MEDALLION METALS LIMITED. — Capital/Financing Update 2021

May 20, 2021

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21 May 2021

ASX:MM8

RAV8 Nickel Project divestment

Highlights

• Medallion to divest prospective nickel ground holding to Australasian Mining Limited

• Medallion to receive 15,713,662 AML shares as consideration for the sale of tenure and mineral rights

• The transaction comprises outright sale of mineral tenements and grant of nickel, cobalt and PGM rights over tenure coincident with the Bandalup Ultramafics

• Australasian Mining Limited intends to be renamed Nickel28 Limited and seek to list on the ASX before the end of 2021, creating a new Western Australian based nickel exploration company

• Medallion to consider allocating Nickel28 Limited shares to shareholders via an in-specie distribution at the completion of any ASX imposed escrow period, subject to all regulatory approvals

• Sharpened focus on gold-copper discovery at the Ravensthorpe Gold Project

Medallion Metals Limited (ASX:MM8, the “Company” or “Medallion”) is pleased to report that it has entered into a Sale and Purchase Agreement (“SPA”) and Mineral Rights Agreement (“MRA”) (together, the “Agreements”) to divest the RAV8 Nickel Project (“RAV8”) and certain mineral rights over select tenure to a subsidiary of Australasian Mining Limited ("AML") in exchange for 15,713,662 AML shares. AML intends to be renamed Nickel28 Limited ("Nickel28") and is making preparations to list on the ASX during 2021. Nickel28 will seek to raise a minimum of $6.0 million via an Initial Public Offer (“IPO”) of its shares. If Nickel28 is successful in raising the minimum amount, Medallion will hold 18.69% of the issued shares at listing (which shareholding will be diluted to the extent more than $6.0 million is raised under the IPO). Nickel28 IPO shares are proposed to be issued at $0.20 per share which would value Medallion’s shareholding at $3.14 million. Medallion may terminate the Agreements if Nickel28 has not gained conditional approval for admission to the official list of the ASX within one year of execution of the Agreements.

AML is an unlisted public company and the legal and beneficial owner of 6 Mining Leases and 1 Exploration Licence which are coincident with the Bandalup Ultramafic belt, situated between the Company’s flagship Ravensthorpe Gold Project (“RGP”) and First Quantum Minerals Limited's Ravensthorpe Nickel Operation ("RNO") (Figure 1). The area was the subject of extensive nickel sulphide exploration activities by Western Mining Corporation and Pickands Mather International during the 1960s and 70s when the "RAV" series of prospects were delineated. The RAV8 deposit was the only one of the RAV prospects commercialised, producing 458,871t @ 3.46% nickel for 15,865t of contained nickel metal between 2000 and 2007. In addition to nickel sulphide prospectivity, the area is also prospective for large nickel laterite deposits, as evidenced by the Halleys, Hale-Bopp and Shoemaker-Levy orebodies currently being mined or developed as part of RNO.

Under the terms of the Agreements, Medallion will transfer ownership of M74/13 (RAV8) and E74/657 to AML. In addition, Medallion will grant AML mineral rights for nickel, cobalt and platinum group metals (“PGMs”), being platinum, palladium, ruthenium, rhodium, osmium and iridium over the following tenements; M74/83, E74/656, E74/638, E74/602 and E74/683 (pending grant). Medallion will retain the rights to all other minerals on these

Medallion Metals Limited Suite 1/11 Ventnor Ave, West Perth WA 6005

www.medallionmetals.com.au ABN 89 609 225 023

ASX Announcement

Medallion Metals Ltd

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tenements which in part straddle the Annabelle Volcanics which are prospective for Kundip style high grade gold-copper deposits. The Agreements are subject to terms and conditions customary for a transaction of this nature. Summary terms and conditions of the Agreements are provided as Annexure 1.

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Figure 1: Medallion, AML and Agreements tenure overlaid on regional geology

The consolidated tenure, the subject of the Agreements, will straddle a significant portion of both the eastern and western limbs of the Bandalup Ultramafic belt. It will be referred to as the Carlingup Nickel Project ("Carlingup" and "the Project") (Figure 2). Medallion’s rationale for entering the proposed transaction with AML

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ASX Announcement

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is that Carlingup’s significant exploration potential is best realised under the direction of a dedicated management team with the requisite technical and financial resources to maximise the value of the Project. Additionally, a transaction that separates the nickel opportunity from the Company’s portfolio will sharpen Medallion’s focus on its flagship Ravensthorpe Gold Project where a 32,000m drill program is well underway.

