https://www.newswire.ca/news-releases/champion-iron-announces-the-closing-of-the-kami-project-acquisition-873172744.html

A high-grade project near the Company's operating Bloom Lake mine

MONTRÉAL, April 1, 2021 /CNW/ - Champion Iron Limited (TSX: CIA) (ASX: CIA) ("Champion" or the "Company") announces that it has completed the acquisition, announced on November 16, 2020, of the mining properties of the Kamistiatusset iron ore project (the "Kami Project") located in the Labrador Trough geological belt in southwestern Newfoundland, near the Québec border, and certain related contracts (the "Acquisition") pursuant to an asset purchase agreement among certain affiliates of the Company and Deloitte Restructuring Inc. (the "Receiver"), as receiver for Alderon Iron Ore Corp. ("Alderon") and certain of its affiliates for a consideration consisting of $15 million in cash, the extinguishment of approximately $19.4 million in secured debt of Alderon and certain of its affiliates (the "Secured Debt") and an undertaking in favour of the Receiver to make a finite production payment on a fixed amount of future iron ore concentrate production from the Kami Project (the "Acquisition").

In connection with the Acquisition, Champion purchased the Secured Debt from Sprott Private Resource Lending (Collector), LP ("Sprott") for an aggregate consideration of 4.2 million ordinary shares of Champion (the "Consideration Shares") issued to Sprott and Altius Resources Inc., who held a participation in the Secured Debt.

The Kami Project is a high-grade iron ore project near available infrastructure, situated only a few kilometres south east of the Company's operating Bloom Lake mine ("Bloom Lake"). The Kami Project's prior owner completed an updated feasibility study in September 2018. The Company expects to revise the project's scope and update its feasibility study in the near term as it diligently considers growth alternatives within its portfolio. As part of the Acquisition, Champion secured an additional eight million tonnes per annum of port capacity, including a pre-payment of port related fees, at the multiuser berth of the port of Sept-Îles, currently being used by the Company to export iron ore concentrate from Bloom Lake.

Champion's CEO, Mr. David Cataford, said "This acquisition adds a large scale and highly prospective project to our portfolio. In addition, by securing additional port capacity, this further de-risks our Bloom Lake Phase II expansion project, which is currently under construction. In keeping with our track record of diligently evaluating and transforming opportunities into valuable assets, we look forward to revising the Kami Project's scope and updating its previously completed feasibility study, along with its potential to positively impact local communities and the regional economy, which is and has always been a key goal for our Company."