Metals Royalty Company Inc (TMCR) News & EventsTMCRNews & EventsMetals Royalty Company Inc

Metals Royalty Company Announces $140M Convertible Notes Financing Package

The Metals Royalty Company announced a financing package comprised of a $140M offering of convertible secured notes and a $25M senior secured term loan facility. The proceeds of the Notes and the Loan Facility will be used: to fund the closing of the Company's previously announced acquisition of an additional 1.0% Index-Priced Gross Overriding Production Royalty with a Revenue Floor in the Mesabi Metallics iron ore project in Nashwauk, Minnesota, from Ironclad Royalties to repay in full the Company's existing senior term loan facility and for general corporate purposes. Closing of the Notes, the Loan Facility and the acquisition of the Additional Mesabi Royalty is expected to occur concurrently on or about August 24. The Company has entered into subscription agreements with certain institutional and accredited investors for the purchase and sale of $140M aggregate principal amount of the Notes in a private placement. The closing of the Notes offering and the funding of the Loan Facility are subject to customary closing conditions, including the concurrent closing of the acquisition of the Additional Mesabi Royalty. In addition, the Company has entered into a term sheet with Ironclad to amend the purchase agreement for the Additional Mesabi Royalty to increase the share consideration to an aggregate value of $27.5M, in a transaction exempt from the registration requirements of the Securities Act of 1933, as amended and make a corresponding reduction in the cash consideration.

Metals Royalty Company Acquires 25% Interest in Mesabi Metallics

The Metals Royalty Company entered into a definitive agreement with Ironclad Royalties and Mesabi Investments with respect to the acquisition of a 25% interest in an existing 4.0% Index-Priced Gross Overriding Production Royalty with a Revenue Floor n the Mesabi Metallics iron ore project located in Nashwauk, Minnesota. In connection with the Transaction, the Company also announces: a allocated $75M private sale of common shares, which includes $15M of participation from founders and insiders, priced at $13.00 per share; and up to a $50M acquisition credit facility term sheet for a senior secured term loan credit facility. Stifel is acting as lead placement agent and A.G.P./Alliance Global Partners is acting as co-lead placement agent for the PIPE Financing. Yorkville Securities, William Blair and B. Riley Securities are acting as co-placement agents for the PIPE Financing. TMCR is acquiring a 1.0% Index-Priced Gross Overriding Production Royalty with a Revenue Floor on all production up to 8.5 million tonnes per annum and a 0.25% royalty on all production above 8.5 Mtpa, on mineral tracts and mineral leases owned by Mesabi Metallics Company. The royalty is indexed to the Platts Direct Reduction Pellet 67.5% Fe FOB Brazil price with an embedded revenue floor of $150 per tonne, providing structural downside protection while preserving full exposure to commodity price appreciation. Total Purchase Price: $132.5 million, comprising $125M in cash and $7.5M in TMCR common shares to be based on the price of the PIPE Financing. Deposit: $15M payable upon execution of the Definitive Agreement, credited toward the purchase price at closing, unless rolled over when the Option to Purchase Additional 1.0% is exercised. Royalty Step-Down: Following cumulative production of 170 million tonnes, the royalty would step down to 0.25% on production up to 8.5 Mtpa and 0.0625% on production above 8.5 Mtpa. Option to Purchase Additional 1.0%: TMCR has a 45-day option to purchase an additional 1.0% following closing of the initial 1.0% purchase. Expected Closing: Prior to May 31, 2026, subject to the satisfaction of applicable conditions. In connection with the Transaction, TMCR has allocated commitments from institutional and accredited investors for the PIPE Financing, which is expected to result in gross proceeds of approximately $75 million, before placement agent fees and offering expenses, of which $15M represents founder and insider participation. Pursuant to the allocated commitments, TMCR intends to sell an aggregate of 5,769,231 common shares at a purchase price of $13.00 per common share. YA II PN has agreed to purchase 1,153,900 common shares in the offering. The PIPE Financing is conditional upon, and is expected to close concurrently with, or immediately prior to, the closing of the Transaction, subject to the satisfaction of applicable conditions. Completion of the Transaction is conditional upon, among other things, the Company satisfying a financing condition for the total purchase price of the transaction. In addition to the PIPE Financing, the Company has entered into a term sheet for up to a $50M senior secured Credit Facility. The term sheet contemplates a single-draw, non-revolving facility with a 36-month maturity, bearing interest at 9.0% per annum with step-ups over time, and secured by a first-priority interest over the Company's assets. The Credit Facility is expected to close concurrently with, or immediately prior to, the closing of the Transaction, subject to satisfaction of applicable conditions, including completion of due diligence and execution of definitive documentation.