Altius Minerals : 2024 AIF

Published: 2025-03-25 16:37:13 ET ALS.TO

Annual Information Form

For the year ended December 31, 2024

Dated: March 25, 2025

Table of Contents

Table of Contents ......................................................................................................................

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Forward-looking Information .................................................................................................. 1

Non-GAAP Financial Measures ............................................................................................... 3

Technical and Third-Party Information ................................................................................. 3

Corporate Structure ................................................................................................................. 3

General Development of the Business ................................................................................... 4

Three Year History .................................................................................................................... 5

Description of the Business ..................................................................................................... 10

Overview of Corporate Policies and Oversight ..................................................................... 13

Risk Factors ............................................................................................................................... 18

Royalty Portfolio ....................................................................................................................... 32

Dividends and Distributions .................................................................................................... 35

Description of Capital Structure ............................................................................................. 35

Market for Securities ................................................................................................................ 35

Directors and Officers .............................................................................................................. 36

Legal Proceedings ..................................................................................................................... 39

Interest of Management and Others in Material Transactions .......................................... 39

Transfer Agent and Registrar .................................................................................................. 40

Material Contracts .................................................................................................................... 40

Interests of Experts .................................................................................................................. 40

Audit Committee ...................................................................................................................... 42

Additional Information ............................................................................................................ 43

Schedule "A" - Chapada Mine ................................................................................................. 45

Schedule "B" - Rocanville Royalty .......................................................................................... 60

Schedule "C"- Esterhazy Royalty ............................................................................................ 80

Schedule "D" - Expanded Silicon Project .............................................................................. 94

Schedule "E" - Audit Committee Charter .............................................................................. 127

Forward-looking Information

Unless otherwise noted, the information given herein is as of December 31, 2024.

Certain statements made in this document that are not current or historical factual statements may constitute "forward looking information" within the meaning of applicable Canadian securities legislation. Forward looking information may include, but is not limited to, statements with respect to future events or future performance; the effect of the Copper Purchase Agreement in respect of the Chapada Mine (each as defined herein) on Altius Minerals Corporation's ("Altius" or the "Corporation") financial position and/or results; production volumes; the financial and operational strength of counterparties; industry conditions, trends and practices; realized prices for production; future mineral reserves and mine life; management's expectations regarding the Corporation's growth and results of operations; estimated future revenues; fluctuations in the prices of the primary commodities that are material for the Corporation's royalty revenue (including potash, iron ore, and copper); requirements for additional capital; business prospects and opportunities including within renewable energy; treatment under governmental regulatory regimes with respect to environmental matters; treatment under governmental taxation regimes; government regulation of mining operations; dependence on personnel; and competitive conditions. Such forward looking information reflects management's current beliefs and is based on information currently available to management. Expressions such as "anticipates", "expects", "believes", "estimates", "could", "intends", "may", "plans", "will", "would", "pro forma" and other similar expressions, or the negative of these terms, are generally indicative of forward looking information. By its very nature, forward looking information requires the Corporation to make assumptions and is subject to inherent risks and uncertainties which give rise to the possibility that the Corporation's predictions, forecasts, expectations or conclusions will not prove to be accurate, that the Corporation's assumptions may not be correct and that the Corporation's objectives, strategic goals and priorities will not be achieved. Such forward looking information is not fact but only reflects management's estimates and expectations.

A number of factors could cause actual events or results to differ materially from any forward looking information, including, without limitation: fluctuations in the prices of the primary commodities that drive royalty revenue; fluctuations in the value of the Canadian dollar; changes in national and local government legislation, including permitting, licensing and environmental regimes and taxation policies; regulations and political or economic developments in any of the jurisdictions where properties in which the Corporation holds a royalty or other interest are located; influence of macroeconomic developments; reduced access to debt and equity capital; litigation; title, permit or licensing disputes related to the Corporation's interests or any of the properties in which the Corporation holds a royalty or other interest; excessive cost escalation as well as development, permitting, infrastructure, operating or technical difficulties on any of the properties in which the Corporation holds a royalty or other interest; rate and timing of production differences from resource estimates; risks and hazards associated with the business of development and mining on any of the properties in which the Corporation holds a royalty or other interest, including, but not limited to unusual or unexpected geological and metallurgical conditions, slope

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failures or cave ins, flooding and other natural disasters; and the ability of certain renewable royalty investments to (as defined herein) to meet certain milestones.

