areas, with New Battery's focus being on the McAra and Gowganda prospects in Ontario, and the Fabre prospect in Quebec. With historical exploration in the district having been primarily focused on silver, it is believed that the Cobalt District project is underexplored for cobalt. New Battery intends to continue exploration and drilling activities at identified cobalt occurrences throughout the project area with the goal of defining additional mineral resources.

A technical report in respect of the Cobalt District project will be filed in connection with the transaction, which will include 2019 drilling results, and an update of the mineral resource estimate for the McAra prospect.

New Battery's head and registered office is located at 744 West Hastings St., suite 400, Vancouver, B.C., V6C 1A5.

About Weston

Weston is a limited liability company formed under the laws of Delaware as an investment platform to acquire energy and natural resources assets. Weston's outstanding voting securities are owned by Yorktown Partners LLC and other investors. Yorktown Partners LLC is a private equity investment group based in New York, which has deployed over $8-billion (U.S.) in energy related investments over the past 23 years. Weston currently holds all of the common shares of New Battery.

Following its exchange of New Battery shares for resulting issuer shares upon completion of the transaction and completion of the concurrent financing (as described herein) and the purchase of Fusion shares under the share purchase agreements (as described below), Weston is expected to be a control person (as that term is defined under TSX-V policies) of the resulting issuer as it will own more than 20 per cent of the resulting issuer shares then outstanding.

Structure of the transaction

Fusion and New Battery currently intend to effect the transaction by way of a direct share exchange, pursuant to which Fusion will acquire all of the issued and outstanding securities of New Battery from the New Battery security holders in consideration for securities of Fusion, and New Battery will become a wholly-owned subsidiary of Fusion. Fusion and New Battery have agreed to cooperate with each other in structuring the transaction in an efficient manner and the final transaction structure may differ from that presented above following receipt of final tax, securities, corporate law and other advice.

The parties will negotiate in good faith to enter into a more detailed and definitive share exchange among each of the New Battery shareholders, Weston, Fusion and New Battery in respect of the transaction. The new definitive agreement will include customary terms and conditions (including representations and warranties regarding the shares and Assets, covenants, conditions, and other provisions consistent with this agreement) for a transaction of the nature of the transaction and will include: (i) a covenant by each of Fusion, Weston and New Battery not to complete the transaction unless the transactions contemplated by the share purchase agreements (as defined herein) have been completed or will be completed concurrently with the completion of the transaction; and (ii) a guarantee by Weston of the obligations of New Battery.

The parties agreed to use commercially reasonable efforts to enter into the New definitive agreement on or before Dec. 19, 2019.

Terms of the transaction

In connection with the transaction, Fusion intends to consolidate its common shares on a one-new-for-two-old basis.

Completion of the transaction is subject to the satisfaction of certain conditions, including but not limited to: (i) receipt of all requisite regulatory approvals, orders, notices and consents to implement the transaction including those of the exchange; (ii) completion of the concurrent financing; and (iii) Fusion having affected the name change referred to above and the consolidation.

Each of Fusion, Weston and New Battery has agreed to not, directly or indirectly, make, solicit, initiate, discuss, entertain, encourage, promote or facilitate any alternative transactions or enter into any agreement, arrangement or understanding related to any proposal with respect to any alternative transaction.

Subject to satisfaction or waiver of the conditions to the transaction, Fusion and New Battery anticipate that the transaction will be completed on or before March 15, 2020.

Each of Fusion and New Battery will bear its own costs in respect of the proposed transaction, except that New Battery will pay all regulatory fees including those related to sponsorship, if applicable.

In the event the transaction is not consummated for any reason other than as a result of Fusion exercising its right to terminate the letter agreement as a result of its due diligence review of New Battery, or the failure of Fusion to fulfill a material condition or obligation under the letter agreement or the New definitive agreement, New Battery has agreed to pay, or cause to be paid, to Fusion, $150,000, as an expense reimbursement.

Share purchase agreements

Concurrently with execution and delivery of the New definitive agreement, Weston will enter into share purchase agreements with David DeWitt and January Vandale. Under the share purchase agreements, the Fusion vendors will agree to sell and transfer to Weston, concurrently with the completion of the transaction, an aggregate of 3.2 million outstanding common shares of Fusion (prior to giving effect to the consolidation) at a price of eight cents per share. Those shares are currently held in escrow pursuant to an escrow agreement, dated June 19, 2018, among Fusion, the Fusion vendors and Odyssey Trust Company of Canada, as escrow agent.

Concurrent financing

In connection with the transaction, New Battery proposes to complete a best efforts private placement of: (i) flow-through common shares of New Battery; and (ii) common shares of New Battery, in each case, at a price to be determined in the context of market conditions, but to, collectively, raise gross proceeds of at least $5-million. shares issued under the private placement which shall be immediately exchanged for one postconsolidation common share of Fusion upon closing of the transaction.

The net proceeds of the concurrent financing will be used by the resulting issuer for continued mineral exploration activities across its mineral properties, including drilling and resource development and general operating expenses. Finders' fees or commissions in cash or securities may be paid in connection with the concurrent financing.

