LunR Royalties to Acquire a Life-of-Mine Silver Stream on the Fruta Del Norte Mine for $670 Million

Executive Summary

• LunR Royalties entered into a binding term sheet to acquire a life‑of‑mine (LOM) silver stream on Lundin Gold’s Fruta Del Norte mine for an estimated $670 million in consideration.
• Consideration will be paid with ~50.5 million LunR shares (valued at $670 M based on a C$18.18 VWAP), which Lundin Gold will distribute to its shareholders as a dividend‑in‑kind.
• The transaction, expected to close in Q2 2026, will give LunR 100% of payable silver production until 12.2 Moz, then stepped down to 50% and finally 7.5%, providing immediate cash flow and long‑term exposure to a Tier‑1 gold‑silver asset.

Key Details

• Consideration: ~50,505,051 LunR shares (~$670 M) based on 20‑day VWAP of C$18.18 (Feb 20 2026).
• Delivery Structure:
• 100% of payable silver until 12,200,000 oz delivered (First Dropdown).
• 50% of payable silver for the next 7,800,000 oz (Second Dropdown).
• 7.5% thereafter for the remainder of the LOM.
• Payment Terms: LunR will pay 10% of spot silver price up to First Dropdown, 20% up to Second Dropdown, and 30% thereafter.
• Effective Date & Closing: Stream effective March 1 2026; closing targeted for Q2 2026, subject to due diligence, definitive agreements, TSXV and shareholder approvals (MI 61‑101).
• Impact on LunR:
• Adds immediate cash flow from silver production (≈500–600 k oz payable in 2026).
• Positions LunR as a “precious‑metals weighted” royalty/streaming company, potentially the sixth‑largest globally post‑closing.
• Introduces Newmont Corp. (~32% Lundin Gold holder) as a major shareholder (>10% of LunR) and board representative.
• Fruta Del Norte Mine Highlights:
• Forecast 2026 production: 475–525 k oz gold; 500–600 k oz payable silver.
• Proven & Probable reserves: 5.8 Moz gold, 8.9 Moz silver; Measured & Indicated resources: 7.5 Moz gold, 11.7 Moz silver.
• Ongoing mill expansion and exploration programs aimed at increasing silver output and discovering additional copper‑gold‑silver porphyry deposits.
• Regulatory/Shareholder Approvals: Requires MI 61‑101 shareholder approval at a special meeting, TSXV consent, and issuance of a short‑form prospectus for the share distribution.
• Advisors & Opinions: BMO Capital Markets provided a fairness opinion confirming the consideration is fair to LunR.

Notable Quotes

“This is a transformational acquisition that will provide LunR with significant cash flow upon closing, and long‑term exposure to a high‑quality precious metals asset.” – Adam Lundin, President, CEO & Chair, Lundin Gold.