Royal Road Minerals Enters into Binding Letter of Intent for the Sale of Its 50% Interest in the Luna Roja Gold Project in Nicaragua

Toronto, December 17, 2020 - Royal Road Minerals Ltd. (TSXV: RYR) ("Royal Road" or the "Company") is pleased to announce that it has entered into a binding letter of intent (the "Letter Agreement") with Mineros S.A. ("Mineros"), pursuant to which the Company has agreed to sell to Mineros its entire 50% interest in the Luna Roja Project, comprising the Monte Carmelo I and Monte Carmelo II mining concessions, in Nicaragua. The Luna Roja Project is currently jointly owned and operated by the Company and Hemco -Nicaragua,S.A. ("Hemco"), a wholly-owned subsidiary of Mineros, pursuant to the terms of a strategic alliance agreement (the "Strategic Alliance Agreement") dated September 1, 2017, as amended.

Under the terms of the Letter Agreement, the Company agreed to sell and Mineros agreed to purchase the Company's 50% interest in the Luna Roja Project on the following key terms:

• Purchase Price - Mineros will pay to the Company a purchase price of (i) US$22.5 million payable in cash on the closing of the proposed transaction, plus (ii) a 1.25% net smelter royalty on all future mineral production from the Monte Carmelo I and Monte Carmelo II mining concessions commencing from the first production therefrom.
• Expenditure Commitment - The Company will invest no less than US$7.5 million over a five-year period in exploration operations on the strategic alliance properties in Nicaragua.

"This is a model transaction, anticipated under the terms of our successful strategic alliance with Mineros and in-keeping with the ambitions of both companies," said Tim Coughlin, Royal Road's President and CEO. "Our focus moves now to the exciting Caribe gold discovery, located just 16km to the south of Luna Roja and to other promising gold and copper projects we are advancing together, throughout the highly prospective 'Golden Triangle' and elsewhere in Nicaragua".

The completion of the proposed transaction is subject to a number of conditions including the entering into by the parties of a definitive agreement (the "Definitive Agreement"), the prior approval by the boards of directors of each of Mineros and the Company of the Definitive Agreement, the closing of the proposed transaction no later than June 30, 2021 (the "Outside Date"), and the completion of due diligence by each of Mineros and the Company to its reasonable satisfaction regarding legal, financial, and tax matters. In addition, the Definitive Agreement would contain representations and warranties to be agreed upon and provide for other customary conditions, including the receipt of all required shareholder and regulatory approvals, including the approval of the TSX Venture Exchange, and third-party consents to the extent required. The Letter Agreement may be terminated by either party if a Definitive Agreement has not been entered into by February 28, 2021; and by either party if any of the conditions precedent to closing shall have become incapable of fulfilment and shall not have been waived, including the closing of the proposed transaction by the Outside Date.

The Strategic Alliance Agreement will be amended upon closing of the proposed transaction to exclude the Monte Carmelo I and Monte Carmelo II concessions from the Company's exploration joint venture with Hemco but will not terminate and will continue in effect with respect to the Company's other projects in Nicaragua, including its Caribe Project and other projects operated under the Strategic Alliance Agreement.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

The information in this news release was approved by Dr. Tim Coughlin, BSc (Geology), MSc (Exploration and Mining), PhD (Structural Geology), FAusIMM, President and Chief Executive Officer of Royal Road Minerals Ltd. and a qualified person as defined by National Instrument 43-101.

Cautionary statement:

This news release contains certain statements that constitute forward-looking information and forward-looking statements within the meaning of applicable securities laws (collectively, "forward-looking statements") including statements relating to the proposed sale transaction described herein and those describing the Company's future plans and the expectations of its management that a stated result or condition will occur. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company, or developments in the Company's business or in the mineral resources industry, or with respect to the transaction, to differ materially from the anticipated results, performance, achievements or developments expressed or implied by such forward-looking statements. Forward-looking statements include all disclosure regarding possible events, conditions or results of operations that is based on assumptions about, among other things, future economic conditions and courses of action, and assumptions related to government approvals, and anticipated costs and expenditures. The words "plans", "prospective", "expect", "intend", "intends to" and similar expressions identify forward looking statements, which may also include, without limitation, any statement relating to future events, conditions or circumstances. Forward-looking statements of the Company contained in this news release, which may prove to be incorrect, include, but are not limited to, those related to the Transaction, the Company and the Company's exploration plans.

The Company cautions you not to place undue reliance upon any such forward-looking statements, which speak only as of the date they are made. There is no guarantee that the anticipated benefits of the proposed sale transaction and the Company's business plans or operations will be achieved. The risks and uncertainties that may affect forward-looking statements include, among others: economic market conditions, anticipated costs and expenditures, government approvals, and other risks detailed from time to time in the Company's filings with Canadian provincial securities regulators or other applicable regulatory authorities. Forward-looking statements included herein are based on the current plans, estimates, projections, beliefs and opinions of the Company management and, except as required by law, the Company does not undertake any obligation to update forward-looking statements should assumptions related to these plans, estimates, projections, beliefs and opinions change.

For further information please contact:
Dr. Timothy Coughlin
President and Chief Executive Officer

USA-Canada toll free 1800 6389205
+44 (0)1534 887166
+44 (0)7797 819539
info@royalroadminerals.com

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