Dr. Stephen Twyerould reports

EXCELSIOR MINING ANNOUNCES EXTENSION OF NEBARI LOAN AND US$5,500,000 FINANCING

Excelsior Mining Corp. and its wholly owned subsidiary Excelsior Mining Arizona Inc. have agreed with Nebari Natural Resources Credit Fund I LP to extend the maturity date of its existing $15-million credit facility to June 30, 2026. In addition, the company has entered into agreements for a $5.5-million financing with Greenstone and Triple Flag. All dollar amounts in this press release are in United States dollars.

Dr. Stephen Twyerould, president and chief executive officer of Excelsior, commented: "We are very pleased with the support from Nebari, Greenstone and Triple Flag for the execution of the company's development and operating strategy. The loan extension and funding will allow Excelsior the runway to advance the Nuton option on the Johnson Camp mine and complete the preparation for the well stimulation program."

Credit agreement extension

The company, Excelsior Arizona and Nebari have entered into a third amendment to the amended and restated credit agreement (the third amended ARCA). The third amended ARCA provides for the extension of the maturity date of the existing $15-million credit facility to June 30, 2026. Nebari has also agreed to reduce the interest rate (the rate reduction) to 10.5 per cent plus a rate supplement equal to the greater of (i) the forward-looking secured overnight financing rate (administered by CME Group Benchmark Administration Ltd. or a successor administrator) for a tenor of three months and (ii) 1.50 per cent.

As consideration for the third amended ARCA as it relates to the extension and rate reduction, subject to Toronto Stock Exchange approval, the company is required to issue common shares of the company to nominees of Nebari in a number equal to $1,050,224 (U.S.), converted to Canadian dollars at an exchange rate equal to the average market rate posted by the Bank of Canada for the five days preceding the issuance, divided by 15.5 Canadian cents (11.405 cents). This amount includes a cash extension bonus plus an amount equal to the total additional amount of interest that would have been payable to the maturity date of the credit facility prior to the rate reduction.

In addition the early amortization of the credit facility has been extended such that the company will begin amortizing the principal amount of the facility (and pro rata repayment bonus amount that already exists under the credit facility) in monthly instalments payable on the last day of each month of (i) commencing June, 2024, to and including December, 2024, seven equal monthly instalments of $206,000.00; (ii) commencing January, 2025, to and including December, 2025, 12 equal monthly instalments of $257,500.00; and (iii) commencing January, 2026, to June, 2026, six equal monthly instalments of $309,000.00.

The third amended ARCA is subject to certain conditions including completion of the financing by Dec. 31, 2023, conclusion of certain agreements with Triple Flag international Ltd. and the approval of the Toronto Stock Exchange.

Financing

To satisfy the condition to complete the financing under the third amended ARCA, the company has agreed to a transaction with Triple Flag and Greenstone Excelsior Holdings LP on the following terms: (i) Greenstone shall sell 1.5 per cent of its total 3-per-cent gross revenue royalty on the Johnson Camp mine to Triple Flag for consideration of $5.5-million in cash (the royalty sale); and (ii) Greenstone will concurrently complete a $5.5-million financing with the company that consists of $3.1-million in common shares and $2.4-million principal amount of convertible debentures.

Pursuant to the share offering, the company shall issue Greenstone a total of 27.18 million common shares at a price of 11.405 cents (15.5 Canadian cents) per common share for aggregate gross proceeds of $3.1-million.

Pursuant to the debenture offering, Greenstone will subscribe for a total of $2.4-million principal amount of convertible debentures. The terms of the debentures include:

• A maturity date of Sept. 30, 2026, and the principal amount, together with any accrued and unpaid interest, will be payable on the maturity date, unless earlier converted in accordance with their terms.
• The debentures bear interest at the rate of 10.5 per cent per annum plus the rate supplement, which interest will be payable on the maturity date, unless earlier converted into common shares.
• Subject to the receipt of disinterested shareholder approval from the holders of the common shares at a duly and validly call meeting, the principal amount of the debenture is convertible into common shares at the option of the holder (or at the option of the company on 30 days prior notice) at a conversion price of 11.405 cents per common share.
• Subject to receipt of the shareholder approval, the accrued and unpaid interest is convertible into common shares at a conversion price equal to the volume weighted average trading price on the Toronto Stock Exchange for the five trading days prior to the date of conversion.
• The debentures are unsecured.