The resulting issuer

Subject to finalization of the terms of the concurrent financing, after giving effect to the (i) consolidation, (ii) the concurrent financing; and (iii) the issuance of common shares to Weston and others in connection with the organization of New Battery (including the acquisition of the assets), it is anticipated that there will be an aggregate of approximately 100 million shares issued in the resulting issuer.

Directors, management and insiders

Upon completion of the transaction, it is expected that the management of the resulting issuer will consist of Lazaros Nikeas, Ronald Phillips, Jack Cartmel, Peter Doyle and Dr. Henry Sandri. It is anticipated that the board of directors of the resulting issuer will consist of Mr. Nikeas, Dr. Stephen Dunmead, John Kiernan and one additional New Battery nominee. All directors and officers of Fusion will resign at the closing of the transaction.

The individuals listed herein are expected to be directors or senior officers of the resulting issuer.

Lazaros Nikeas, chief executive officer and director

Mr. Nikeas is the current chief executive officer of New Battery and was appointed to the board of directors of New Battery on Dec. 2, 2019. He is currently a principal investment manager for Weston, a portfolio company of New York private equity group, Yorktown Partners LLC. Prior to this, he was a Partner of Traxys Capital Partners, a private equity vehicle focused on mining, chemicals and industrial investments in partnership with The Carlyle Group. Before moving into private equity, he served as the head of corporate finance advisory for materials, mining and chemicals for North America at BNP Paribas for five years. Other investment banking roles included partner in mergers and acquisitions advisory at Hill Street Capital for eight years and as a corporate finance analyst at Morgan Stanley, where he began his career. Altogether, he has advised on over $25-billion (U.S.) of mergers and acquisitions transactions. Mr. Nikeas holds a bachelor of arts from Amherst College in Massachusetts, United States.

Ronald Phillips, vice-president, business development

Mr. Phillips is currently a principal at Weston. Mr. Phillips has 20 plus years of experience investing in energy and materials, including as the fund manager for the $600-million (U.S.) DKR Capital Event Driven Fund between 2002 and 2008. Prior to his role at DKR, Mr. Phillips co-managed the Weiss, Peck & Greer Merger Arbitrage Fund and he was a vice-president at ING Barings Furman Selz.

After attaining his bachelor's degree from Brown University and his JD from Stanford Law School, Mr. Phillips served as a captain in the U.S. Army Judge Advocate's General Corp., primarily serving at the Pentagon as an assistant to the U.S. Department of Defense General Counsel, and spent two years at Wachtell, Lipton, Rosen & Katz as an Antitrust Associate.

Jack Cartmel, chief financial officer

Mr. Cartmel is the current chief financial officer of New Battery. Mr. Cartmel is a chartered professional accountant with over 15 years of experience in the mining industry, as well as extensive experience in mergers and acquisitions, public and prospectus offerings, public company accounting and disclosure, as well as financial and risk management. Mr. Cartmel was also a senior manager of financial reporting and internal audit for Monument Mining Ltd., a mid-size gold producer in Asia listed on the Toronto Stock Exchange. He has also worked as manager of finance for White Tiger Gold Limited (formerly Century Mining Corp.), a mid-sized gold producer. Mr. Cartmel obtained a bachelor of business administration degree from Capilano University.

Peter Doyle, vice-president, exploration

Mr. Doyle is the current vice-president, exploration, of New Battery. He is a geologist with 40 years of experience in all aspects of mineral exploration, from regional reconnaissance to project evaluation and development. He has a successful track record in discovery and assessment of numerous mineral deposits in a variety of geological terrains throughout Canada, the United States, South America, Asia and Australia. Mr. Doyle was previously vice-president of exploration and business development at Troy Resources Ltd. Prior to joining Troy Resources in 2005, Mr. Doyle was regional geologist with Gold Fields Australasia Pty. Ltd., responsible for project generation, property assessments and exploration management in Australia, China, Mongolia, Papua New Guinea, the Philippines and the Australasian region. Mr. Doyle was involved in the identification, motivation and completion of acquisition of Western Mining Corp. Ltd.'s gold assets (St. Ives and Agnew) by Gold Fields Australasia and played a key role in Gold Fields Australasia's participation in Sino Gold Ltd., Zijin Mining Group Co. Ltd. and Avoca Resources Ltd.'s strategic equity financings. Between 1992 and 1995, Mr. Doyle was project manager for P.T. Freeport Indonesia Company, supervising the regional exploration in the Central Highlands of Irian Jaya that resulted in the delineation of the Wabu gold deposit.

Mr. Doyle holds a Bachelor of Science (Hons) degree in Geology from Laurentian University in Sudbury, Ont., Canada. Mr. Doyle is a fellow of the Australasian Institute of Mining and Metallurgy as well as a member of the Canadian Institute of Mining and Metallurgy, Society of Economic Geologists, Geological Association of Australia, Prospectors and Developers Association of Canada, and the Geological Association of Canada.

