Midas Gold to Enter Strategic Relationship With Paulson & Co. and Raise C$55.2 Million

VANCOUVER, BC--(Marketwired - February 22, 2016) - Midas Gold Corp. (TSX: MAX) (OTCQX: MDRPF) ("Midas Gold" or the "Company") today announced that it has entered into a letter of intent with Paulson & Co. Inc., on behalf of the several investment funds and accounts managed by it ("Paulson"), pursuant to which Midas Gold will conduct an offering of Canadian dollar denominated 0.05% senior unsecured convertible notes (the "Notes") to be issued by a wholly owned subsidiary (the "Issuer") to Paulson on a private placement basis (the "Note Offering"). Concurrently, Midas Gold will complete an offering of Notes to certain of the Company's existing shareholders (the "Existing Shareholder Offering" and, together with the Note Offering, the "Offering") for total gross proceeds of C$55.2 million. The Notes will have a term of seven years and may be converted into common shares of Midas Gold at a price of C$0.3541 per share. The maximum gross proceeds of the Existing Shareholder Offering will be C$20.7 million, with the Note Offering to comprise the balance of the C$55.2 million to be raised.

Shareholder Support

All of the directors and officers of the Company have agreed to support the Offering at a meeting of shareholders to be convened to approve the Offering (the "Meeting"). Midas Gold intends to collect written support agreements from existing shareholders prior to the Meeting.

Use of Proceeds

Midas Gold intends to use the proceeds from the Offering to advance its Stibnite Gold Project (the "Project") in Idaho. In tandem with ongoing corporate cost cutting initiatives undertaken by the Company over the past three years, which are continuing, it is expected that the gross proceeds of the Offering along with Midas Gold's current working capital will be sufficient to fund ongoing stakeholder engagement, the environmental assessment and permitting process on the Project, and completion of a feasibility study for the Project.

Note Terms

The Notes will mature seven years after issuance and are convertible by the holders thereof (the "Noteholders") at any time prior to the maturity of the Notes, into common shares of the Company ("Common Shares") at a conversion price of C$0.3541 per share, being the trailing 10-day volume weighted average closing price of the Company's Common Shares on the TSX ("VWAP") immediately prior to announcement. The Notes will be redeemable, at the option of the Issuer, at any time after the fourth anniversary of the initial issue date of the Notes, provided that the 20-day VWAP is not less than 200% of the Conversion Price (or C$0.7082 per share) at the time of redemption and subject to the conversion rights of the Noteholders.