Marathon Gold Corporation (TSX: MOZ) is pleased to announce the sale of an additional 1.5% net smelter returns royalty on its Valentine Gold Project to Franco-Nevada Corporation for US$45 million, resulting in Franco-Nevada holding an aggregate 3.0% NSR on the Project. In addition, Franco-Nevada has offered to purchase common shares of the Corporation comprising the entire back-end of a C$6.9 million non-brokered charity flow-through offering for which Marathon has firm commitments at a price of C$1.0488 per flow-through share. Marathon intends to use the proceeds of the Offering for eligible exploration expenditures at the Project.

Matt Manson, President and CEO, commented: “We are very happy to be announcing this amendment to our royalty arrangements with Franco-Nevada, which sees their NSR royalty on the Valentine Gold Project increase to 3% for consideration of US$45 million. With this transaction, we have strengthened our balance sheet for the Valentine build in a substantial fashion, while maintaining a disciplined overall approach to our capital structure. Franco-Nevada has been a royalty holder since 2019, and we welcome their continuing strong support for the Project. The associated offering of flow-through shares, by which Franco-Nevada also increases its share ownership in the Corporation, will be used to fund our discovery-oriented exploration programs in 2023 and 2024, including exploration at the encouraging and underexplored Eastern Arm Prospect.”

Paul Brink, President and CEO of Franco-Nevada, commented: “Having initially invested when Marathon was an exploration play, it is very rewarding to see Matt and team advancing the asset through construction. We look forward to celebrating first production with them.”

The gross proceeds received by the Corporation from the sale of the flow-through shares will be used to incur eligible expenses related to the Project which will constitute “Canadian exploration expenses” as defined in subsection 66.1(6) of the Income Tax Act (Canada) and which will also qualify as “flow-through mining expenditures” within the meaning of section 127(9) of the Income Tax Act (Canada). The CEE will be renounced to the subscribers of the flow-through shares with an effective date of no later than December 31, 2023 in an amount equal to the aggregate purchase price for the flow-through shares.

The Offering is being made by way of private placement in Canada. The flow-through shares will be subject to a four month hold period under applicable securities laws in Canada. Closing of the Offering is anticipated to occur on or about July 6, 2023 and is subject to receipt of regulatory approvals, including the approval of the Offering by the Toronto Stock Exchange.

RBC Capital Markets is acting as financial advisor to Marathon in connection with the royalty transaction.

About Marathon

Marathon is a Toronto based gold company advancing its 100%-owned Valentine Gold Project located in the central region of Newfoundland and Labrador, one of the top mining jurisdictions in the world. The Project comprises a series of five mineralized deposits along a 32-kilometre system. A December 2022 Updated Feasibility Study outlined an open pit mining and conventional milling operation producing 195,000 ounces of gold a year for 12 years within a 14.3-year mine life. The Project was released from federal and provincial environmental assessment in 2022 and construction commenced in October 2022. The Project has estimated Proven Mineral Reserves of 1.43 Moz (23.36 Mt at 1.89 g/t) and Probable Mineral Reserves of 1.27 Moz (28.22 Mt at 1.40 g/t). Total Measured Mineral Resources (inclusive of the Mineral Reserves) comprise 2.06 Moz (29.23 Mt at 2.19 g/t) with Indicated Mineral Resources (inclusive of the Mineral Reserves) of 1.90 Moz (35.40 Mt at 1.67 g/t). Additional Inferred Mineral Resources are 1.10 Moz (20.75 Mt at 1.65 g/t Au). Please see the NI 43-101 Technical Report “Valentine Gold Project, NI 43-101 Technical Report and Feasibility Study” effective November 30, 2022, Marathon’s Annual Information Form for the year ended December 31, 2022 and other filings made with Canadian securities regulatory authorities available at www.sedar.com for further details and assumptions relating to the Valentine Gold Project.