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  • TSX-V: CMIL
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Tumad Agreement

On Sept. 2, 2025, Capella Minerals Ltd. announced that it had signed a Definitive Agreement with Turkish mining company, Tümad Madencilik Sanayi Ve Ticaret A.S., with respect to a staged earn-in proposal for the Company's portfolio of precious and base metal projects in Northern Finland and Norway. The Definitive Agreement contemplates an on-signing cash payment to Capella and mandatory Year 1 work commitments - including the completion of up to 4,000m of drilling on the Northern Finland project and up to 8,000m of drilling on the Norwegian projects for a 30% interest in Capella's holding in the respective project. After the completion of Year 1, Tümad retains the option to either continue investing in exploration (and thereby increasing its interest in the respective project(s)) or reverting to a Net Smelter Royalty (NSR) on projects in each country that it decides not to continue with. Further details of the Tümad earn-in agreement are provided in the Company News Release dated June 2, 2025. Turkish mining company, Tümad Madencilik Sanayi Ve Ticaret A.S. ("Tümad"), with respect to a staged earn-in proposal for the Company's portfolio of precious and base metal projects in Scandinavia. Under the terms of the Agreement, Tümad will have the exclusive option to earn-in to majority interests in Capella's Norwegian copper-cobalt-zinc projects and Finnish gold-copper projects through a series of exploration and development investments. Tümad currently produces approximately 200,000 ounces of gold per annum from two mining operations located in western Türkiye. This strategic partnership with Capella is expected to provide Tümad with an excellent opportunity to expand its international footprint into the highly prospective Scandinavian region.

Highlights

Key terms of the Capella – Tümad Agreement are as follows:

  • Tümad will make a cash payment to Capella of USD 50,000 upon signing of the LOI. Furthermore, Tümad will make cash payments to Capella of USD 250,000 each for the Norwegian and Finnish projects upon execution of the Definitive Agreements for both projects.
  • With respect to the Company's 100%-owned Norwegian copper-cobalt-zinc projects (Hessjøgruva/Kongensgruve, Kjeldebotn, and Kviteseid), Tümad would be granted an earn-in on the following terms:
    • Phase 1 (Earn-in to 30% shareholder of the license holder company) – Tümad will be required to invest USD 2,500,000 in exploration expenditures (including a minimum 8,000m of core drilling) during the First Year after the signing of the Definitive Binding Agreement. This investment is deemed to be the minimum investment commitment. Should Tümad then elect not to continue on to Phase 2, Tümad's interest in the project will revert to a 1% NSR.
    • Phase 2 (Earn-in to 51% shareholder of the license holder company)(Optional) – Tümad will be required to invest a further USD 5,000,000 in exploration expenditures, which is expected to include the completion of a further 15,000m of infill / step-out drilling, a Canadian NI 43-101 compliant mineral resource estimate, plus initial metallurgical and mining studies.
    • Phase 3 (Earn-in to 80% shareholder of the license holder company)(Optional) – funding of all studies required for completion of a 43-101 compliant Feasibility Study.
    • Subsequent to the completion of Phase 3, Capella will either be required to contribute to future exploration and development costs on a pro-rata basis or will dilute out to a 1.5% NSR. Tümad will hold a buy-back right on the 1.5% NSR for USD 5,000,000 until anytime up to the commencement of commercial production.
  • With respect to the Company's Northern Finland gold-copper projects (Killero E, Killero W, Saattopora W, Jolhikko, and Selsunselka)(Cullen Joint Venture; ASX: CUL), Tümad has been granted an earn-in on the following terms:
    • Phase 1 (Earn-In to 30% shareholder of the license holder company) – Tümad will be required to invest USD 1,250,000 in exploration expenditures (including a minimum 4,000m of core drilling) during the First Year after the signing of the Binding Agreement. This investment is deemed to be the minimum investment commitment. Should Tümad then elect not to continue on to Phase 2, Tümad's interest in the project will revert to a 1% NSR.
    • Phase 2 (Earn-in to 51% shareholder of the license holder company)(Optional) – Tümad will be required to invest a further USD 2,500,000 in exploration expenditures, and which is expected to include an additional 8,000m of infill and step-out drilling.
    • Phase 3 (Earn-in to 80%*)(Optional) – funding of Feasibility-level technical studies
    • Subsequent to the completion of Phase 3, Capella will either be required to contribute to future exploration and development costs on a pro-rata basis or will dilute out to a 1.5% NSR. Tümad will hold a buy-back right on the 1.5% NSR for USD 5,000,000 until anytime up to the commencement of commercial production.

The Phase 1 investments indicated for both the Norwegian and Finnish projects are deemed mandatory, with further exploration being undertaken purely at Tümad's discretion and based on positive technical results. Should Tümad elect to withdraw from either project at the end of the First Year (Phase I), then it shall retain a 1% NSR on the project.

During the Period starting from Phase 1 and ending upon the completion of the Phase 3 Tümad will fund the exploration expenditures that will be outlined in the Definitive Binding Agreement, and the Projects will be operated jointly by Tümad and Capella, through technical committee overseeing work programs and budget allocations. Tümad will take a lead role in executing exploration programs, while Capella will contribute local expertise and regulatory and community engagement support.

*80% of Capella's interest in the license holder company