The company intends to use the proceeds of the share offering and debenture offering for project development expenses and working capital. The closing of the share offering and debenture offering is subject to customary conditions, including the approval of the Toronto Stock Exchange.

Additional information

Nebari and Triple Flag are at arm's length to the company. There are no commissions or finders' fees payable in connection with the transactions discussed in this news release. There is no assurance that the conditions to the third amended ARCA or closing of the royalty sale, share offering or debenture offering will be satisfied.

Greenstone and its affiliated entities currently hold 116,028,937 common shares (representing 41.86 per cent of the company's current issued and outstanding common shares). Greenstone also owns and controls 1.25 million options to acquire common shares and a convertible debenture with principal amount of $1.5-million that is convertible into 7,894,736 common shares. Upon closing of the debenture offering and conversion of the debentures held by Greenstone (assuming conversion of all interest payments on the maturity date, using a conversion price of 11.405 U.S. and a SOFR (secured overnight financing rate) rate of 5.3307 per cent), Greenstone would acquire ownership and control over an additional 57,383,369 common shares, representing approximately 20.7 per cent of the company's current issued and outstanding common shares. As a result, together with the common shares it currently owns and controls, Greenstone would hold a total of 173,412,306 common shares, which will represent, in aggregate approximately 51.83 per cent of the issued and outstanding common shares (assuming conversion of only the debentures held by Greenstone and assuming the conversion of all interest to maturity at 11.405 cents).

Pursuant to Multilateral Instrument 61-101 -- Protection of Minority Security Holders in Special Transactions, Greenstone's participation in the debenture offering constitutes a related party transaction as Greenstone is a related party of the company. The company is relying on an exemption from the formal valuation and minority shareholder approval requirements of MI 61-101 pursuant to exemptions contained in sections 5.5(a) and 5.7(1)(a) of MI 61-101 on the basis that at the time Greenstone's participation in the debenture offering was agreed to, neither the fair market value of the securities to be distributed in the debenture offering nor the consideration to be received for those securities, insofar as the debenture offering involved the related party, exceeds 25 per cent of the company's market capitalization. The company will not file a material change report related to this financing more than 21 days before the expected closing of the debenture offering as required by MI 61-101 since the details of the participation by the related parties of the company were not settled until just prior to closing and the company wished to close on an expedited basis for sound business reasons. The common shares that will be acquired by Greenstone will be acquired pursuant to an exemption from the prospectus requirement in Section 2.3 of National Instrument 45-106.

In order to facilitate the completion of the royalty sale, share offering and debenture offering, the company will first acquire the 1.5-per-cent gross revenue royalty on the Johnson Camp mine from Greenstone in return for the common shares and debenture and then transfer the royalty to Triple Flag for $5.5-million in cash. Also, a further condition of the third amended ARCA, the holders of the $3-million principal amount of convertible debentures issued by the company in February, 2023, have agreed to extend the maturity date of such convertible debentures to Sept. 30, 2026.

Other activities in the company remain on track and on budget. Refer to the Oct. 23, 2023, press release for additional information.

About Excelsior Mining Corp.

Excelsior, the copper solution company, is a mineral exploration and production company that owns and operates the Gunnison copper project in Cochise county, Arizona. The project is a low-cost, environmentally friendly in situ recovery copper extraction project that is permitted to 125 million pounds per year of copper cathode production. Excelsior also owns the past-producing Johnson Camp mine and a portfolio of exploration projects, including the Peabody sill and the Strong and Harris deposits.

Excelsior has entered into an agreement with Nuton LLC, a Rio Tinto venture, to further evaluate the use of its Nuton copper heap leaching technologies at Excelsior's Johnson Camp mine in Cochise county, Arizona. Under the agreement, Excelsior remains the operator and Nuton finances Excelsior's costs associated with a two-stage work program at Johnson Camp. Nuton has provided a $3-million (U.S.) prepayment to Excelsior for stage 1 costs and a payment of $2-million (U.S.) for an exclusive option to form a joint venture with Excelsior over the Johnson Camp mine after the completion of stage 2. If Nuton proceeds to stage 2, it will make a $5-million (U.S.) payment to Excelsior for the use of existing infrastructure at the Johnson Camp mine for the stage 2 work program. Nuton will also be responsible for funding all of Excelsior's costs associated with stage 2.

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