Midas Gold Announces Private Placement Re-Pricing

Midas Gold Announces Private Placement Re-Pricing

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR RELEASE, PUBLICATION, DISTRIBUTION OR DISSEMINATION DIRECTLY, OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES.VANCOUVER, British Columbia, March 10, 2020 (GLOBE NEWSWIRE) — Midas Gold Corp. (MAX:TSX / MDRPF:OTCQX, “Midas Gold” or the “Company”) today announced that it has amended its private placement originally announced on February 27, 2020 (the “Offering”, comprised of the Note Offering and Brokered Offering as defined below) in order to reflect the current market price of the Company’s common shares. 
“The turmoil in the market since the announcement of the offering on February 27, 2020 has impacted the price of Midas Gold’s shares, along with many others,” said Stephen Quin, President & CEO.  “After considering the market conditions, Midas Gold’s need for additional financing in the near term and the impact of the re-pricing on overall dilution, among other factors, Midas Gold determined that having funding certainty to carry on with its permitting process warranted an agreement to modify the terms of the financing and ensure a timely completion of the Offering.”Pursuant to the amended terms of the Offering:the conversion price of the Canadian dollar denominated 0.05% senior unsecured convertible notes (the “Notes”) to be issued by a wholly-owned subsidiary of the Company pursuant to the Offering will be reduced from C$0.53 to C$0.4655;the purchase price of the common shares of the Company (the “Common Shares”) under the Offering will be reduced from C$0.53 to C$0.4655;Paulson & Co. Inc., on behalf of the several investment funds and accounts managed by it (“Paulson”) has agreed to purchase Notes for gross proceeds of a minimum C$34,000,000 (the “Note Offering”), being the Canadian dollar equivalent of US$25 million(1);BMO Capital Markets and Sprott Capital Partners LP (as co-lead agents) and a syndicate of agents including Cormark Securities Inc. and Haywood Securities Inc. (collectively, the “Agents”) have agreed to act as agents in connection with a best efforts brokered private placement of Notes and/or Common Shares (the “Brokered Offering”) for total gross proceeds of up to C$13,600,000, being the Canadian dollar equivalent of US$10 million(1).upon completion of the Offering, the Company and the Issuer would receive aggregate gross proceeds of C$47,600,000;all other material terms of the previously announced Offering remain unchanged, including the following:the amount of gross proceeds to be raised under the Offering remains at US$35 million;to the extent that any portion of the Brokered Offering is not purchased by other investors, Paulson will subscribe for the remainder of the Brokered Offering amount in the form of additional Notes, thereby ensuring the Offering would be fully subscribed;the intended use of proceeds from the Offering is the same as previously announced;the Company has applied to the TSX under Section 604(e) of the Manual and will be relying on the “financial hardship” exemption from the requirement to obtain shareholder approval in respect of the Offering; andsince neither the fair market value of the securities acquired by the Paulson (an insider of the Company), nor the consideration for the securities paid by Paulson, exceeds 25% of the Company’s market capitalization as calculated in accordance with MI 61-101 (as defined below), the issuance of securities is exempt from the formal valuation requirements of Section 5.4 of Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions (“MI 61-101”) pursuant to Subsection 5.5(a) of MI 61-101 and exempt from the minority approval requirements of Section 5.6 of MI 61-101 pursuant to Subsection 5.7(1)(a) of MI 61-101.Total Securities IssuableAs a result of the foregoing, an aggregate of 102,255,639 Common Shares (or 37.66% of the Company’s currently issued and outstanding Common Shares) will be issued or made issuable pursuant to the Offering, whether through the issuance of Common Shares, or the conversion of Notes, sold under the Offering. A minimum of 73,039,742 Common Shares will be made issuable to insiders (being the number of Common Shares issuable upon the conversion of all Notes to be purchased by Paulson under the Note Offering).  To the extent that any portion of the Brokered Offering is not purchased by other investors, up to a maximum of 102,255,639 Common Shares could be made issuable to insiders (being the maximum number of Common Shares issuable upon the conversion of all Notes purchased by Paulson in the event that there are no other subscribers under the Brokered Offering).The Conversion Price of C$0.4655 represents a 5% discount to the closing price of the Common Shares (a 12.07% discount to the 5-day volume-weighted trading price of the Common Shares) on the Toronto Stock Exchange (“TSX”) on March 9, 2020.Participation in the Offering by PaulsonPaulson’s current security holdings of the Company consists of 9,664,520 Common Shares and outstanding convertible notes of the Issuer in the principal amount of C$34,502,500.13, representing 3.56% of the outstanding Common Shares of the Company (107,101,685 Common Shares or 29.03% on a partially diluted basis assuming conversion of just the convertible notes currently held by Paulson).  Upon completion of the Offering, Paulson will beneficially own 9,664,520 Common Shares, representing approximately 3.21% of the Company’s outstanding common shares (180,141,427 Common Shares or 38.23% on a partially diluted basis, assuming conversion of all convertible securities held by Paulson and no other convertible securities, and 35.00% assuming conversion of all existing convertible notes of the Company; and also assuming all of the Brokered Offering is sold to existing shareholders and other investors as to Common Shares only and no Notes). If no portion of the Brokered Offering is purchased by other investors, Paulson would beneficially own up to approximately 3.56% of the Company’s outstanding common shares (209,357,324 Common Shares or 44.43% on a partially diluted basis, assuming conversion of all convertible securities held by Paulson and no other convertible securities and 40.67% assuming conversion of all existing convertible notes of the Company).As Paulson already holds more than 20% of the Company’s outstanding securities on a partially diluted basis, the Offering would not materially affect control of the Company.Listing ReviewAs an automatic consequence of relying upon the financial hardship exemption under Section 604(e) of the TSX Company Manual, the TSX has commenced a remedial de-listing review, which is normal practice when a listed Company seeks to rely on this exemption. Although the Company believes that it will be in compliance with all of the TSX listing requirements following completion of the Offering, no assurance can be provided as to the outcome of such review and, therefore, the Company’s continued qualification for listing on the TSX.For further information about Midas Gold Corp., please contact:
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