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Figure 2: Proposed Nickel28 consolidated mineral rights over regional magnetics

AML is significantly advanced in its preparation for the proposed IPO, having appointed Discovery Capital Partners Pty Ltd ("Discovery") as Corporate Advisor and Lead Manager. As a condition to the Agreements, Medallion will be entitled to nominate a Non-executive Director to the Board of AML and retain that position for as long as the Company holds ten per cent or more of the issued and outstanding shares of AML/Nickel28.

Medallion will give consideration to transferring ownership of AML/Nickel28 shares to Medallion shareholders via an in-specie distribution upon the conclusion of any escrow period imposed by ASX, subject to all necessary regulatory approvals. The Company will keep shareholders informed of transaction milestones and AML’s progress toward listing on the ASX and becoming a new Western Australian nickel explorer with assets in a proven and highly prospective nickel terrain.

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ASX Announcement

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Managing Director, Paul Bennett, commented:

“This is a great outcome for Medallion shareholders. The prospective nickel ultramafics east of RGP are often overlooked, and we’re pleased to be working with the AML team to consolidate the tenure and bring investment to bear on an area proven to host high-grade nickel sulphides. In addition to maximising the value of the ultramafics for Medallion shareholders, a transaction will further sharpen our focus on the gold and copper at RGP, where a 32,000m drill program is well underway with first assay results expected this month.”

This announcement is authorised for release by the Board of Medallion Metals Limited.

-ENDS-

For further information, please visit the Company's website www.medallionmetals.com.au or contact:

Paul Bennett Managing Director Medallion Metals Limited Phone: +61 8 6424 8700 Email: info@medallionmetals.com.au Suite 1, 11 Ventnor Avenue, West Perth WA 6005

DISCLAIMER

References in this announcement may have been made to certain ASX announcements, including exploration results, Mineral Resources and Ore Reserves. For full details, refer said announcement on said date. The Company is not aware of any new information or data that materially affects this information. Other than as specified in this announcement and mentioned announcements, the Company confirms it is not aware of any new information or data that materially affects the information included in the original market announcement(s), and in the case of estimates of Mineral Resources and Ore Reserves, that all material assumptions and technical parameters underpinning the estimates in the relevant announcement continue to apply and have not materially changed. The Company confirms that the form and context in which the Competent Person’s findings are presented have not been materially modified from the original announcement.

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ANNEXURE 1:

Sale and Purchase Agreement

• Transaction: Medallion to divest to AML subsidiary M74/13 and E74/657, specified mineral rights on M74/83, E74/656 E74/638 E74/602 and E74/683 (under the Mineral Rights Agreement specified below), project information (relating to the tenements and the mineral rights) and freehold land being lot 65 on deposited plan 415321.

• Consideration: 32.5% of the shares on issue in AML immediately before its pre-IPO seed raising at a deemed issue price of $0.20 per share – currently expected to be approximately 15,713,662 AML Shares.

• Conditions : The transaction is subject to a number of conditions precedent customary for an agreement of this nature including without limitation the following material conditions – AML completing an $800,000 seed raising at 14 cents per share, AML obtaining conditional approval to list on ASX and approval by the Foreign Investment Review Board in relation to Medallion’s acquisition of the consideration shares.

• Escrow: the consideration shares will be subject to ASX escrow and a voluntary escrow period of 12 months from quotation.

• Board Nominee: Medallion will be entitled to have one nominee director on the board of directors of the AML until such time as Medallion’s shareholding in AML falls below 10%.

• Other terms and conditions: Both parties provide each other a number of warranties and indemnities customary for an agreement of this nature.

Mineral Rights Agreement

• Grant of Rights: Subject to completion occurring under the Sale and Purchase Agreement, an AML subsidiary will be granted a sub-license to explore for nickel, cobalt and platinum group metals (being platinum, palladium, ruthenium, rhodium, osmium and iridium) on M74/83, E74/656, E74/638, E74/602 and E74/683 (pending grant). Medallion will retain the rights for all other minerals.

• Payment of Expenditure : Medallion will pay 100% of rents and rates on the tenements and the AML subsidiary will pay 50% of the expenditure obligations on tenements for the first 2 years thereafter 100%.

• Discovery : After making a discovery that meets certain criteria (including to become a mining operation) a mining lease will be applied for over the discovery area will be registered in the name of, or transferred to be in the name of, the mining party. The non-mining party’s rights to explore for relevant minerals in relation to the mining lease or discovery area will cease in exchange for a 50% royalty payable on the minerals to which their rights have ceased.

• Indemnities : Each party indemnifies the other from claims relating to loss caused or contributed by the other party and their personnel.

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