The forward looking information contained herein is based upon assumptions management believes to be reasonable, including, without limitation: the ongoing operation of the properties in which the Corporation holds a royalty or other interest by the owners or operators of such properties in a manner consistent with past practice; the accuracy of public statements and disclosures made by the owners or operators of such underlying properties; no material adverse change in the market price of the commodities that underlie the asset portfolio; no adverse development in respect of any significant property in which the Corporation holds a royalty or other interest; the accuracy of publicly disclosed expectations for the development of underlying properties that are not yet in production; and the absence of any other factors that could cause actions, events or results to differ from those anticipated, estimated or intended. However, there can be no assurance that forward looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Investors are cautioned that the forward looking information is not a guarantee of future performance. The Corporation cannot assure investors that actual results will be consistent with any forward looking information disclosed herein. Accordingly, investors should not place undue reliance on forward looking information due to the inherent uncertainty thereof. For additional information with respect to risks, uncertainties and assumptions, please refer to the "Risk Factors" section of this Annual Information Form ("AIF").

The forward looking information disclosed herein is provided as of the date of this AIF only and the Corporation does not assume any obligation to update or revise such information to reflect any new information, estimates or opinions, future events or results or otherwise, except as required by applicable law.

Non-GAAP Financial Measures

Management uses the following non-GAAP financial measures: attributable revenue, attributable royalty revenue, adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA), adjusted operating cash flow and adjusted net earnings (loss).

Management uses these measures to monitor the financial performance of the Corporation and its operating segments and believes these measures enable investors and analysts to compare the Corporation's financial performance with its competitors and/or evaluate the results of its underlying business. These measures are intended to provide additional information, not to replace International Financial Reporting Standards (IFRS) measures, and do not have a standard definition under IFRS and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. As these measures do not have a standardized meaning, they may not be comparable to similar measures provided by other companies. Further information on the composition and usefulness of each non-GAAP financial measure, including reconciliation to their most directly comparable IFRS measures, is included in the non-GAAP financial measures section in the Corporation's Management Discussion and Analysis.

Technical and Third-Party Information

Except where otherwise stated, the disclosure in this AIF relating to properties and operations on the properties in which Altius holds royalty and streaming interests is based primarily on information publicly disclosed by the owners or operators of these properties and information available in the public domain as at March 25, 2025. As a royalty holder, Altius has limited, if any, access to properties included in its royalty portfolio. Altius generally relies on publicly available information regarding these properties and operations and generally has no ability to independently verify such information. Additionally, Altius has, and may from time to time receive, operating information from the owners and operators of these properties which it is not permitted to disclose to the public. Altius is dependent on the operators of the properties and their qualified persons to provide information to Altius or on publicly available information to prepare required disclosure pertaining to properties and operations on the properties on which Altius holds royalty and streaming interests and generally has limited or no ability to independently verify such information. Although Altius does not have any knowledge that such information may not be accurate, there can be no assurance that such third party information is complete or accurate.

All currency references in this AIF are to Canadian dollars unless otherwise indicated.

Corporate Structure

Name, Address and Incorporation

The Corporation was incorporated as a private corporation under the name 730260 Alberta Inc. by certificate and articles of incorporation (the "Articles") issued pursuant to the provisions of the Business Corporations Act (Alberta) on March 5, 1997. The Articles were amended by certificate and articles of amendment dated June 12, 1997 to remove the "private company" provisions and the restrictions on share transfers and to change the name of the Corporation to "Altius Minerals Corporation."

The head office of the Corporation is located at 2nd Floor, 38 Duffy Place, St. John's, Newfoundland and Labrador A1B 4M5. Its registered office is located at 4200 Bankers Hall West, 888 - 3rd Street S.W., Calgary Alberta, T2P 5C5.

Intercorporate Relationships

The following chart sets forth the intercorporate relationships between the Corporation and certain subsidiaries, their jurisdictions of incorporation, continuance, formation, or organization, as applicable, and the Corporation's current equity interest in each such subsidiary.

