ALGOLD RESOURCES LTD. announced the signature of a strategic partnership agreement with its Mauritanian-based business partner, Wafa Mining & Petroleum SA (“Wafa”). The agreement underscores Wafa’s continued confidence in the Corporation by providing a locally recognized partnership for Algold to pursue its exploration and development efforts in Mauritania.

“Wafa is a well-known and skilled Mauritanian-based industrial firm and has been a valued Algold partner since 2013,” commented Algold Chairman, Benoit La Salle. “Through this new strategic agreement, Wafa not only further validates its long-term support, but provides Algold with the opportunity to significantly accelerate the development of the Corporation’s Mauritanian exploration projects. We are privileged to have Wafa as a strategic partner and look forward to our ongoing collaboration, as Algold continues its quest to unlock the true potential of its Tijirit gold project including the high-grade Eleonore structures.”

Wafa has agreed to complete a private placement (the “Offering”) of units of Algold, under which it will subscribe for a number of Algold’s common shares (each a “Common Share”) equal to 10% of the outstanding total, at a price of $0.20 per unit. Based on the current total of 167,250,275 outstanding Common Shares, Wafa would subscribe for 18,583,364 units, for total gross proceeds of $3,716,673. Each unit will be composed of one Common Share and 0.5538 of one Common Share purchase warrant, for a total of 10,291,682 such warrants. Each whole warrant (a “Warrant”) will entitle Wafa to acquire one Common Share at a price of $0.30, for a period of 18 months from the closing of the Offering. Upon closing of the offering, Wafa will have the right to nominate one member to Algold’s board of directors and would be granted the right to participate in any future offerings to allow Wafa to maintain its ownership stake.

“We are extremely pleased to further strengthen our collaboration with Wafa, which has a significant mining presence in Mauritania and is active across many sectors through its various subsidiary businesses,” said Algold CEO, François Auclair. “Wafa is a much-valued strategic shareholder that will ensure, in collaboration with Algold, that the Corporation takes full advantage of advancement opportunities to ultimately create shareholder value.”

The Offering, which remains subject to receipt of the approval of the TSX Venture Exchange, is expected to close no later than July 28, 2020.

The net proceeds from the Offering will be used to carry out exploration drilling on Algold Mauritanian properties and for working capital and general corporate purposes.

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.

In addition, Algold has agreed that, no later than July 31, 2020, it will make the cash payment of US$200,000 due to Wafa under their agreement previously announced on January 29, 2020. Wafa had previously deferred that payment, as previously announced on November 25, 2020. Wafa’s non-participating ownership stake in Société Mauritanienne d’Exploration (or a successor entity), which holds the existing Kneivissat permit, will also be increased from 10% to 12%.