Talon Metals — M&A Activity 2025

Dec 29, 2025

Form 51-102F3
Material Change Report

Item 1 Name and Address of Company
Talon Metals Corp. ("Talon" or the "Company")
Craigmuir Chambers
P.O. Box 71
Road Town, Tortola, VG1110
British Virgin Islands

Item 2 Date of Material Change
December 18, 2025

Item 3 News Release
The news release with respect to the material change referred to in this report was disseminated via Newsfile on December 18, 2025, and subsequently filed on SEDAR+.

Item 4 Summary of Material Change
On December 18, 2025, the Company entered into a share purchase agreement (the "Share Purchase Agreement") with Lundin Mining Corporation ("Lundin Mining"). The Share Purchase Agreement provides for a transaction (the "Transaction") that will result in the combination of Lundin Mining's producing Eagle Mine and associated Humboldt Mill with Talon's interest in the Tamarack Nickel-Copper-Cobalt Project and a prospective exploration land package of over 400,000 acres in Michigan, which includes the Boulderdash nickel/copper discovery 8-miles from the Eagle Mine, and Talon's proposed North Dakota Beulah Minerals Processing Facility.

Pursuant to the terms of the Share Purchase Agreement, Talon will acquire 100% of the outstanding shares of Lundin Mining US Ltd. ("Lundin SubCo"), a wholly-owned subsidiary of Lundin Mining, which owns the Eagle Mine and Humboldt Mill, in exchange for: (i) 275,152,232 common shares of Talon ("Talon Shares") which will result in Lundin Mining increasing its interest in Talon from 1.57% to 19.99% of the outstanding Talon Shares on a non-diluted basis, based on the number of Talon Shares that are issued and outstanding as of the date of the Share Purchase Agreement (and assuming the issuance of Talon Shares pursuant to the Concurrent Private Placement (defined below)); and (ii) the grant of a production payment royalty (the "Production Payment Royalty") on ore from sources other than the Eagle Mine that is processed through the Humboldt Mill at a rate of US$1.00 per tonne, up to a maximum aggregate payment of US$20.0 million, representing 20 million tonnes of ore.

Item 5.1 Full Description of Material Change
On December 18, 2025, the Company entered into the Share Purchase Agreement which provides for the Transaction. Pursuant to the terms of the Share Purchase Agreement, Talon will acquire 100% of the outstanding shares of Lundin Subco in exchange for: (i) 275,152,232 Talon Shares which will result in Lundin Mining increasing its interest in Talon from 1.57% to 19.99% of the outstanding Talon Shares on a non-diluted basis, based on the number of Talon Shares that are issued and outstanding as of the date of the Share Purchase Agreement (and assuming

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the issuance of Talon Shares pursuant to the Concurrent Private Placement); and (ii) the Production Payment Royalty.

The Share Purchase Agreement also provides that, concurrently with closing of the Transaction, Talon and Lundin Mining will enter into an investor rights agreement (the "Investor Rights Agreement") and a lock-up agreement (the "Lock-Up Agreement"). The Investor Rights Agreement will provide Lundin Mining with certain board nomination rights, as well as participation rights in respect of future equity issuances by Talon to allow it to maintain its ownership interest, for so long as Lundin Mining has beneficial ownership of at least 10% of the Talon Shares. The Lock-Up Agreement will provide for limitations on sales of Talon Shares by Lundin Mining during the two-year period following the date of the Lock-Up Agreement. The Lock-Up Agreement will also provide that Lundin Mining will not acquire beneficial ownership of more than 19.99% of the Talon Shares during the one-year period following the date of the Lock-Up Agreement, subject to certain exceptions.

In addition, Lundin Mining has agreed to maintain and bear the cost of all financial assurances provided in respect of mining and reclamation operations of the Eagle Mine and Humboldt Mill until the board of directors of Talon (the "Talon Board") makes a "Positive Final Investment Decision" in respect of developing a mine on any of Talon's properties, provided that Talon uses commercially reasonable efforts to amend or replace such financial assurances.

