/NOT FOR DISSEMINATION, DISTRIBUTION, RELEASE, OR PUBLICATION, DIRECTLY
OR INDIRECTLY, IN OR INTO THE UNITED STATES OR FOR DISTRIBUTION TO U.S.
VANCOUVER, June 1, 2015 /CNW/ - Newmarket Gold Inc. ("Newmarket")(TSX-V:NGN) is pleased to announce that, further to its joint press release with Crocodile Gold Corp. ("Crocodile Gold") on May 11, 2015, announcing the plan to combine Crocodile Gold and
Newmarket (the "Transaction"), it has entered into an underwriting agreement (the "Underwriting Agreement") with GMP Securities L.P. and BMO Capital Markets as co-lead
underwriters and joint bookrunners, together with a syndicate of
underwriters including Haywood Securities Inc. and RBC Capital Markets
(collectively, the "Underwriters"). Pursuant to the Underwriting Agreement, the Underwriters have agreed
to purchase from Newmarket on an underwritten, private placement basis
19,840,000 subscription receipts (the "Subscription Receipts") of Newmarket for aggregate gross proceeds of C$24,800,000 (the "Private Placement") at a price of $1.25 per Subscription Receipt (the "Issue Price"), taking into account the notional 5 for 1 share consolidation
pursuant to the Transaction. In addition, a director of Newmarket has
agreed to separately purchase from Newmarket on a non-brokered private
placement basis, C$200,000 of subscription receipts at the Issue Price
(the "Concurrent Placement"). The total gross proceeds of the Private Placement and Concurrent
Placement is C$25,000,000. Management and directors of Newmarket
intend to subscribe for up to an aggregate of approximately C$8.9
million in the Private Placement and Concurrent Placement.
Each Subscription Receipt to be sold by Newmarket will ultimately
entitle the holder thereof to receive one common share of the combined
company ("NewCo") upon completion of the Transaction.
Closing of the Private Placement and Concurrent Placement is expected to
occur on or around June 12, 2015.
Assuming the satisfaction of the Release Conditions (as defined below),
up to C$20,000,000 of the proceeds of the Private Placement and
Concurrent Placement will be used to fund the cash consideration
payable to Crocodile Gold shareholders who elect to receive cash in
connection with the Transaction and the remainder will be used to
bolster the working capital position of NewCo upon completion of the
Transaction. The Subscription Receipts will be subject to a four-month
and a day hold period, however, upon closing of the Transaction the
Subscription Receipts will be exchanged for freely-tradable NewCo
The gross proceeds from the Private Placement and Concurrent Placement
will be deposited and held in escrow and shall be released immediately
prior to the completion of the Transaction upon the satisfaction of
certain conditions (the "Release Conditions") on or before August 31, 2015. If the Release Conditions are not
satisfied on or before August 31, 2015, or prior to such date,
Newmarket advises the Underwriters or announces to the public that it
does not intend to satisfy the Release Conditions, the escrow agent
will return to holders of the Subscription Receipts, an amount equal to
the aggregate subscription price for the Subscription Receipts held by
them, together with a pro rata portion of interest earned on the
escrowed proceeds and the Subscription Receipts will be cancelled and
of no further force or effect.
ON BEHALF OF THE BOARD
Douglas Forster, M.Sc., P.Geo.
President & Chief Executive Officer
About Newmarket Gold Inc.
Newmarket is a Canadian gold company focused on creating shareholder
value through the acquisition of quality gold production opportunities
and outstanding development stage assets in mining friendly,
politically stable jurisdictions world-wide. The Company was founded by
an experienced group of dealmakers, mine developers, financiers and
capital markets professionals and is focused on a disciplined approach
to asset acquisition and growth.
Cautionary Note Regarding Forward Looking Information
Certain information set forth in this news release contains
"forward-looking statements", and "forward-looking information under
applicable securities laws. Except for statements of historical fact,
certain information contained herein constitutes forward-looking
statements, which include the Company's expectations about the
completion of the Transaction, Private Placement and Concurrent
Placement, and the intended participation of management and directors
of Newmarket in the Private Placement and Concurrent Placement, and are
based on Newmarket and Crocodile Gold's current internal expectations,
estimates, projections, assumptions and beliefs, which may prove to be
incorrect. Some of the forward-looking statements may be identified by
words such as "will", "expects", "anticipates", "believes", "projects",
"plans", and similar expressions. These statements are not guarantees
of future performance and undue reliance should not be placed on them.
Such forward-looking statements necessarily involve known and unknown
risks and uncertainties, which may cause Newmarket, Crocodile Gold or
NewCo's actual performance and financial results in future periods to
differ materially from any projections of future performance or results
expressed or implied by such forward-looking statements. These risks
and uncertainties include, but are not limited to: the financial
markets generally and the ability of Newmarket and the Underwriters to
effectively market and complete the Private Placement on the terms
described herein or at all; liabilities inherent in mine development
and production; geological, mining and processing technical problems;
NewCo's inability to obtain required mine licences, mine permits and
regulatory approvals required in connection with mining and mineral
processing operations; competition for, among other things, capital,
acquisitions of reserves, undeveloped lands and skilled personnel;
incorrect assessments of the value of acquisitions; changes in
commodity prices and exchange rates; currency and interest rate
fluctuations; various events that could disrupt operations and/or the
transportation of mineral products, including labour stoppages and
severe weather conditions; the demand for and availability of rail,
port and other transportation services; the ability to secure adequate
financing, the risk that management and directors of Newmarket may not
ultimately participate in the private placement to the extent
anticipated, and management's ability to anticipate and manage the
foregoing factors and risks. There can be no assurance that
forward-looking statements will prove to be accurate, and actual
results and future events could differ materially from those
anticipated in such statements. Newmarket and Crocodile Gold undertake
no obligation to update forward-looking statements if circumstances or
management's estimates or opinions should change except as required by
applicable securities laws. The reader is cautioned not to place undue
reliance on forward-looking statements.
Completion of the Transaction is subject to a number of conditions,
including TSX Venture Exchange acceptance and disinterested Newmarket
shareholder approval. The Transaction cannot close until the required
shareholder approval is obtained. There can be no assurance that the
Transaction will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the management
information circulars to be prepared in connection with the
Transaction, any information released or received with respect to the
Transaction may not be accurate or complete and should not be relied
upon. Trading in the securities of Newmarket and Crocodile Gold should
be considered highly speculative.
The TSX Venture Exchange has in no way passed upon the merits of the
proposed Transaction and has neither approved nor disapproved the
contents of this press release.
This news release does not constitute an offer to sell or a solicitation
of an offer to buy any of the securities in the United States, nor shall there be any sale of these securities in any jurisdiction in
which such offer, solicitation or sale would be unlawful. The
securities have not been and will not be registered under the United
States Securities Act of 1933, as amended (the "U.S. Securities Act")
or any state securities laws and may not be offered or sold within the
United States or to U.S. Persons unless registered under the U.S.
Securities Act and applicable state securities laws or an exemption
from such registration is available.
SOURCE Newmarket Gold Inc.
For further information:
Newmarket Gold Inc.
President & Chief Executive Officer