NovaGold to gain full control of Donlin Gold

NOVAGOLD Resources Inc. has signed definitive agreements to acquire Paulson Advisers LLC’s 40% ownership interest in Donlin Gold LLC in an all-share transaction dated July 21, 2026. Completion of the deal would raise NOVAGOLD’s stake in Donlin Gold from 60% to 100%, consolidating full ownership of the asset within a single corporate structure. The transaction values the combined company at an implied equity value of approximately US$4.2 billion, based on NOVAGOLD’s July 21, 2026 closing share price of $5.63.

Under the agreements, the number of shares issued to Paulson for its Donlin Gold interest will be determined using a 10% discount to the equity value implied by NOVAGOLD’s 10-day volume-weighted average price as of July 21, 2026. This pricing formula directly links Paulson’s consideration to NOVAGOLD’s recent trading performance while embedding a negotiated discount.

The transaction contemplates the formation of a new Delaware corporation, NovaGold Corporation (New NG), which is intended to be listed on the New York Stock Exchange. New NG would acquire all issued and outstanding NOVAGOLD common shares through a share exchange arrangement. NOVAGOLD shareholders would receive 1.0 New NG share of voting common stock for each NOVAGOLD common share held, providing a straightforward 1-for-1 conversion into the new listed vehicle.

Following completion, current NOVAGOLD shareholders, inclusive of Paulson’s existing equity stake in NOVAGOLD, are expected to own approximately 65% of New NG. Paulson would indirectly receive about 35% of New NG on a fully diluted basis in exchange for its 40% interest in Donlin Gold. Taking into account both its contributed Donlin interest and its current NOVAGOLD shares, Paulson is expected to hold roughly 40% of the economic interest in New NG.

Despite its sizeable economic stake, Paulson’s voting power in New NG will be capped at 19.99%. This cap is part of a broader governance framework that also includes an investor rights agreement between Paulson and New NG. The agreement contains standstill provisions and voting restrictions designed to regulate Paulson’s influence over the new company’s affairs.

New NG shares issued to Paulson will be subject to a lock-up period. The lock-up will expire on the earliest of three events: completion of project financing for Donlin Gold, Paulson’s ownership falling below 10% of New NG equity, or the third anniversary of the transaction’s Effective Date. This structure is intended to support share price stability by limiting near-term share sales by a major holder.

The transaction remains subject to a range of approvals, including NOVAGOLD shareholder approval, court approval, regulatory clearances, stock exchange approvals and other customary closing conditions. The parties expect closing to occur in the fourth quarter of 2026, which would mark the Effective Date for the new structure and related agreements.

Directors and certain senior officers of NOVAGOLD, together with Electrum Strategic Resources L.P. and Paulson, have entered into voting support agreements. In aggregate, these parties represent approximately 28% of NOVAGOLD’s outstanding common shares and have committed to vote in favor of the transactions. The proposed New NG board leadership would feature Dr. Thomas S. Kaplan and John Paulson as co-chairmen, reflecting the alignment of key shareholder interests in the combined entity.