Trilogy Metals Announces Execution of Definitive Agreements for Strategic Equity Investment by the U.S. Department of War

Trilogy Metals Inc. (NYSE American: TMQ) (TSX: TMQ) announced today that it has executed definitive agreements with the U.S. Department of War (the " DOW " or " U.S. Government ") in connection with the previously announced strategic equity investment of approximately US$35.6 million to advance exploration and development of the Upper Kobuk Mineral Projects (" UKMP ") in northwestern Alaska.

The UKMP is held by Ambler Metals LLC (" Ambler Metals "), the Company's 50/50 joint venture with South32 Limited (ASX, LSE, JSE: S32; ADR: SOUHY) ( "South32" ). The execution of the definitive documentation reflects the terms of the transaction previously announced by the Company and marks the final major step ahead of closing.

Subject to the satisfaction or waiver of customary closing conditions, the Company expects the transaction to close in September 2026.

Summary of the Transaction Under the definitive agreements, and consistent with the terms previously announced:

U.S. Government Investment in Trilogy Metals: The DOW will invest approximately US$17.8 million in Trilogy Metals in exchange for 8,215,570 units at a price of US$2.17 per unit, with each unit comprising one common share of Trilogy Metals and three-quarters (3/4) of a 10-year warrant.

Each full warrant will be exercisable at an exercise price of US$0.01 to acquire one common share of Trilogy following the earlier of (i) the completion of Phase 1 of the Ambler Access Project (or " Ambler Road ") or (ii) a change of control of the Company.

The entire proceeds received by Trilogy Metals will be reinvested in Ambler Metals.

U.S. Government Investment through South32: The DOW will pay approximately US$17.8 million to South32 in exchange for 8,215,570 common shares of Trilogy Metals that South32 currently holds, together with a 10-year call option to acquire an additional 6,161,678 common shares of Trilogy Metals from South32 at a price of US$0.01 per share, exercisable following the earlier of (i) the completion of Phase 1 of the Ambler Road or (ii) a change of control of the Company.

The entire proceeds received by South32 will be reinvested in Ambler Metals.

DOW Ownership: Upon completion of the transaction, the DOW will hold approximately 10% of Trilogy Metals, on a non-diluted basis.

Use of Proceeds: Trilogy Metals and South32 have committed to use the funds to explore and develop the UKMP.

Board Representation: The DOW will have the right to designate one independent third-party director to the board of directors of Trilogy Metals until October 6, 2028, and, for so long as it holds at least 8,000,000 common shares, to appoint a non-voting board observer.

Indebtedness Covenant: From closing until the earlier of (i) January 1, 2029 and (ii) any change of control of the Company, Trilogy Metals has agreed not to incur obligations with respect to third-party indebtedness for borrowed money in excess of US$1 billion in the aggregate without the prior written approval of the DOW.

Pre-Closing Milestones Completed The execution of definitive agreements follows the completion of the key milestones required to finalize the investment, including:

FOCI Review Completed: The U.S. Government has completed its Foreign Ownership, Control or Influence (" FOCI ") risk assessment of Trilogy Metals.

Authorization by U.S. Congress: The U.S. Congress has authorized, continued authorization and/or reauthorized the relevant authorities.

Tony Giardini, President and Chief Executive Officer of Trilogy Metals, commented: "The execution of these definitive agreements is a defining milestone for Trilogy Metals and for building a secure, domestic supply of critical minerals for America in Alaska. Having finalized the transaction documents to the standard this landmark investment deserves, we're pleased to be positioned to close on this financing from ..."