General Development of the Business

The Corporation manages its business under three operating segments, consisting of (i) the acquisition and management of producing and development stage royalty and streaming interests ("Mineral Royalties"), (ii) the acquisition and early stage exploration of mineral resource properties with a goal of vending the properties to third parties in exchange for early stage royalties and minority equity or project interests ("Project Generation") and (iii) its 57% interest in Altius Renewable Royalties Corp. ("ARR"), which is focused on the acquisition and management of renewable energy investments and royalties ("Renewable Royalties").

The Corporation's diversified mineral royalties and streams generate revenue from 11 operating mines located in Canada (9) and Brazil (2) that produce copper, nickel, cobalt, lithium, potash and iron ore. It also holds a construction stage royalty interest in a copper-gold mine and indirect royalty interests in two construction stage lithium mines. The Corporation further holds a diversified portfolio of pre-production stage royalties and junior equity positions that it mainly originates through mineral exploration initiatives within its Project Generation business division. The Corporation also indirectly holds royalties related to renewable energy generation projects located primarily in the United States through its 57% interest in ARR. ARR owns 50% of Great Bay Renewables LLC ("GBR") with certain funds managed by affiliates of Apollo Global Management, Inc. (the "Apollo Funds") owning the other 50%. GBR directly holds the portfolio of renewable royalties and investments.

Significant Acquisitions

The Corporation did not complete any significant acquisitions during the year ended December 31, 2024.

Three Year History

Year ended December 31, 2024

Attributable royalty revenue and adjusted EBITDA

Revenue and attributable royalty revenue as well as adjusted EBITDA decreased from 2022 and 2023 levels based on lower potash prices and lower coal revenue due to the closure of the Genesee Mine at the end of 2023 offset by higher base metal prices, higher dividends from iron ore and growth of the renewable royalty portfolio. Adjusted operating cash flow for 2024 reflected lower royalty revenues and timing of working capital changes. Changes in total assets reflect the growth of the Corporation's renewable royalty segment offset by investment sales and revaluations, the closure of the Genesee Mine (the royalty interest was fully amortized) as well as an impairment loss on the Pickett Mountain royalty at the end of both 2023 and 2024. The decrease in total liabilities is a result of repayments on long term debt offset by changes to corporate and deferred tax liabilities.

Altius Renewable Royalties Corp.

On December 5, 2024 the Corporation announced that ARR completed a statutory plan of arrangement with Northampton Capital Partners, LLC ("Northampton") who acquired all of the issued and outstanding common shares of ARR other than those owned by Altius. The agreement allows for an equally shared governance structure and as a result the Corporation has determined it will account for ARR as an interest in joint venture for financial reporting purposes instead of a subsidiary. Following completion of the transaction the Corporation's share of earnings (loss) and other comprehensive earnings (loss) is reflective of its proportionate 57% ownership of ARR. ARR and Apollo both still hold their 50% interest in the GBR joint venture.

The Corporation owns 17,937,339 common shares as well as 3,093,835 share purchase warrants in ARR.

Acquisition of Adventus by Silvercorp Metals Inc.

In July 2024, Silvercorp Metals Inc. ("Silvercorp") acquired all of the outstanding common shares of Adventus Mining Corporation ("Adventus"), of which Altius was a founding shareholder and a convertible debenture lender. Prior to the closing of the arrangement the Corporation agreed to not exercise its additional royalty conversion option and instead received cash consideration of $9,562,000 for settlement of its US$4,000,000 convertible loan outstanding, while retaining its original 2% NSR royalty. The cash consideration received reflected the implied equity value of the transaction as if the Corporation had converted its outstanding loan receivable to common shares of Adventus. On August 6, 2024 Silvercorp announced that Curipamba has received its final exploitation permit to enter construction and on August 21, 2024 announced the initiation of the construction process with a goal of first production in 2026.

Voisey's Bay Expansion

In December 2024 Vale Base Metals completed construction and commissioning of its US$2.94 billion Voisey's Bay Mine Expansion Project and announced that they are expecting an increase in production of nickel in concentrate to 45,000 tonnes per year (45 ktpy). The expansion project transitioned Voisey's Bay from open pit to underground mining. The project involved the development of two underground mines - Reid Brook and Eastern Deeps - which will deliver concentrate for processing at Vale's Long Harbour Processing Plant, one of the lowest-emission nickel processing plants in the world. Full ramp-up of the project is expected in the second half of 2026.

