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Paulson & Co. Reports Sent Letter To Midas Gold Corp. Requisitioning A Special Meeting Of Shareholders In Order To Refresh Co. Board

Marcelo Kim, Partner at Paulson, said, “If elected, the new Board will have more U.S.-based directors, specifically Idaho-based directors, and greater diversity of thought and experience, better equipping the Board

· 11/20/2020 06:05

Marcelo Kim, Partner at Paulson, said, “If elected, the new Board will have more U.S.-based directors, specifically Idaho-based directors, and greater diversity of thought and experience, better equipping the Board to help the Company achieve its long-term goals. And, in stark contrast to current directors, the new Board expects to hold substantial amounts of stock in the Company, creating economic alignment with Midas Gold’s shareholders.”

Paulson, the single largest shareholder of Midas Gold, has decided to take this matter to its fellow shareholders for the following reasons:

  • With Midas Gold set to receive its major Federal permit in the next year – now that the public comment period has concluded – Paulson believes it is necessary and appropriate to proactively refresh the Board with members better aligned with the evolution of the Company into a U.S.-based producer of critical minerals.



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  • Reconstituting the Board with more U.S. and Idaho-based directors will demonstrate the Company’s long-term commitment to Idaho, its people and the successful restoration and development of the Stibnite Gold Project.



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  • More U.S.-based representation is necessary to reflect the growing strategic value that the Stibnite Gold Project has to the U.S. Government as the potential first new domestic source of the critical mineral antimony, an essential mineral in national security and energy products, including renewables.



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  • Paulson has reaffirmed its long-term commitment to the Company by recently converting all of its debt into common shares, reducing any potential economic drag as Midas Gold moves forward.



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  • Paulson tried to engage collaboratively with the Board to arrange a respectful transition that acknowledged their many years of service, but its efforts to date were rebuffed.

Accordingly, Paulson is calling for the removal of Keith Allred, Jaimie Donovan, Brad Doores, Jon Goode, and Peter Nixon, to be replaced with five new independent, highly qualified directors.

Further, Paulson intends to expand the Board and to elevate Laurel Sayer, the current and longstanding CEO of Midas Gold Idaho, to the refreshed Board.

Paulson has called for a meeting to be held no later than January 18, 2021.

Proposed Slate of New Directors

  • Bob Dean, who was raised in Idaho and now resides in Boise, has over two decades of experience in business, investment management, corporate finance, and capital markets, having spent over 20 years at Allen & Company. He is currently the Managing Member of Gemstone Capital and Co-Owner of Ada Sand & Gravel, one of the largest independent producers of construction aggregates in Southwestern Idaho. Mr. Dean is a Board Member of Natural Intelligence Systems, Inc., an Advisory Committee Member at Greybull Stewardship, and serves as a Board Member of several non-profits including Trailhead Boise, MoFi, and Ramapo for Children.   
  • David Deisley, who resides in Salt Lake City, Utah, most recently led the successful permitting effort for the Donlin Gold Project in Alaska for NovaGold Resources and brings extensive recent permitting experience in the U.S. as well as a wealth of experience in corporate affairs, native/tribal stakeholder engagement, legal governance, litigation, and mergers and acquisitions. Prior to his tenure with NovaGold, Mr. Deisley was the Executive Vice President, Corporate Affairs and General Counsel for Goldcorp and previously worked at Barrick Gold.
  • Jeff Malmen, a native Idahoan who resides in Boise, is currently the Senior Vice President of Public Affairs for IDACORP and Idaho Power, where he has worked since 2007. In his role, he oversees government and regulatory affairs, corporate communications and corporate services, including supply chain, real estate and facilities. Prior to that, Jeff enjoyed a 21-year career in state and federal politics, most recently as Chief of Staff for Idaho Governor C.L. “Butch” Otter and Idaho Governor Phil Batt prior to that. He also served as Administrator of the Division of Financial Management for Idaho Governor Dirk Kempthorne. He is the Vice Chairman of the Idaho Association of Commerce and Industry and Board Member of the Idaho Mining Association.
  • Chris Robison, who resides in Denver, Colorado and was most recently Chief Operating Officer for Newmont Mining, the world’s largest gold miner, brings extensive expertise in mining, metallurgy, project development, mine safety, stakeholder engagement, environmental issues, corporate social responsibility, supply chain, mergers and acquisitions, capital investments, business improvement and regulatory issues. Prior to his role at Newmont, Mr. Robison had a distinguished career at Rio Tinto Minerals and Kennecott Utah Copper.
  • Alex Sternhell, based in Chevy Chase, Maryland, is one of the top Washington strategists and lobbyists helping to shape U.S. public policy as Principal of the Sternhell Group. Mr. Sternhell has more than two decades of experience working on Capitol Hill. He served as the Democratic Deputy Staff Director of and Senior Policy Advisor to the U.S. Senate Committee on Banking, Housing and Urban Affairs as well as the Staff Director for the Senate Banking Subcommittee on Securities and Investment. He played a key role in drafting and negotiating nearly every major piece of financial services legislation in recent history, including Sarbanes-Oxley, the Terrorism Risk Insurance Act, and Gramm-Leach Bliley.

