Alamos Gold Announces Closing of Acquisition of Argonaut Gold

All amounts are in US dollars unless otherwise indicated

TORONTO, July 12, 2024 (GLOBE NEWSWIRE) — Alamos Gold Inc. (TSX:AGI; NYSE:AGI) (“Alamos” or the “Company”) is pleased to announce the completion of the previously announced acquisition (the “Transaction”) of all of the issued and outstanding common shares of Argonaut Gold Inc. (TSX:AR) (“Argonaut”) not already owned by Alamos. A final order was entered by the Ontario Superior Court on July 5, 2024 approving the Plan of Arrangement pursuant to which the Transaction was given effect. Approval from the Mexican Federal Economic Competition Commission (“COFECE”) was also obtained on July 11, 2024.

As part of the Transaction, Alamos acquired the Magino Argonaut mine, located adjacent to the Alamos Island Gold mine in Ontario, Canada. Argonaut’s assets in the United States and Mexico were spun off into a newly formed junior gold producer called Florida Canyon Gold Inc. (“Florida Canyon Gold”). Under the terms of the Transaction, Argonaut shareholders will be entitled to receive 0.0185 shares of Alamos Class A common stock and 0.1 share of Florida Canyon Gold common stock in exchange for each issued and outstanding share of Argonaut common stock (the “Exchange Ratio”).

Alamos issued approximately 20.4 million Class A shares in the Transaction and will have approximately 419.7 million Class A shares outstanding following the closing of the Transaction. Alamos and Argonaut shareholders hold approximately 95% and 5% of the pro forma equity interests in the Company, respectively. Concurrently with the closing of the Transaction, Alamos completed a $10 million private placement in Florida Canyon Gold, increasing Alamos’ equity interest to approximately 19.99% (the “Private Placement”). Argonaut common shares are expected to be delisted from the Toronto Stock Exchange (“TSX”) on July 16, 2024. Florida Canyon Gold common shares are expected to begin trading on the TSX Venture Exchange (“TSX-V”) on July 16, 2024 under the symbol “FCGV.”

“With the acquisition of Argonaut, we have further strengthened our unique position as a Canadian intermediate gold producer with growing production and falling costs. The integration of Magino and Island Gold is expected to unlock significant synergies through the use of shared infrastructure. Together, they will create one of the largest and lowest-cost gold mines in Canada with significant long-term expansion potential, supported by a long mine life and continued exploration success,” said John A. McCluskey, President and Chief Executive Officer.

Early warning disclosure

Immediately prior to the Private Placement, following the giving of the Transaction, Alamos had beneficial ownership or control over 17,482,518 common shares of Florida Canyon Gold, representing approximately 13.67% of the issued and outstanding common shares of Florida Canyon Gold. Following the giving of the Private Placement, Alamos had beneficial ownership or control over 27,609,565 common shares of Florida Canyon Gold, representing approximately 19.99% of the issued and outstanding common shares of Florida Canyon Gold.

Alamos acquired additional shares of Florida Canyon Gold common stock in connection with the Transaction to enable Florida Canyon Gold to fund its immediate liquidity needs as a newly formed junior gold producer. The net proceeds from the Private Placement will be used by Florida Canyon Gold for working capital and general corporate purposes.

An early warning report relating to the Private Placement will be filed under applicable securities laws and will be available on Florida Canyon Gold’s SEDAR+ profile at www.sedarplus.ca. To obtain a copy of the early warning report after it has been filed, contact Alamos at Brookfield Place, 181 Bay Street, Suite 3910, Toronto, Ontario, M5J 2T3, Attention: Scott K. Parsons, 416-368-9932 x 5439.

Florida Canyon Gold’s head office address is 100 King Street West, Suite 3400, Toronto, Ontario, M5X 1A4.

Argonaut Convertible Bonds

As a result of the Transaction, holders of Argonaut’s outstanding 4.625% senior unsecured convertible notes (the “Notes”) will be entitled to receive Alamos common shares (in exchange for Argonaut common shares), based on the Exchange Ratio, upon conversion of the Notes, pursuant to the terms of the indenture governing the Notes (the “Indenture”). Alamos and Argonaut have entered into an additional indenture with Computershare Trust Company of Canada, as trustee, to, among other things, evidence Alamos’s agreement to issue Alamos common shares to each noteholder upon conversion of the Notes.

Within 30 days of the closing of the Transaction, Alamos will make an offer to purchase the Notes pursuant to the terms of the Loan Agreement.

The bonds remain listed on the TSX under the symbol “AR.DB.U”.

