Talon Metals Announces $8 Million US Royalty Agreement with Triple Flag

Tamarack, Minnesota–(Newsfile Corp. – July 5, 2024) – Talon Metals Corp. (TSX: TLO) (OTC Pink: TLOFF) (“Heel” or the “Business“) is pleased to announce that Talon Nickel (USA) LLC (“Nickel Heel“), a wholly-owned subsidiary of Talon, has agreed to grant an additional royalty on net smelter returns to a subsidiary of Triple Flag Precious Metals Corp. (“Triple flag“), Triple Flag USA Royalties Ltd. (“Triple American Flag“), in consideration for the payment of US$8.0 million (approximately CAD$10.9 million) (the “Triple Flag Transaction in the United States“).

The principal terms of the Triple Flag US Transaction are described below. The proceeds of the Triple Flag US Transaction are intended to be used to continue to advance the Tamarack Nickel Project in Minnesota, USA, and the Michigan Nickel-Copper Project in the Upper Peninsula of the State of Michigan, USA, and for general working capital purposes.

Henri van Rooyen, CEO of Talon, commented: “Triple Flag is a long-time partner of Talon and is familiar with our projects and team. We welcome this vote of confidence in our plan to discover, delineate and produce nickel and other critical minerals in the United States. The proceeds of this financing, along with Talon’s two major U.S. government grants, are valuable sources of non-dilutive funding that support our operations in Minnesota, North Dakota and Michigan through 2025.”

Triple Flag Transaction in the United States

The main terms of the US Triple Flag transaction are as follows:

In exchange for the cash consideration of US$8.0 million (approximately C$10.9 million), (a) Triple Flag, through its subsidiary Triple Flag US, received an additional 1.67% net smelter return royalty on the Company’s interest in the Tamarack Project (subject to Talon’s buyout right further described below) (the “Redemption”).New royalty“); and (b) the Company issued 8 million common share purchase warrants, each exercisable to acquire one common share of the Company for a period of two years following the closing date of the Triple Flag US Transaction at an exercise price of C$0.20 per share.
Exercisable for a period of up to two years after the closing date of the Triple Flag US transaction, subject to acceleration in certain circumstances, Talon has a repurchase right (the “Talon’s Right of Redemption“) of 0.67% of the new royalty for US$5.0 million, which would reduce the new royalty to 1.0%. The exercise of Talon’s repurchase right is at the discretion of the Company. In the event of a change of control transaction involving Talon during the two-year period, to the extent not exercised, Talon’s repurchase right will terminate early and on the date that is 25 days after the completion of such change of control transaction.
Triple Flag US has the right to increase the designated percentage of the new royalty by an additional 0.50% upon payment of an additional US$2.0 million in the event that the Company’s cash balance decreases to an amount below US$2.0 million and such decrease is not cured within 60 days. Talon’s right to repurchase would also terminate in such circumstances. Triple Flag US’s right to increase the designated percentage terminates with respect to a reduction in the applicable cash balance if such right is not exercised within an additional 60 days after the Company’s cure period has expired.
The Company, together with its other wholly-owned subsidiaries, Cloudmine Holdings Limited and Talon Metals (USA) Inc., have agreed to guarantee Talon Nickel’s payment and performance obligations under the royalty agreement entered into in connection with the Triple Flag US transaction, and Talon and its subsidiaries have provided a guarantee to Triple Flag US to support the payment and performance obligations related to the new royalty and guarantees.

ABOUT TALON

Talon is a TSX-listed base metals company in a joint venture with Rio Tinto on the high-grade Tamarack nickel-copper-cobalt project located in central Minnesota. Talon’s shares also trade in the United States on the over-the-counter market under the symbol TLOFF. The Tamarack Nickel Project comprises a large land position (18 km strike length) with additional high-grade intercepts outside the current resource area. Talon has an acquisition right to acquire up to 60% of the Tamarack Nickel Project and currently owns 51%. Talon is focused on (i) expanding and infilling its existing NI 43-101 prepared high-grade nickel mineralization resource to inform a mine plan for submission to Minnesota regulators, and (ii) following up on additional high-grade nickel mineralization within the Tamarack Intrusive Complex. Talon has entered into a neutrality and workforce development agreement with the United Steelworkers union. Talon’s battery minerals processing plant in Mercer County has been selected by the U.S. Department of Energy for a $114.8 million grant under the Bipartisan Infrastructure Act and the U.S. Department of Defense has awarded Talon a $20.6 million grant to support and accelerate Talon’s exploration efforts in Minnesota and Michigan. Talon has experienced and skilled teams in exploration, mine development, external affairs and mining permitting.

For more information about Talon, please visit the Company’s website at www.talonmetals.com or contact:

Sean Werger
1 (416) 500-9891
Email: [email protected]

ABOUT TRIPLE FLAG

Triple Flag is a streaming and royalty company focused on precious metals. Triple Flag provides tailored financing solutions to the metals and mining sector, primarily exposed to gold and silver in the Americas and Australia, with a total of 234 assets, including 15 streams and 219 royalties. These investments are tied to mining assets at various stages of the mine lifecycle, including 32 producing mines and 202 projects in the development and exploration phase. Triple Flag is listed on the Toronto Stock Exchange and the New York Stock Exchange, under the symbol “TFPM”.

FORWARD-LOOKING STATEMENTS

This press release contains certain “forward-looking statements.” All statements, other than statements of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future are forward-looking statements. These forward-looking statements reflect the Company’s current expectations or beliefs based on information currently available to it. These forward-looking statements include statements relating to the intended use of proceeds received from the Triple Flag US transaction and other available funds; plans to discover, delineate and produce nickel and other critical minerals in the United States; future exploration, drilling and results therefrom; and the potential for high-grade mineralization. Forward-looking statements are subject to significant risks and uncertainties and other factors that could cause actual results to differ materially from those discussed in the forward-looking statements, and even if such actual results are realized or materially realized, there can be no assurance that they will have the expected consequences or effects on the Company.

Forward-looking statements speak only as of the date on which they are made and, except as required by applicable securities laws, the Company disclaims any intention or obligation to update any forward-looking statements, whether as a result of new information, future events or results or otherwise. Although the Company believes that the assumptions inherent in the forward-looking statements are reasonable, such statements are not guarantees of future performance and, accordingly, undue reliance should not be placed on such statements due to the inherent uncertainty therein.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/215520