Acquisition of Investments

During the year ended December 31, 2024the Corporation sold equity investments from the Project Generation portfolio for gross proceeds of $26,400,000. The Corporation acquired investments of $11,300,000, including additional shares of Orogen Royalties Inc. ("Orogen"), resulting in net proceeds of $15,100,000 for the year.

Capital Allocation

The Corporation's capital allocation priorities are linked to its strategy of creating per share value growth through a portfolio of assets that relate to long-life, high margin operations while providing growing shareholder capital returns.

In addition to the acquisition of investments noted above, during the year ended December 31, 2024 the Corporation made $8,000,000 in scheduled payments on its credit facilities and paid aggregate cash dividends of

$14,842,000 and issued 59,269 Common Shares under its DRIP program ($0.35 per common share). There were

213,100 shares repurchased under its normal course issuer bid during the fourth quarter of 2024 at a cost of

$5,472,974 and 761,500 were repurchased and cancelled during the year ended December 31, 2024 at a cost of

$16,196,000 or $21.27 per share.

The Corporation renewed its Normal Course Issuer Bid ("NCIB") by which it may purchase at market price up to 1,865,313 common shares being approximately 4.01% of the 46,467,476 common shares issued and outstanding as of August 12, 2024, through the facilities of the Toronto Stock Exchange ("TSX") or a Canadian alternative trading system. The NCIB commenced on August 22, 2024 and will end no later than August 21, 2025. Any shares purchased during the NCIB will be cancelled and returned to treasury.

On August 30, 2024, the Corporation amended its credit facility to extend the term from August 2025 to August 2028 and replace the combination of its previously outstanding term and revolver debt. The total available credit of $225,000,000 and its principal repayments are consistent with its previous credit facility and the Corporation did not draw any additional amounts during the year. The amended credit facility consists of a $50,000,000 term credit facility, a US$36,000,000 term credit facility and a $125,000,000 revolving credit facility.

Silicon project and royalty implications

AngloGold Ashanti plc ("AGA") continues to advance the discovery of a potential major new gold district, centered around its Silicon Project near Beatty, Nevada. In 2024 AGA provided an update for the 'Expanded Silicon Project', which includes both the Silicon and Merlin gold deposits, that was highlighted by the announcement of an initial Inferred Mineral Resource of 9.05 million ounces at the Merlin deposit (283.9 Mt at 0.99 g/t gold). Recently, on February 19, 2025, AGA announced an updated resource for the Expanded Silicon Project, reporting a total of 12.91 Moz (391.14 Mt at 1.03 g/t gold) in the Inferred Resources category, due to an increase in the Merlin deposit to 355.1 Mt @ 1.06 g/t gold. This is in addition to the more than 3.4 million ounce Mineral Resource estimate (121.56 at 0.87 g/t Indicated Mineral Resource) previously published for the adjacent Silicon deposit. A pre-feasibility study ("PFS") for the Expanded Silicon Project is currently in progress and is expected to be completed in H2 2025. The basis of the PFS targets oxide ore only while AGA recently stated there is "significant upside potential from deeper ore horizons and nearby exploration targets" and that infill and extension drilling programs continue. Altius holds a 1.5% net smelter return ("NSR") royalty related to the project.

In late 2024, AGA also provided additional highlights from the 132,000 meters of delineation drilling completed at the Merlin deposit for the year. This included intercepts of 144.5m grading 10.53 g/t gold (hole MER-24-0267-RD) and 190.4m at 5.12 g/t gold (hole MER-23-245-RD), all within oxide material. In 2024 AGA also reported a "significant intercept" from a geotechnical hole drilled 900m north of the Silicon Deposit. Moreover, in reference to what appears to be a new potential mineralized domain at Merlin, AGA announced on February 19 that "a deeper drillhole was also completed to the east that tested the hanging wall of the Bare Mountain Fault, with encouraging visual observations and results pending" .

The Corporation delivered requests to AGA under the terms of its royalty agreement for the registration of our royalty interest in claims staked, held or owned by AGA in the Beatty District that are in addition to previously registered lands and beyond the current footprint of the Expanded Silicon Project. AGA did not agree that these additional claims are subject to the royalty and arbitration proceedings to resolve the dispute, in accordance with the dispute resolution mechanism provided for in the royalty agreement, have taken place.

