New Gold Announces 14.9% Investment in Harte Gold
March 19 2021 - 7:48AM
Business Wire
(All dollar figures are in Canadian dollars unless otherwise
indicated)
March 19, 2021-- New Gold Inc. (“New Gold” or the
“Company”) (TSX and NYSE American: NGD) announced today that it
has agreed to purchase 154,940,153 common shares of Harte Gold
Corp. (TSX: HRT / OTC: HRTFF / Frankfurt: H4O) (“Harte
Gold”) pursuant to a private placement at a price of $0.16 per
share for total consideration of approximately $24.8 million (the
“Private Placement”) providing New Gold with a 14.9%
strategic interest in Harte Gold’s pro forma issued and outstanding
common shares. Closing of the transaction is expected to occur on
or about March 24, 2021 and is subject to certain conditions.
In connection with the closing of the transaction, New Gold and
Harte Gold will enter into an investor rights agreement (the
“Investor Rights Agreement”) pursuant to which New Gold
will, as long as New Gold holds not less than 10% of the issued and
outstanding common shares of Harte Gold, have the right to: (i)
participate in certain equity financings by Harte Gold in order to
maintain its 14.9% interest in Harte Gold; and (ii) commencing at
Harte Gold’s 2022 annual meeting of shareholders, nominate one
person (and in the case of an increase in the size of the board of
directors of Harte Gold to 9 or more directors, two persons) to the
board of directors of Harte Gold. Under the Investor Rights
Agreement, New Gold will be subject to an 18-month standstill which
will prohibit New Gold from taking certain actions, including
acquiring more than 14.9% of the issued and outstanding common
shares of Harte Gold, subject to certain exceptions.
In exchange for waiving the (i) right to receive up to 35% of
the net proceeds of the Private Placement for debt repayment under
the August 28, 2020 facility agreement (“Appian Facility”)
between Harte Gold and AHG (Jersey) Limited; and (ii) participation
right under the November 23, 2016 subscription agreement between
Harte Gold and ANR Investments B.V. (“Appian”), Harte Gold
will grant to Appian a deferred participation warrant that will
allow Appian to acquire up to 55,802,812 common shares of Harte
Gold at $0.18 per common share for a period of 15 months following
the closing of the Private Placement (the “Appian Deferred
Participation Warrant”). The Appian Deferred Participation
Warrant is not exercisable by Appian, subject to certain
exceptions, for a period of 12 months following the closing of the
Private Placement. New Gold will also be granted a warrant which
provides New Gold with the right, subject to Appian exercising the
Appian Deferred Participation Warrant, to acquire up to 8,314,619
additional Common Shares at $0.18 per common share in order to
maintain its pro rata interest in the Company.
New Gold is acquiring the common shares for investment purposes.
Depending on market conditions and other factors, New Gold may,
from time to time, acquire additional common shares or other
securities of Harte Gold or dispose of some or all of the common
shares or other securities of Harte Gold that it owns at such
time.
An early warning report will be filed by New Gold in accordance
with applicable securities laws.
About New Gold Inc.
New Gold is a Canadian-focused intermediate mining Company with
a portfolio of two core producing assets in Canada, the Rainy River
gold mine and the New Afton copper-gold mine. The Company also
holds an 8% gold stream on the Artemis Gold Blackwater project
located in British Columbia and a 6% equity stake in Artemis. The
Company also operates the Cerro San Pedro Mine in Mexico (in
reclamation). New Gold’s vision is to build a leading diversified
intermediate gold Company based in Canada that is committed to
environment and social responsibility. For further information on
the Company, visit www.newgold.com.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain information contained in this news release, including
any information relating to New Gold’s future financial or
operating performance are “forward-looking”. All statements in this
news release, other than statements of historical fact, which
address events, results, outcomes or developments that New Gold
expects to occur are “forward-looking statements”. Forward-looking
statements are statements that are not historical facts and are
generally, but not always, identified by the use of forward-looking
terminology such as “plans”, “expects”, “is expected”, “budget”,
“scheduled”, “targeted”, “estimates”, “forecasts”, “intends”,
“anticipates”, “projects”, “potential”, “believes” or variations of
such words and phrases or statements that certain actions, events
or results “may”, “could”, “would”, “should”, “might” or “will be
taken”, “occur” or “be achieved” or the negative connotation of
such terms. Forward-looking statements in this news release
include, among others, statements with respect to:: statements
relating to the expected closing date of the transaction; New
Gold’s ownership interest in Harte Gold upon closing of the
transaction; New Gold’s acquisition or disposition of securities of
Harte Gold 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 New
Gold 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. New Gold expressly disclaims any
intention or obligation to update or revise any forward-looking
statements whether as a result of new information, events or
otherwise, except in accordance with applicable securities
laws.
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version on businesswire.com: https://www.businesswire.com/news/home/20210319005259/en/
Anne Day Vice President, Investor Relations Direct: +1 (416) 324
6003 Email: anne.day@newgold.com
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