/NOT FOR DISTRIBUTION TO
Summary:
- Exploration driven value creation at the
Moss Mine andHercules Project . - Solid foundation of production and growing cash flow.
- Strong pro-forma balance sheet with a cash position of
~C$29 million . - Optimization ongoing at the
Moss Mine to enhance cash flows. - Combination of two highly capable leadership, operations and exploration teams.
Transaction Highlights
- Concurrent "best efforts" private placement of subscription receipts by Eclipse for minimum gross proceeds of
C$20 million to be led by Stifel GMP on behalf of a syndicate of agents includingCanaccord Genuity Corp. ,Raymond James Ltd. ,Beacon Securities Limited , andPI Financial Corp. - Exchange ratio for existing common shares of Eclipse of 1.09 shares of Northern Vertex for every one share of Eclipse, determined based on the 20-day VWAP of each company on
December 4 th, 2020. - Combined company will be comprised of 71% Northern Vertex shareholders, 18% Eclipse shareholders and 11% new shareholders.
- Joining the Board of Directors of Northern Vertex from Eclipse will be
Douglas J. Hurst andMarcel de Groot .Mr. Hurst will serve as Chairman of Northern Vertex and lead the integrated Board and management team. - Accelerated corporate growth will be supported by the
Moss Mine's production and cash flow, and a bolstered balance sheet. - Shareholders of the combined company gain leverage to resource growth at greater scale with accelerated drilling at both the
Moss Mine andHercules Gold project.
Northern Vertex President, CEO and Director Mr.
Eclipse President, CEO and Director
Board and Management Team
The combined company will feature a new integrated Board of Directors comprised of
The management team will be comprised of President and CEO
Transaction Details
Eclipse and Northern Vertex, who are arms length to each other, have entered into an Arrangement Agreement dated
All outstanding stock options and warrants of Eclipse will be exchanged for stock options or warrants of Northern Vertex on the same basis as the share exchange ratio for the common shares.
The Transaction will be carried out by way of a court-approved plan of arrangement under the Business Corporations Act (
It is expected that the special meeting of Eclipse shareholders to approve the proposed Transaction will be held in
The Arrangement Agreement includes customary provisions, including mutual non-solicitation, right-to-match and fiduciary out provisions, as well as certain representations, covenants and conditions that are customary for a transaction of this nature. A termination fee of
Further information regarding the Transaction will be contained in a management information circular to be prepared by Eclipse and mailed to Eclipse shareholders in connection with a special meeting of shareholders to consider the Transaction. All shareholders of Eclipse are urged to read the information circular once available, as it will contain important additional information concerning the Transaction.
Board Recommendations and Voting Support
The Transaction has been unanimously approved by the board of directors of both Northern Vertex and Eclipse. The board of directors of Eclipse has unanimously recommended that the Eclipse shareholders vote in favour of the Transaction.
All the directors and officers of Eclipse, holding in aggregate approximately 17.3% of the issued and outstanding common shares of Eclipse have entered into customary voting support agreements agreeing to vote in favour of the Transaction.
Stifel GMP has provided a fairness opinion to the board of directors of Eclipse that, as of the date hereof, and based upon and subject to the assumptions, limitations and qualifications stated therein, the consideration being received by the shareholders of Eclipse under the Transaction is fair, from a financial point of view, to the shareholders of Eclipse.
Concurrent Financing
Concurrent with signing the Arrangement Agreement, Eclipse has entered into an agreement with a syndicate of agents led by Stifel GMP and including
The Subscription Receipts will each be automatically converted into one divided by 1.09 of an Eclipse share (the "Eclipse Shares") (for no further consideration and without any further action by the holders thereof) upon the satisfaction of certain escrow release conditions, all of which must occur before
The Northern Vertex shares issued in connection with the closing of both the offering and the Transaction will not be subject to any statutory hold period in Canada.
Maverix Metals Inc. ("Maverix") has agreed to exercise, on or before
The proceeds of the Offering will partly be used to fund the purchase of the Warrant Shares from Maverix (
Advisors and Counsel
Stifel GMP is acting as financial advisor to
Qualified Persons
The foregoing technical information contained in this news release has been reviewed and verified by Mr.
About Northern Vertex
About
ON BEHALF OF THE BOARD OF DIRECTORS OF NORTHERN VERTEX MINING
President, CEO and Director
ON BEHALF OF THE BOARD OF DIRECTORS OF ECLIPSE GOLD MINING
President, CEO and Director
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Cautionary Statement Regarding Forward Looking Information
All statements, trend analysis and other information contained in this press release about anticipated future events or results constitute forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "believe", "plan", "estimate", "expect" and "intend" and statements that an event or result "may", "will", "should", "could" or "might" occur or be achieved and other similar expressions. All statements, other than statements of historical fact, included herein, including, without limitation, statements regarding anticipated benefits of the Transaction, the closing of the Transaction and the Offering, are forward-looking statements. Although Eclipse and Northern Vertex (the "Companies") believe that the expectations reflected in such forward-looking statements and/or information are reasonable, undue reliance should not be placed on forward-looking statements since the Companies can give no assurance that such expectations will prove to be correct. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements, including the risks, uncertainties and other factors identified in the Companies' periodic filings with Canadian securities regulators, and assumptions made with regard to: the Companies' ability to complete the proposed Transaction; the Companies' ability to secure the necessary shareholder, securityholder, legal and regulatory approvals required to complete the Transaction; the ability to complete the Offering; the estimated costs associated with the advancement of the Companies' projects; and the Companies' ability to achieve the synergies expected as a result of the Transaction. Forward-looking statements are subject to business and economic risks and uncertainties and other factors that could cause actual results of operations to differ materially from those contained in the forward-looking statements. Important factors that could cause actual results to differ materially from the Companies' expectations include risks associated with the business of Eclipse and Northern Vertex; risks related to the satisfaction or waiver of certain conditions to the closing of the Transaction; non-completion of the Transaction; risks related to reliance on technical information provided by Eclipse and Northern Vertex; risks related to exploration and potential development of the Companies' projects; business and economic conditions in the mining industry generally; fluctuations in commodity prices and currency exchange rates; uncertainties relating to interpretation of drill results and the geology, continuity and grade of mineral deposits; the need for cooperation of government agencies in the exploration and development of properties and the issuance of required permits; the need to obtain additional financing to develop properties and uncertainty as to the availability and terms of future financing; the possibility of delay in exploration or development programs and uncertainty of meeting anticipated program milestones; uncertainty as to timely availability of permits and other governmental approvals; and other risk factors as detailed from time to time and additional risks identified in Eclipse and Northern Vertex's filings with Canadian securities regulators on SEDAR in
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