In January, the Corporation received a partial award decision ("Partial Award") by the Arbitration Tribunal ("Tribunal") relating to the extents of its royalty interests within the Silicon gold district. The Tribunal has determined that the lands that are subject to the Altius royalty include the entirety of those encompassed within the 26.6 km2 base area of interest ("Base AOI") described in our royalty agreement and also certain areas of contiguous and/or adjacent mineral lands currently held by AGA that extend beyond the limits of the Base AOI. With respect to lands that are subject to the royalty that extend beyond the Base AOI, the Tribunal has provided its interpretation of various elements of the agreement within its Partial Award and directed the parties, within 60 days, to jointly submit a detailed list of the various individual claim units believed to be subject to the royalty. If the parties report that any issues exist between them in itemizing or specifying the mining claims subject to the royalty, then the Tribunal will decide them and subsequently issue its final award.

Altius interprets the Partial Award as providing for significant expansion of its royalty rights in all directions around the Base AOI area, including for several kilometers along projected northwest and northeast trend extensions of structures that it believes represent important geological controls on mineralization at both Silicon and Merlin, as well as over extensive areas within the district to the south of the Base AOI that have seen limited exploration to date. Altius and AGA did not, within the 60 day period, reach agreement on a joint submission of the additional claims subject to the royalty and have now each presented individual submissions to the Tribunal. These are being considered by the Tribunal and in due course a further award will be delivered by the Tribunal, which hopefully will finalize the matter.

Kami Project Updated Feasibility Study and Partnership with Nippon Steel

At the end of January 2024, Champion Iron Limited ("Champion") announced the results of an updated project study for the Kami project ("Kami Project Study"). The Kami Project Study evaluated the potential for Kami's high-purity iron ore concentrates (direct reduction or "DR" quality,>67.5% Fe) to support growth in the electric arc furnace steel-making sector. The study details a 25-year life of mine with average annual DR quality iron ore concentrate production of approximately 9.0M wmt per annum at above 67.5% Fe. Champion presented estimated capital expenditures, production and operating cost metrics and strategy for next steps, which included a focus on securing a joint venture partner for the project and various pricing and return scenarios.

In December 2024 Champion further announced a partnership with Nippon Steel Corporation ("Nippon") and Sojitz Corporation ("Sojitz) to acquire a 49% interest in Kami in exchange for significant upfront payments ($245 million) to Champion and pro-rata contributions toward project development costs. A Feasibility Study is expected to be completed in mid 2026.

Altius originated the Kami project within its Project Generation business and retains a 3% gross sales royalty interest, which is subject to a 20% provincial mineral tax applied to revenue, resulting in a effective 2.4% gross sales royalty interest.

Year ended December 31, 2023

Attributable royalty revenue and adjusted EBITDA

Revenue and attributable royalty revenue (see Non-GAAP financial measures section) as well as adjusted EBITDA decreased from 2021 and 2022 based on lower commodity prices, lower coal revenue as the operator converts to natural gas and the scheduled closure of the 777 mine. Adjusted operating cash flow reflected lower royalty revenues and higher interest and the timing of income taxes paid. Changes in total assets over the same periods reflects the growth of the Corporation's renewable royalty segment in addition to changes in investments and loans receivables offset by impairment losses on Pickett Mountain in 2023.

Lithium Royalty Corporation ("LRC")

In the first quarter of 2023 LRC, of which Altius was a co-founding investor, completed an initial public offering to raise $150,000,000 and during the second quarter Altius received $8,950,000 from LRC as a return of capital distribution to the pre-IPO shareholders of LRC. The Corporation holds an indirect 9.55% equity interest in LRC.

See 2022 section for additional information regarding LRC.

Altius Renewable Royalties Corp.

During the year ended December 31, 2023 US$15,950,000 ($21,222,000) was invested by ARR into its joint venture, GBR. These amounts were used to fund ARR's 50% of renewable royalty investments. During the year ended

Disclaimer

Altius Minerals Corporation published this content on March 25, 2025, and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on March 25, 2025 at 20:36:36.626.