$4,000,000 Strategic Invest ment: Labrador Iron Mine

SURFACE MINING

$4,000,000 Strategic Investment: Labrador Iron Mine

Labrador Iron Mines Holdings Limited (OTC Pink: LBRMF) (the "Company") announced a US$4,000,000 strategic investment by New York Stock Exchange-listed Scully Royalty Ltd. ("Scully").

AUS$3,000,000 equity component and a US$1,000,000 convertible credit facility make up the Strategic Investment. Scully has consented to subscribe for 13,043,478 of the Company's common shares at a price of US$0.23 per share, for a total gross purchase price of US$3,000,000, and transform into a strategic shareholder by holding 7.4% of the Company's shares at close.

Additionally, through a subsidiary, Scully will grant the Company a US$1,000,000 unsecured, convertible credit line with a five-year duration, a 6.8% interest rate, and a US$0.31 per share conversion option, among other customary terms and conditions. The operating subsidiary of the company, Labrador Iron Mines Limited ("LIM"), will also create Labrador Iron Mines Limited Partnership ("LIMLP"), which will hold and advance the Houston Project.

A division of Scully will serve as the LIMLP's limited partner while LIM will serve as the project's general partner and operator. Scully will get the first opportunity to suggest project debt financing for the Houston Project's construction.

Scully will receive a number of rights in connection with the Strategic Investment, including the right to propose one director for the Company's Board of Directors, participation rights in any future financing to allow Scully to keep its ownership interest, and various other reporting rights and covenants.

“We are delighted to welcome Scully as a strategic investor,” commented John F. Kearney, President and CEO of Labrador Iron Mines. “Scully’s strategic investment and partnership represents a significant milestone for LIM and a strong endorsement by the company. Leveraging Scully’s extensive experience and relationships in iron ore mining in the Labrador Trough will be invaluable. for our advancement in Houston.”

Samuel Morrow, CEO of Scullydeclared, “We are delighted to partner with the team at Labrador Iron Mines and believe this investment will enable significant progress towards bringing the Houston Project into production.

Proceeds from the strategic investment will be used as working capital to advance the Houston project through a number of initiatives, which are expected to culminate in a Preliminary Feasibility Study (PFS) next year.