Henry Sandri, vice-president of technical development

Dr. Sandri is a technical adviser of New Battery. Dr. Sandri is a mineral economist and a seasoned executive in the mineral resource industry, with over 35 years of experience in finance, planning, business development, and executive management. He has worked with cobalt, copper, nickel and related metals on six continents over the past three decades. Dr. Sandri is the former vice-president of Inco Ltd. as well as president and chief operations officer of Duluth Metals Ltd. In addition, Dr. Sandri has held senior management positions in management, finance, planning, and operations with Select Resources, Burlington Northern Inc., Inco Ltd. and Inco Exploration Technical Services, Behre Dolbear & Company and K&M Engineering and Consulting Corp.

His early career included positions at the World Bank, the American Iron & Steel Institute and Booz Allen & Hamilton Inc. He is a former adjunct professor of economics and finance at the Colorado School of Mines and an adjunct professor of energy resources and natural resource economics at the Virginia Polytechnic Institute and State University. Dr. Sandri obtained his bachelor of science degree in foreign service (international trade and transportation) from Georgetown University in 1974, a master of arts degree in applied economics from the American University in 1978 and a PhD in mineral economics from the Colorado School of Mines in 1991.

John Kiernan, director

Mr. Kiernan was appointed to the Battery board effective Dec. 5, 2019. He is a mining engineer with over 30 years of mine operating, engineering, consulting, corporate and finance experience, including a cumulative four years as an underground miner and operating foreman. Mr. Kiernan is currently chief operating officer of of Ascot Resources and prior to that, vice-president of project development at Magellan Minerals (acquired by Anfield Gold Corp), and a Director of Northern Superior Resources Inc. Previously, Mr. Kiernan was manager of project evaluation at QuadraFNX/KGHM International, mining analyst at PI Financial Corp. and vice-president of mining/mine manager at Roca Mines Inc. From 1987 to 2006, Mr. Kiernan held various senior engineering positions with Strathcona Mineral Services, Inco Ltd., Wardrop and MRDI/AMEC. Mr. Kiernan holds a BSc in mining engineering from Queen's University and an MBA from Laurentian University

Dr. Stephen Dunmead, director

Dr. Dunmead was appointed to the Battery board on Dec. 5, 2019. He is currently an industrial consultant, he is an independent director for Eden Innovations Ltd., a clean technology and nanomaterials company listed on the Australian Securities Exchange, and serves on the audit committee and compensation committee of New Battery. He is a senior global business executive with over 30 years of strong operational leadership experience in the advanced materials and specialty chemicals industries. Previously, he served as chief operating officer at SWM International, where he was responsible for over 3,000 employees across 20 sites of SWM's global operations in North America, South America, Europe and Asia, accounting for $800-million (U.S.) of revenue and $180-million (U.S.) in EBITDA (earnings before interest, taxes, depreciation and amortization). At SWM International, he led the business into the high-growth and high-margin filtration and medical sectors. Prior to SWM, Dr. Dunmead spent 15 years at OM Group (OMG), where he had responsibility for six businesses with more than 6,500 employees across 32 sites. During his time at OMG, he led their cobalt business for more than 10 years, was chairman of the board for OMG's joint venture in the Democratic Republic of the Congo for 10 years and was chairman of the Cobalt Development Institute (now the Cobalt Institute) for seven years.

Dr. Dunmead started his career as a research engineer at the Lawrence Livermore National Laboratory in California. He later joined the Dow Chemical Company, where he held a variety of research and business development positions. He has a PhD in materials science and engineering from the University of California at Davis, as well as a master of science degree and bachelor of science degree in ceramic engineering from Ohio State University.

Transaction negotiated at arm's length

The transaction will not constitute a non-arm's-length qualifying transaction (as such term is defined in the policies of the TSX-V). No person who or which is a non-arm's-length party of Fusion has any direct or indirect beneficial interest in New Battery or its assets (including the Cobalt District project) prior to giving effect to the transaction and no such persons are also insiders of New Battery. Similarly, there is no known relationship between or among any person who or which is a non-arm's-length party of Fusion and any person who or which is a non-arm's-length party to New Battery.

Sponsorship

Sponsorship of a qualifying transaction of a capital pool company is required by the TSX-V unless exempt therefrom in accordance with the TSX-V's policies or a waiver is obtained. In the absence of an available exemption from the sponsorship requirements, Fusion intends to make an application to the TSX-V for a waiver from sponsorship requirements. There is no assurance that if applied for, a waiver will be granted.

Filing statement

In connection with the transaction and pursuant to the requirements of the TSX-V, Fusion will file a filing statement on its issuer profile on SEDAR, which will contain details regarding the transaction, Fusion, New Battery and the resulting issuer.

Trading halt

In accordance with the policies of the exchange, the Fusion shares are currently halted from trading and will remain so until such time as the exchange determines, which, depending on the policies of the exchange, may not occur until completion of the transaction.

Cautionary note

Completion of the transaction is subject to a number of conditions, including but not limited to, exchange acceptance and if applicable pursuant to exchange Requirements, majority of the minority shareholder approval. Where applicable, the transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the 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 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 a capital pool company should be considered highly speculative.

We seek Safe Harbor.