IAMGOLD announces $300 million financing on ceremonial launch of Côté

More than 200 guests from around the world attended IAMGOLD's ceremonial event in Gogama, Ontario today to acknowledge the Côté Gold Mine's official launch. The news comes on the heels of  IAMGOLD Corporation entering into an agreement with a syndicate of underwriters led by National Bank Financial Markets, BMO Capital Markets and RBC Capital Markets pursuant to which they have agreed to purchase, on a bought deal basis, 72,000,000 common shares of the Company at a price of US$4.17 per common share (the “Offering Price”), for aggregate gross proceeds to the Company of approximately US$300 million (the “Offering”). The underwriters will also have the option, exercisable in whole or in part, at any time up to 30 days following the closing of the Offering, to purchase up to an additional 10,800,000 common shares at the Offering Price to cover over-allotments, if any. In the event that the option is exercised in its entirety, the aggregate gross proceeds of the Offering to the Company will be approximately US$345 million.

Use of Proceeds

IAMGOLD intends to use the net proceeds of the Offering, including the net proceeds from the Over-Allotment Option should it be exercised, towards the repurchase of the 9.7% interest (“Transferred Interest”) in the Côté Gold Mine from Sumitomo Metal Mining Co. Ltd. (“Sumitomo”), in order to return to its full 70% interest in the Côté Gold Mine. The net proceeds of the Offering are to be deposited in an interest-bearing account or used to repay drawn amounts under its credit facility, in accordance with good cash management practices, until the completion of the aforementioned repurchase which is expected to be completed prior to the end of the calendar year.

Based on the current ramp-up schedule of the Côté Gold Mine as well as prevailing market conditions which could impact the amount of required expenditures during the ramp-up of Côté Gold and operating cash flows from the Company's existing operations, the Company believes that the net proceeds of the Offering, combined with cash and cash equivalents at March 31, 2024, expected cash flows from operations, the expected proceeds from the sale of the remaining Bambouk assets and the available liquidity provided by the undrawn amounts under the credit facility, will be sufficient to fund the repurchase of the Transferred Interest.

The repurchase will increase the Company’s exposure to the Côté Gold Mine and result in additional economic benefits and cashflows and remove associated costs of holding the option to repurchase the 9.7% interest.

More on the May 22 launch coming.

Background on Côté Joint Venture & Sumitomo Repurchase Agreement

The Côté Gold Mine is being operated through a joint venture (the "Côté Gold UJV" or "UJV") between IAMGOLD, as the operator, and Sumitomo. The UJV is governed by the Côté Gold Joint Venture Agreement.

IAMGOLD’s participation is 60.3% in the UJV and has an option to repurchase a 9.7% interest from Sumitomo as part of the JV Funding and Amending Agreement (the “JV Funding Agreement”) announced on December 19, 2022. Under the terms of the JV Funding Agreement the Company has the right to repurchase its 9.7% interest (“Transferred Interest”) in the Côté Gold Mine from Sumitomo on May 31st and November 30th of every year from November 30, 2023 up to and including November 30, 2026.

The JV Funding Agreement also provides that until the earlier of the Company repurchasing the Transferred Interest and November 30, 2026, the Company will pay a repurchase option fee to Sumitomo equal to the three-month Secured Overnight Financing Rate ("SOFR") plus 4% on the contributions made by Sumitomo due to the Transferred Interest.

The purchase price for this repurchase is equal to the initial funding of US$250 million contributed by Sumitomo for the Transferred Interest, plus the incremental contributions made, less incremental gold production received, by Sumitomo due to its increased ownership up to achieving commercial production, plus any accrued and unpaid amounts for the option fee payable thereon.

In its financial statements, the Company recognizes a financial liability for the Côté Gold Repurchase Option equal to the current repurchase price (including the accrued and unpaid amount for the option fee). As at March 31, 2024, this financial liability was US $366.8 million.

Transaction Details

The Offering will be made in all provinces and territories of Canada (other than Québec and Nunavut) by way of a final prospectus supplement to the Company’s existing base shelf prospectus dated September 1, 2022 (the “Base Shelf Prospectus”) to be filed on or about May 22, 2024 (the “Prospectus Supplement”) with the securities regulatory authorities in each of the provinces and territories in Canada. The Offering will be made in the United States pursuant to a preliminary prospectus supplement and a final prospectus supplement (together, the “U.S. Prospectus Supplements”), filed as part of an effective registration statement on Form F-10 (the “Registration Statement”), filed with the U.S. Securities and Exchange Commission (“SEC”) under the Canada/U.S. multi-jurisdictional disclosure system.

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