Director and Officer Changes

At closing of the Transaction, the Talon Board will be reconstituted to consist of ten directors, including Jack Lundin and Juan Andrés Morel, the CEO and COO, respectively, of Lundin Mining and seven of the eight directors currently on the Talon Board. Darby Stacey, the current Managing Director of Eagle Mine, will be appointed to the Talon Board and appointed as CEO of Talon, overseeing the operations of the combined assets, with Henri van Rooyen being appointed Executive Chairman. On closing of the Transaction, Warren Newfield will be stepping down from the Talon Board and as Executive Chairman of Talon.

Concurrent Private Placement

Concurrently with the signing of the Share Purchase Agreement, Talon signed a subscription agreement with a trust settled by the late Adolf H. Lundin (the "Lundin Family Trust") pursuant to which the Lundin Family Trust agreed to purchase 18,555,783 Talon Shares, at a price of C$0.4194 per Talon Share, which is the deemed value of the Talon Shares to be issued to Lundin Mining in connection with the Transaction, on a private placement basis for gross proceeds of approximately C$7.8 million or US$5.6 million (the "Concurrent Private Placement").

The gross proceeds of the Concurrent Private Placement will be used to fund transition costs, due diligence costs, acquisition costs, and integration costs.

The Concurrent Private Placement is expected to close concurrently with the closing of the Transaction. It is also expected that Talon and the Lundin Family Trust will enter into an agreement in connection with the closing of the Concurrent Private Placement that provides the Lundin Family Trust with a contractual right in respect of future equity offerings by Talon, so it has the ability to maintain its ownership interest in Talon.

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Share Consolidation

Under the terms of the Share Purchase Agreement, Talon agreed to complete a consolidation of the Talon Shares (the "Consolidation") as soon as practicable after the closing of the Transaction. The Consolidation would be on the basis of one post-consolidation Talon Share for every ten pre-consolidation Talon Shares, as approved by the shareholders of Talon at the annual and special meeting of shareholders held on June 25, 2025. The Talon Board has approved the Consolidation and the date the Talon Board has determined to implement the Consolidation will be announced in connection with closing of the Transaction, together with additional details about the Consolidation.

Additional Transaction Details

The Transaction and the Concurrent Private Placement are anticipated to close in early January, subject to the approval of the Toronto Stock Exchange, as well as the satisfaction or waiver of other customary closing conditions.

Further information regarding the terms of the Transaction are set out in the Share Purchase Agreement, which has been publicly filed by the Company under its SEDAR+ profile at www.sedarplus.ca.

Item 5.2 Disclosure for Restructuring Transactions

Not applicable.

Item 6 Reliance on Subsection 7.1(2) of National Instrument 51-102

Not applicable.

Item 7 Omitted Information

Not applicable.

Item 8 Executive Officer

For further information, contact Mike Kicis, at 1 (647) 968-0060.

Item 9 Date of Report

December 29, 2025

Forward-Looking Statements

This material change report contains certain "forward-looking statements". All statements, other than statements of historical fact that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future are forward-looking statements. These forward-looking statements reflect the current expectations or beliefs of the Company based on information currently available to the Company. Such forward-looking statements include statements relating to the Transaction and Concurrent Private Placement, including the impact and anticipated benefits of the Transaction; the anticipated timing of the completion of the Transaction and the Concurrent Private Placement; the grant of the Production Payment Royalty, entering into the Investor Rights Agreement, the Lock-Up Agreement, and the

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agreement in connection with the Concurrent Private Placement, and the terms thereunder, and the timing thereof; changes to the Talon Board; the use of proceeds of the Concurrent Private Placement; and implementing the Consolidation and the effective date thereof. Forward-looking statements are subject to significant risks and uncertainties and other factors that could cause the actual results to differ materially from those discussed in the forward-looking statements, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on the Company.

Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Although the Company believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.

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