About Alamos

Alamos is a Canadian intermediate gold producer with diversified production from three operations in North America. These include the Young-Davidson mine and Island Gold District in northern Ontario, Canada, and the Mulatos District in Sonora, Mexico. In addition, the company has a strong portfolio of development projects, including the Phase 3+ expansion at Island Gold and the Lynn Lake project in Manitoba, Canada. Alamos employs over 2,400 people and is committed to the highest standards of sustainability. The company’s shares are traded on the TSX and NYSE under the symbol “AGI.”

FOR FURTHER INFORMATION PLEASE CONTACT:

Scott K. Parsons
Senior Vice President, Investor Relations
(416) 368-9932×5439

The TSX and NYSE have not reviewed this press release and are not responsible for its accuracy or reliability.

Warning note

This press release contains or incorporates by reference “forward-looking statements” and “forward-looking information” as defined under applicable Canadian and U.S. securities laws. All statements, other than statements of historical fact, that address events, results, outcomes or developments that Alamos expects to occur are or may be deemed to be forward-looking statements. Forward-looking statements are generally, but not always, identified by the use of forward-looking terminology such as “expect,” “assume,” “anticipate,” “believe,” “potential” or variations of such words and phrases and similar expressions or statements that certain actions, events or results “may,” “could,” “might” or “will” be taken, occur or be achieved or the negative connotations of such terms.

Forward-looking statements in this press release include, but are not limited to, information, expectations and guidance regarding strategy, plans, future financial and operating results, such as expectations and guidance regarding: the delisting of Argonaut common shares from the TSX and the commencement of trading of Florida Canyon Gold common shares on the TSX-V; costs and anticipated cost declines; assumptions regarding gold and other metals prices; anticipated gold production; continued production and growth potential; returns to stakeholders; the benefits and advantages of the Company’s acquisition of Argonaut to shareholders; and the synergies expected to be created by the integration of the Island Gold and Magino mines, such as the use of common infrastructure and the unlocking of significant life-cycle value of the mine; the value and size of the operation; expansion and exploration potential; and any other statements or information expressing management’s expectations or estimates regarding future results, operating, geological or financial performance.

Alamos cautions that forward-looking statements are necessarily based upon a number of factors and assumptions that, while considered reasonable by Alamos at the time such statements are made, are inherently subject to significant uncertainties and contingencies relating to business, economics, technology, law, politics and competition. Known and unknown factors could cause actual results to differ materially from those projected in forward-looking statements, and undue reliance should not be placed on such statements and information.

Such factors include (without limitation): changes in current estimates of mineral reserves and resources; the speculative nature of mineral exploration and development; risks associated with obtaining and maintaining necessary licenses, permits and authorizations during the development phase of the Company and its operating assets; the business may be subject to disease, epidemics and pandemics and the related impact on the broader market and market price of the Company’s shares; provincial and federal orders or mandates (including those relating to mining operations generally or to operations or ancillary services required for the operations) in Canada, Mexico, the United States and Turkey which may affect many aspects of the Company’s operations, including the ability to transport personnel to and from mining sites, the availability of contractors and supplies and the ability to sell or deliver Doré gold bars; fluctuations in the price of gold or certain other commodities such as diesel fuel, natural gas and electricity; changes in foreign exchange rates; the impact of inflation; employee-community relations; the impact of legal and administrative proceedings; delays or other issues related to the delisting and listing of Argonaut shares on the TSX and Florida Canyon Gold on the TSXV; changes in production estimates (which assume the accuracy of projected ore grades, production rates, production timing and production rate estimates, which may be affected by unplanned maintenance, weather conditions, labor and contractor availability and other operational or technical difficulties); disruptions affecting operations; risks associated with new mine start-ups; delays in the Phase 3+ expansion of Island Gold, construction decisions and any development of the Lynn Lake Gold Project and/or the development or update of mine plans; failure to realize exploration opportunities; inherent risks associated with the extraction and processing of minerals; the risk that the Company’s mines may not operate as planned; increases in mining and labor costs; title disputes; changes in national and local laws, controls or regulations in Canada, Mexico, Turkey, the United States and other jurisdictions in which the Company operates or may operate in the future; risks related to climate change; the risk of losses due to sabotage, protests and other civil unrest; the costs and timing of construction and development of new deposits; the impact of global liquidity and credit availability and the value of assets and liabilities based on projected future cash flows; risks arising from holding derivative instruments; and business opportunities that the Company may pursue.

Additional risk factors that could affect the Company’s ability to achieve the expectations set forth in the forward-looking statements contained in this press release are set forth in the Company’s most recent Form 40F/Annual Information Form and in Management’s Discussion and Analysis, each under the caption “Risk Factors” available on SEDAR+ at www.sedarplus.ca or on EDGAR at www.sec.gov, and should be considered in conjunction with the information, risk factors and assumptions contained in this press release. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.