Tacora Resources Inc. Selects Successful Bidder in Sale Process

TORONTO, ON / ACCESSWIRE / July 22, 2024 / Tacora Resources Inc. ("Tacora" or the "Company") today announced that it has selected a bid from Millstreet Capital Management LLC, as investment manager on behalf of multiple noteholders ("Millstreet"), OSP, LLC (on behalf of certain managed funds) ("OSP") (Millstreet and OSP are each holders of certain of the Company's senior secured notes and senior secured priority notes) and Cargill, Incorporated (collectively with any affiliates, "Cargill" and together with OSP and Millstreet, the "Investors") as the Successful Bid under its sale process (the "Sale Process"), as defined therein, conducted pursuant to, and in connection with, its proceedings (the "CCAA Proceedings") before the Ontario Superior Court of Justice (Commercial List) (the "Court") under the Companies' Creditors Arrangement Act (Canada) (the "CCAA").

Following the selection of the Investors as the Successful Bidder under the Sale Process and as defined therein, the Company and the Investors entered into a subscription agreement (the "Subscription Agreement") on July 21, 2024. The Subscription Agreement contemplates, among other things, an equity injection of up to US$250 million by the Investors, assumption of substantially all pre-filing and post-filing trade amounts (subject to payment terms and amounts to be agreed to by the Company and the Investors), the assignment of key contractual arrangements (subject to payment terms and amounts to be agreed to by the Company, the Investors and such third parties), full repayment of the DIP facility, and continued employment for all existing Tacora team members. It also contemplates a new Cargill offtake agreement that will allow Tacora to generate higher net realized revenue per tonne. The transactions contemplated by the Subscription Agreement will allow Tacora to significantly deleverage its balance sheet, provide new capital to execute on its long-term plan to upgrade and modernize the Scully Mine and to achieve the Company's objective of producing in excess of six million tonnes of high-grade iron ore concentrate per year. The Subscription Agreement contemplates a target closing date of August 30, 2024.

Heng Vuong, Tacora's Executive Vice President and Chief Financial Officer, said "the transactions announced today with the Investors represent a successful outcome for Tacora and its stakeholders. The transactions will allow Tacora to emerge from the CCAA Proceedings as a much stronger and better-capitalized business focused on achieving the full potential of the Scully Mine and provide employment for Labrador West for generations to come. We thank all Tacora team members, our suppliers, and other stakeholders for their resilience, continued support through the CCAA Proceedings and contributions to this successful outcome."

The Subscription Agreement and transactions thereunder remain subject to, among other things, Court approval. The Company intends to appear before the Court on July 26, 2024, or as soon as possible thereafter, to seek an order approving the Subscription Agreement and the transactions contemplated thereunder. A copy of the Sale Process, the Subscription Agreement and more information related to the CCAA Proceedings can be found on the Court-appointed Monitor's website at http://cfcanada.fticonsulting.com/Tacora. Information regarding the CCAA Proceedings can also be obtained by calling the Monitor's hotline at 1-833-420-9074 or by email at tacora@fticonsulting.com.

Advisors

Greenhill & Co. Canada Ltd., an affiliate of Mizuho, is serving as financial advisor and Stikeman Elliott LLP is serving as legal counsel to Tacora. FTI Consulting Canada Inc. is serving as Court-appointed Monitor and Cassels Brock & Blackwell LLP is serving as legal counsel to the Monitor. GLC Advisors & Co., LLC is serving as financial advisor and Osler, Hoskin & Harcourt LLP is serving as legal counsel to Millstreet and OSP. Jefferies Financial Group Inc. is serving as financial advisor and Goodmans LLP is serving as legal counsel to Cargill.

About Tacora Resources Inc.

Tacora is a private company that is focused on the production and sale of high-grade and quality iron ore products that improve the efficiency and environmental performance of steel making and, subject to final process verification and economic assessment, the development of a high purity manganese product for advanced battery technology. The Company owns and operates the Scully Mine, an iron ore concentrate producer located near Wabush, Newfoundland and Labrador, Canada with a production capacity of six million tonnes per year. Additional information about the Company is available at www.tacoraresources.com.

Forward Looking Statements

This press release contains statements that are forward-looking in nature and relate to our expectations, beliefs, and intentions. All statements other than statements of historical fact are statements that could be deemed to be forward-looking. Although Tacora believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements involve known and unknown risks, uncertainties and other factors and are not guarantees of future performance and actual results may accordingly differ materially from those in forward-looking statements, and these statements are subject to risks, uncertainties and assumptions that could cause outcomes to differ from our expectations, including risks related to the closing of the transactions contemplated by the Subscription Agreement. The forward-looking information set forth herein reflects Tacora's expectations as at the date of this press release and is subject to change after such date. Tacora disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Investor and Analyst Contact:

Heng Vuong
Executive Vice President and Chief Financial Officer
T - +1 (416) 704-8377
E - heng.vuong@tacoraresources.com

SOURCE: Tacora Resources Inc.