NEWMARKET GOLD ANNOUNCES COMPLETION OF THE ARRANGEMENT WITH CROCODILE GOLD
July 10, 2015
Vancouver: July 10, 2015 – Newmarket Gold Inc. (“Newmarket Gold” or the “Company”) (TSX:NMI) is pleased to announce the completion of its previously announced plan of arrangement (the “Arrangement”) involving Newmarket Gold Inc. (“Newmarket”) and Crocodile Gold Corp. (“Crocodile Gold”) under the Business Corporations Act (Ontario), pursuant to which Newmarket and Crocodile Gold have combined to create a new gold industry consolidator solidly positioned to acquire high quality gold assets in the world’s most desirable mining jurisdictions. In addition, immediately prior to the closing of the Arrangement, the proceeds of Newmarket’s previously completed C$25 million subscription receipt financing were released from escrow and the underlying Company common shares have been issued. C$20 million of the proceeds are being used to fund the cash consideration payable to former Crocodile Gold shareholders who elected to receive cash in connection with the Arrangement, and the remaining C$5 million of the proceeds will be used to bolster the working capital position of the Company.
The Arrangement is expected to provide significant benefits for shareholders, including the creation of a strong gold producing company with enhanced capital markets exposure and access to capital. The Company will benefit from Crocodile Gold’s strong asset base, excellent operating team, established gold production of over 200,000 ounces per year and track record of free cash flow generation from the Fosterville, Stawell and Cosmo underground gold mines in Australia.
As of June 30, 2015, the Company had a pro-forma cash and bullion balance (at fair market value) of approximately US$39.4 million, before proceeds from the subscription receipt financing and all transaction costs associated with the Arrangement. Following completion of the Arrangement, Newmarket has approximately 134.2 million common shares issued and outstanding and Luxor Capital Group LP (“Luxor”) now controls approximately 41.6% of Newmarket Gold on an issued and outstanding basis. As per the terms of the lock-up agreement entered into by Luxor, Luxor has agreed not to dispose of more than 20% of the securities of Newmarket Gold it owns for a period of 12 months. The common shares of Newmarket Gold have been conditionally approved to trade on the Toronto Stock Exchange (“TSX”) and it is expected that the common shares will commence trading on the TSX under the new symbol “NMI” on or about July 14, 2015.
Douglas Forster, President and Chief Executive Officer, Newmarket Gold, stated: “Today, by completing our merger with Crocodile Gold, the Company moves forward with a solid foundation of quality gold production, free cash flow generation and a large gold resource base that supports the execution of our ongoing gold asset consolidation strategy. With our outstanding senior management team, a proven operating team and a board of directors with tremendous industry experience, the Company is focused on creating substantial shareholder value through continued sustainable operating performance from our three existing operations and through advancing our disciplined approach to growth. I would like to thank our employees and contractors for their dedication and service, our management team and board of directors and also the shareholders of both Crocodile Gold and Newmarket for their overwhelming support of the transaction.”
The management team and senior staff of the Company draws from the extensive expertise of both Newmarket and Crocodile Gold and includes:
Raymond Threlkeld: Non-Executive Chairman
Douglas Forster, M.Sc., P.Geo.: President and Chief Executive Officer
Rodney Lamond, P.Eng.: Chief Operating Officer
Blayne Johnson: Executive Vice President
Robert Dufour, CA, CPA: Chief Financial Officer
Douglas Hurst, B.Sc.: Vice President Corporate Development
Jason Gregg, BBA, MBA: Vice President Human Resources and Environment, Health and Safety
Ryan King: Vice President Corporate Communications
Paulo Santos, CA: Treasurer and Corporate Secretary
Laura Lepore: Director, Investor Relations
The Company has also assembled an experienced board of directors with a proven track record of substantial shareholder value creation. The board is comprised of seven directors including: Raymond Threlkeld, Douglas Forster, Blayne Johnson, Lukas Lundin, Randall Oliphant, Robert Getz and Kevin Conboy.
The Company’s Australian operations team is headed by a seasoned group of industry professionals including:
Ian Holland, General Manager, Fosterville Gold Mine
Jason Morin, General Manager, Cosmo Gold Mine
Troy Cole, General Manager, Stawell Gold Mine
Mark Edwards, General Manager, Exploration
Financial and Legal Advisors
Newmarket retained GMP Securities L.P. to act as financial advisor and Cassels Brock & Blackwell LLP to act as legal advisor.
Crocodile Gold retained Salman Partners Inc. to act as financial advisor and Bennett Jones LLP to act as legal advisor.
ON BEHALF OF THE BOARD
Douglas Forster, M.Sc., P.Geo.
President & Chief Executive Officer