Franco-Nevada and Discovery Silver: A Strategic Partnership for Gold Production Growth

Franco-Nevada Corporation ("Franco-Nevada") has announced a comprehensive financing package with Discovery Silver Corporation ("Discovery") to support its proposed acquisition of the Porcupine Complex located near Timmins, Ontario from Newmont Corporation. This strategic partnership aims to add another cash-flowing gold asset to Franco-Nevada's portfolio while providing Discovery with the necessary funds to acquire the Porcupine Complex and fund its planned capital program. The financing package includes a 4.25% net smelter return royalty ("Royalty") for $300M, a $100M senior secured term loan ("Loan"), and approximately $49M of equity participation with a cornerstone investment in a concurrent C$225M (approximately $155M) Discovery equity raise.

The Royalty will add immediate gold revenues from a well-established operating complex in Ontario, expanding Franco-Nevada's industry-leading royalty coverage of many of Ontario's most significant gold mines and deposits. Discovery has prepared a technical report outlining a mine plan for the Hoyle Pond, Borden, and Pamour mines, which are expected to produce approximately 285 koz Au on average over the next 10 years and a total of approximately 4.9 Moz Au over a 22-year mine life. The Royalty expands Franco-Nevada's exposure to the gold mining sector and provides investors with gold price and exploration optionality while limiting exposure to cost inflation.

Discovery is led by Tony Makuch, who has extensive history operating in the Timmins camp and a proven track record of optimizing operations. The Discovery team is uniquely suited to operate, optimize, and explore these assets, with a deep understanding of the Timmins Camp and the many opportunities that exist to discover new resources, build reserves, expand production, and mine life, and lower costs at the existing operations. Discovery has identified several opportunities to increase production over and above the profile in the technical report, including expanding the Pamour open pit, increasing underground throughput at the Hoyle Pond and Borden mines, increasing the throughput of the Dome mill, and developing the Dome open pit project.

The Porcupine Complex has extensive mineral resources, presenting compelling upside potential through exploration. The large land position in one of the world's most prolific gold mining regions could lead to new discoveries, building reserves, and expanding production. The acquisition of the Porcupine Complex by Discovery Silver aligns with Franco-Nevada's long-term investment strategy by providing diversification, growth, exposure to an experienced management team, significant expansion potential, established infrastructure, and alignment with Franco-Nevada's royalty and streaming business model.



In conclusion, the strategic partnership between Franco-Nevada and Discovery Silver on the Porcupine Complex presents an attractive opportunity for both companies. Franco-Nevada gains exposure to a well-established gold mining operation in Ontario, while Discovery receives the necessary funds to acquire the Porcupine Complex and execute its planned capital program. With an experienced management team and significant expansion potential, the Porcupine Complex is well-positioned to become a Tier 1 mining asset in the gold space, operated with an overriding commitment to responsible mining and sustainability.