Long-Term Commitment to Restoration and U.S. Critical Minerals

Paulson believes it is in Midas Gold’s long-term best interests to become a U.S.-listed, U.S.-domiciled, and U.S.-based company, committed to the restoration and development of the Stibnite Gold Project. The project will re-establish fish passageways, rehabilitate natural vegetation, and improve overall water quality at a brownfields site, and lead to a significant $1 billion investment that will create 1,000 direct and indirect jobs in Idaho. Additionally, once developed, the Stibnite Gold Project is set to become the only source of U.S.-mined antimony, which has been declared a critical mineral by the U.S. Government.   By making these changes to the Company’s Board at this time, Midas Gold will be better positioned to deliver on its promises to its stakeholders.   Redomiciling from Canada to the U.S. will streamline Midas Gold’s corporate structure by eliminating duplicate overheads, including the Vancouver office, thereby empowering employees in Idaho to continue advancing the Stibnite Gold Project.

Advisors

Paulson has retained Mackenzie Partners, Inc. and Carson Proxy as its strategic shareholder services advisors. Goodmans LLP is acting as legal counsel.

Ceasing to File under Part 4 of National Instrument 62-103

In connection with the requisition, Paulson also announced today that it has ceased filing reports in accordance with the alternative monthly reporting system under Part 4 of National Instrument 62-103 – The Early Warning System and Related Take-Over Bid and Insider Reporting Issues (“NI 62-103”) for Midas Gold.

Paulson is an investment advisor that furnishes investment advice to and manages onshore and offshore investment funds and separate managed accounts (such investment funds and accounts, the “Funds”). In its role as investment advisor or manager, Paulson possesses voting and/or investment power over the securities of the issuer described in this news release. All of the securities identified in this news release are owned by the Funds.

Paulson controls the common shares described herein on behalf of the Funds for investment purposes. In fulfilling its responsibilities to the Funds, Paulson may make its views known regarding the operation of the business and strategic direction or alternatives to Midas Gold’s management or board of directors from time to time, when proxies are solicited and on other occasions. Depending on market conditions and other factors that Paulson may deem material to its investment decisions, Paulson may, on behalf of the Funds, in the future acquire additional common shares, notes, debentures, options or other derivative securities related to the common shares of Midas Gold, in the open market or in privately negotiated purchases or otherwise. Paulson may also, on behalf of the Funds, depending on then-current circumstances, dispose of all or a portion of the common shares, notes, debentures, options or other derivative securities related to the common shares of Midas Gold, in one or more transactions, in each case to the extent then permitted by applicable law and regulation. Other than as described in this news release, Paulson does not have any plans or intentions with respect to any of the items enumerated in Item 5 of Form 62-103F2.

A report on Form 62-103F2 – Required Disclosure by an Eligible Institutional Investor under Section 4.3 is being filed by Paulson in accordance with NI 62-103 and will be available under Midas Gold’s SEDAR profile at www.sedar.com.