Highfield Resources (HFR) Investor Update summary

Strategic transactions and funding

• Signed a non-binding letter of intent with Qinghai Salt Lake, a China Minmetals subsidiary, for a proposed $300 million equity subscription to advance the Muga Potash project and other opportunities.

• Qinghai Salt Lake is China's largest potash producer, with 5 million tonnes annual capacity, bringing significant operational and investment expertise.

• The $300 million equity injection is a substantial commitment, with strong support from the Board and major shareholder AMR Capital.

• AMR provided a non-dilutive standby loan facility of up to EUR 1.15 million, with an extension of convertible note maturity to July 31, 2025, or 75 days after a binding MOU.

• Loan facility is for working capital during the strategic period, with fixed coupon at market rates and six-month maturity from first drawdown.

Organizational changes and project continuity

• Recent CEO resignation addressed, with leadership transition seen as having little to no effect on project progress or transaction execution.

• Internal team considered capable of taking the project through to completion and development, with plans to expand post-transaction.

• Board and AMR remain committed to finalizing the deal and advancing the Muga project.

• Both China Minmetals and Yankuang were briefed on leadership changes and remain supportive.

• Team morale and capability highlighted as strong, with no need for external hires.

Transaction process, risks, and timeline

• The LOI is non-binding, subject to further negotiation and due diligence, with regulatory approvals required.

• Site visits by Qinghai Salt Lake are scheduled, and updates on timing will be provided as available.

• All parties intend to resolve any conflicts with the existing Yankuang Energy transaction to maintain progress.

• Key risk is the non-binding nature of the LOI, but China Minmetals has a strong mandate and commitment to global diversification.

• Regulatory hurdles are not seen as impediments, with prior approvals in place for similar transactions.