Trilogy Metals Announces Strategic Investment by US Federal Government

Core Viewpoint - Trilogy Metals Inc. has entered into a binding letter of intent with South32 Limited and Ambler Metals LLC for a significant investment from the U.S. Department of War to advance the exploration and development of the Upper Kobuk Mineral Projects in Alaska, highlighting the strategic importance of these projects for U.S. national security and critical mineral supply [2][9]. Investment Details - The U.S. Department of War will invest approximately $35.6 million in the development of critical mineral resources at the Upper Kobuk Mineral Projects, acquiring about 10% of Trilogy Metals [3]. - The investment includes approximately $17.8 million for 8,215,570 units at a price of $2.17 per unit, with each unit comprising one common share and 3/4 of a 10-year warrant [3]. - An additional $17.8 million will be paid to South32 for common shares of Trilogy Metals and a call option to acquire more shares at a price of $0.01 per share [4]. Use of Funds - Trilogy Metals and South32 will utilize the funds to advance exploration and development efforts at the Upper Kobuk Mineral Projects [5]. - The U.S. Department of War will have the right to appoint one independent director to Trilogy Metals' board for three years and will restrict Trilogy from incurring third-party debt exceeding $1 billion without prior approval [5]. Project Development - The transaction includes discussions for a framework agreement to permit, finance, and construct the Ambler Road, which is essential for the development of mineral projects in the region [6]. - The Ambler Road is a proposed 211-mile road that will facilitate exploration and development in the Ambler Mining District [8]. Strategic Importance - The partnership with the U.S. Government is seen as a milestone for Trilogy Metals, emphasizing the importance of the Upper Kobuk Mineral Projects in supporting U.S. energy, technology, and national security priorities [9][10]. Regulatory Considerations - The transaction is subject to regulatory and stock exchange approvals, with expectations to close following the reauthorization of the Defense Production Act and completion of a Foreign Ownership review [7].