MONTREAL, Feb. 01, 2018 (GLOBE NEWSWIRE) -- ALGOLD RESOURCES LTD. (TSX-V:ALG) ("Algold" or the "Corporation") is pleased to announce that it has entered into a non-binding agreement with Osisko Gold Royalties Ltd ("Osisko") to complete a CDN $2 million private placement (the "Offering") and grant a 1.5% NSR royalty on the Tijirit Gold Project (the "Royalty") for a consideration of CDN $2.8 million, for total gross proceeds of CDN $4.8 million.

The Tijirit gold project is comprised of the Tijirit mining license 2480C2, covering 306 km 2, and of the adjacent Exploration License 1117B2, covering 460 km 2. The Tijirit Gold Project is the host of 3 adjacent deposits: Sophie, Lily and Eleonore, with an Inferred Resources of 602,000 oz Au at a grade of 2.29 g/t Au, including the high grade Eleonore deposit which hosts 357,920 ounces at a grade of 4.18 g/t Au (see Algold's press release dated May 1, 2017). Tijirit is situated approximately 30 kilometers southeast from the Tasiast gold deposit.

Algold Chairman Benoit La Salle said: "Osisko provides Algold with a break-through investment for the development of Algold's Mauritanian Tijirit Gold Project. We are privileged to have Osisko as a strategic partner."

François Auclair, President and CEO of Algold said: "We are extremely pleased to receive financing and endorsement from a world leading precious metals royalty company. Osisko is a much-valued strategic shareholder that validates the potential of our flagship Tijirit Gold Project and ensures that Algold takes advantage of current and future opportunities to create shareholder value in Africa."

Sean Roosen, Chairman and CEO of Osisko said: "We are delighted to participate in the advancement of the Tijirit Gold Project, located in a top emerging gold camp."

Upon closing of the Offering, Osisko will own approximately 12.6% of Algold's outstanding common shares on a partially-diluted basis.

Under the Offering, Osisko will subscribe for 14,285,714 units, each at a price of $0.14 and consisting of one common share and one common share purchase warrant entitling the holder to acquire one common share at a price of $0.20 for a period of 36 months.

Upon closing of the Offering, Osisko will be granted the following rights:
  1. It may nominate up to two candidates for Algold's board of directors at any meeting of the Corporation's shareholders (including one director to be appointed immediately upon closing).
  2. Until December 31, 2025, it will hold an exclusive option to purchase a 2.0% NSR royalty on any new project acquired by Algold.
  3. A right of first refusal on any royalties, streams or similar interests in the products mined on Algold's properties that are granted or proposed for granting in the future.

The closing of the Offering and the Royalty financing is expected to occur on or about February 5, 2018 and is subject to completion of formal documentation and receipt of regulatory approval, including the approval of the TSX Venture Exchange (the "TSXV"). All securities issued in connection with the Offering will be subject to a four month hold period. The net proceeds from the Offering will be used to carry out exploration drilling at the Corporation's mineral properties and for working capital and general corporate purposes.

In connection with the Private Placement, Wafa Mining & Petroleum SA ("Wafa") will also subscribe for 2,605,295 common shares, also at a price of $0.14 each, for total gross proceeds of $364,741, under a previously-granted pre-emptive right allowing Wafa to maintain a 10% interest in Algold (see Algold's press release dated August 9, 2017).

François Auclair, President and CEO of Algold said: "Wafa's desire to maintain their stake in Algold demonstrates their confidence in our projects. We are pleased to have their continued support."

The securities offered have not been, and will not be, registered under the U.S. Securities Act or any U.S. state securities laws, and may not be offered or sold in the United States or to, or for the account or benefit of, United States persons absent registration or any applicable exemption from the registration requirements of the U.S. Securities Act and applicable U.S. state securities laws. This press release does not constitute an offer to sell or the solicitation of an offer to buy securities in the United States, nor in any other jurisdiction.

This press release has been reviewed for accuracy and compliance under National Instrument 43-101 by André Ciesielski, DSc., PGeo., Algold Resources Ltd. Lead Consulting Geologist and Qualified Person, and Alastair Gallaugher, C.Geo. (Chartered Geologist and Fellow of the Geological Society of London), BSc. Geology, Algold's Exploration Manager in Mauritania, Qualified Persons as defined by NI 43-101 Standards of Disclosure for Mineral Projects. André Ciesielski has further approved the scientific and technical disclosure in the news release.

ABOUT ALGOLD

Algold Resources Ltd. is focused on the exploration and development of gold deposits in West Africa. The board of directors and management team are seasoned resource industry professionals with extensive experience in the exploration and development of world-class gold projects in Africa.

FORWARD-LOOKING INFORMATION

Certain statements in this press release may be forward-looking. Such statements include those with respect to Corporation's ability to complete the Offering and the grant of the Royalty. Although the Corporation believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurances that its expectations will be achieved. Such assumptions, which may prove incorrect, include the following: (i) Algold will be successful in its efforts to pursue the exploration activities referred to in this news release, (ii) Osisko and Algold will successfully negotiate the terms of final documentation in connection with both the Offering and the Royalty, (iii) Algold will obtain all required regulatory approvals for the Offering and the Royalty, (iv) Algold's management will not identify and pursue other business objectives using the proceeds of the Offering and (v) the price of gold will remain sufficiently high and the costs of advancing the Corporation's gold projects sufficiently low so as to permit Algold to implement its business plans in a profitable manner. Factors that could cause actual results to differ materially from expectations include (i) the parties' inability or unwillingness to complete the transactions described in this press release, in whole or in part, (ii) the Corporation's failure to make effective use of the proceeds of the Offering, (iii) the failure of the Corporation's projects, for technical, logistical, labour-relations or other reasons, (iv) the Corporation's inability to obtain the necessary regulatory approvals for the Offering or the Royalty, (v) a decrease in the price of gold below what is necessary to sustain the Corporation's operations, (vi) an increase in the Corporation's operating costs above what is necessary to sustain its operations, (vii) accidents, labour disputes or the materialization of similar risks, (viii) a deterioration in capital market conditions that prevents the Corporation from raising the funds it requires on a timely basis and (ix) generally, the Corporation's inability to develop and implement a successful business plan for any reason.

A description of other risks affecting Algold's business and activities appears in Algold's 2016 annual management's discussion and analysis, which is available on SEDAR at www.sedar.com. No assurance can be given that any events anticipated by the forward-looking information in this press release will transpire or occur, or if any of them do so, what benefits that Algold will derive therefrom. In particular, no assurance can be given as to the future financial performance of Algold. Algold disclaims any intention or obligation to update or revise any forward-looking statements in order to account for any new information or any other event, except as required under applicable law. The reader is warned against undue reliance on these forward-looking statements.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

For further information, please contact:

Algold Resources Ltd. 1320, boul. Graham, bureau 132, Mont-Royal, Québec, H3P 3C8, www.algold.com

François Auclair M.Sc., PGeoPresident & Chief Executive Officer f.auclair@algold.com+1 (514) 889 5089

Alex BallExecutive VP, Finance and Corporate Development a.ball@algold.com+1 (647) 919 2227

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