Lithium Royalty (LIRC) Investor Update summary

Transaction Overview

• Announced sale of a 0.5% gross overriding revenue royalty on Tres Quebradas Lithium Brine project in Argentina for $28 million cash to Triple Flag Precious Metals, retaining a 0.9% royalty on the project.

• Transaction is expected to close in Q1 2025, increasing pro forma cash balance to $34.4 million USD.

• Proceeds will be used for share repurchases, potentially via a Substantial Issuer Bid, and to pursue new royalty acquisitions.

• No cash tax payments are anticipated from this transaction, with after-tax proceeds expected to be approximately equal to the transaction value.

• Transaction strengthens the balance sheet, providing flexibility for share buybacks and new royalty acquisitions.

Strategic Rationale and Portfolio Impact

• Sale values the Tres Quebradas royalty at a premium to current share price, highlighting portfolio value and a value disconnect in public lithium asset valuations.

• Reduces single asset exposure from 22% to 16% of NAV, with Argentina exposure at 21% including Mariana.

• Enables portfolio rebalancing and prudent risk management by diversifying across jurisdictions and counterparties.

• Positions the company to capitalize on attractive lithium sector valuations at a cyclical low.

• Share buybacks estimated to deliver over 20% internal rate of return at current prices.

Growth Outlook and Capital Allocation

• Pipeline for new royalty acquisitions remains robust, with focus on near-term cash flow and strategic assets.

• Three new assets expected to contribute meaningful revenue growth in 2025: Tres Quebradas, Das Neves, and Mariana.

• Sigma's Phase II expansion at Grota do Cirilo set for production in H2 2025.

• Capital allocation will balance share repurchases and new royalty acquisitions, with flexibility to act as opportunities arise.

• Royalty model is scalable and low cost, supporting further acquisitions and buybacks.