AGNICO EAGLE ANNOUNCES SUBSCRIPTION FOR COMMON SHARES OF FIRST NORDIC METALS CORP.

Rhea-AI Summary

Agnico Eagle Mines (NYSE: AEM, TSX: AEM) has announced a transaction with First Nordic Metals Corp. (TSX-V: FNM) to acquire 27,954,872 common shares of FNM. The deal involves exchanging amounts due under a previous asset purchase agreement for FNM shares at $0.2925 per share, totaling approximately $8,176,800. This non-brokered private placement is expected to close around July 22, 2024.

Upon completion, Agnico Eagle's ownership in FNM will increase from 0.75% to approximately 13.25% of outstanding shares. The transaction includes an investor rights agreement granting Agnico Eagle participation rights in future equity financings and potential board nomination rights. Agnico Eagle states that this acquisition is to settle remaining amounts due under the previous purchase agreement.

Positive

• Acquisition of 27,954,872 common shares of First Nordic Metals Corp.
• Increase in ownership from 0.75% to 13.25% of FNM's outstanding shares
• Investor rights agreement granting participation in future equity financings
• Potential board nomination rights for Agnico Eagle in FNM

Negative

• Expenditure of approximately $8,176,800 for the share acquisition

Insights

Financial Analyst

Agnico Eagle's strategic investment in First Nordic Metals (FNM) by acquiring a substantial number of shares has notable financial implications. This transaction not only increases Agnico Eagle's stake in FNM to 13.25% but also signifies a settlement of outstanding amounts under a previous asset purchase agreement. For retail investors, this move should be seen in the context of Agnico Eagle's broader strategy to consolidate its holdings and potential control over FNM.

The subscription price of $0.2925 per share translates to a total investment of $8,176,800. For Agnico Eagle, this is a relatively modest outlay considering its market capitalization. However, the significant aspect is the potential influence it will gain by holding a substantial share and the rights to participate in future financings and board nominations. These rights could provide Agnico Eagle with an advantageous position to steer FNM's strategic decisions, aligning them with its own interests.

This transaction suggests a long-term commitment by Agnico Eagle to FNM, potentially indicating confidence in the prospects of the assets managed by FNM, including the operations under Gold Line Resources Ltd. For investors, this can be viewed as a positive signal regarding the future valuation and stability of FNM's shares. However, it is important to remain cautious of the market conditions and Agnico Eagle's intentions to either increase or decrease its holdings in the future.

Market Research Analyst

From a market research perspective, Agnico Eagle's acquisition of additional shares in FNM highlights a strategic move to reinforce its presence in the Nordic metals sector. By converting outstanding payments into equity, Agnico Eagle demonstrates an astute financial strategy to strengthen its portfolio without expending additional cash resources.

One significant aspect for retail investors is the potential market impact on FNM's stock. Typically, such a sizeable acquisition by a major player can boost investor confidence and possibly lead to a positive revaluation of FNM's shares. Additionally, the rights agreement allowing Agnico Eagle to maintain or expand its ownership stake ensures its potential long-term involvement, which could bring stability and sustained interest in FNM's performance.

However, investors should be aware of the dependency on market conditions. The future actions of Agnico Eagle, whether it decides to increase or sell its stake, can introduce volatility. The investor rights agreement's flexibility means Agnico Eagle's future decisions can significantly influence FNM's market trajectory.

Stock Symbol:  AEM (NYSE and TSX)

TORONTO, July 15, 2024 /PRNewswire/ - Agnico Eagle Mines Limited (NYSE: AEM) (TSX: AEM) ("Agnico Eagle") announced today that it has entered into a transaction with First Nordic Metals Corp. (TSX-V: FNM) ("FNM") that will result in Agnico Eagle acquiring 27,954,872 common shares ("Common Shares") of FNM.

Agnico Eagle has agreed to exchange amounts that remain due under the asset purchase agreement between certain subsidiaries of Agnico Eagle, certain subsidiaries of FNM and EMX Royalty Corporation dated March 19, 2021, as amended May 1, 2023 (the "Purchase Agreement") for 27,954,872 Common Shares (the "Transaction"). The Transaction is being effected by way of a subscription agreement between FNM and Agnico Eagle, whereby Agnico Eagle has agreed to subscribe for 27,954,872 Common Shares at a price of $0.2925 per Common Share for total consideration of approximately $8,176,800 (the "Consideration") in a non-brokered private placement, which is expected to close on or about July 22, 2024.

On closing of the Transaction, the Consideration will be immediately directed by FNM to its wholly-owned subsidiary Gold Line Resources Ltd. ("Gold Line"), and Gold Line will further direct the Consideration to Agnico Eagle Finland Oy and Agnico Eagle Sweden AB, each a wholly-owned subsidiary of Agnico Eagle, in satisfaction of payments that remain owing by Gold Line under the Purchase Agreement.

Agnico Eagle currently owns 1,458,294 Common Shares, representing approximately 0.75% of the issued and outstanding Common Shares on a non-diluted basis. On closing of the Transaction, Agnico Eagle will own 29,413,166 Common Shares, representing approximately 13.25% of the issued and outstanding Common Shares on a non-diluted basis.

On closing of the Transaction, Agnico Eagle and FNM will enter into an investor rights agreement pursuant to which Agnico Eagle will be granted certain rights, provided that Agnico Eagle maintains certain ownership thresholds in FNM, including: (a) the right to participate in equity financings and top-up its holdings in relation to dilutive issuances in order to maintain its pro rata ownership interest in FNM at the time of such financing or acquire up to a 19.99% ownership interest in FNM; and (b) the right (which Agnico Eagle has no present intention of exercising) to nominate one person (and in the case of an increase in the size of the board of directors of FNM to eight or more directors, two persons) to the board of directors of FNM.

Agnico Eagle is acquiring the Common Shares to settle the amounts that remain due under the Purchase Agreement. Depending on market conditions and other factors, Agnico Eagle may, from time to time, acquire additional Common Shares or other securities of FNM or dispose of some or all of the Common Shares or other securities of FNM that it owns at such time.

An early warning report will be filed by Agnico Eagle in accordance with applicable securities laws. To obtain a copy of the early warning report, please contact:

Agnico Eagle Mines Limited
c/o Investor Relations
145 King Street East, Suite 400
Toronto, Ontario M5C 2Y7
Telephone: 416-947-1212
Email: investor.relations@agnicoeagle.com

Agnico Eagle's head office is located at 145 King Street East, Suite 400, Toronto, Ontario M5C 2Y7. FNM's head office is located at 1055 West Hastings Street, Suite 300, Vancouver, British Columbia V6E 2E9.

About Agnico Eagle

Agnico Eagle is a Canadian based and led senior gold mining company and the third largest gold producer in the world, producing precious metals from operations in Canada, Australia, Finland and Mexico. It has a pipeline of high-quality exploration and development projects in these countries as well as in the United States. Agnico Eagle is a partner of choice within the mining industry, recognized globally for its leading environmental, social and governance practices. Agnico Eagle was founded in 1957 and has consistently created value for its shareholders, declaring a cash dividend every year since 1983.

Forward-Looking Statements

The information in this news release has been prepared as at July 15, 2024. Certain statements in this news release, referred to herein as "forward-looking statements", constitute "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and "forward-looking information" under the provisions of Canadian provincial securities laws. These statements can be identified by the use of words such as "may", "will" or similar terms.

Forward-looking statements in this news release include, without limitation, statements relating to the expected closing date of the Transaction, Agnico Eagle's ownership interest in FNM upon closing of the Transaction, Agnico Eagle's acquisition or disposition of securities of FNM in the future and the terms of the investor rights agreement.

Forward-looking statements are necessarily based upon a number of factors and assumptions that, while considered reasonable by Agnico Eagle as of the date of such statements, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Many factors, known and unknown, could cause actual results to be materially different from those expressed or implied by such forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date made. Other than as required by law, Agnico Eagle does not intend, and does not assume any obligation, to update these forward-looking statements.

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SOURCE Agnico Eagle Mines Limited

FAQ

What is the purpose of Agnico Eagle's transaction with First Nordic Metals Corp. (FNM)?

Agnico Eagle (AEM) is acquiring 27,954,872 common shares of FNM to settle amounts due under a previous asset purchase agreement between the companies.

How much is Agnico Eagle (AEM) paying for the FNM shares in the transaction?

Agnico Eagle is paying approximately $8,176,800 for the FNM shares, at a price of $0.2925 per common share.

What will be Agnico Eagle's (AEM) ownership percentage in FNM after the transaction?

After the transaction, Agnico Eagle's ownership in FNM will increase to approximately 13.25% of the issued and outstanding common shares on a non-diluted basis.

When is the Agnico Eagle (AEM) and FNM transaction expected to close?

The transaction between Agnico Eagle and FNM is expected to close on or about July 22, 2024.