NewCastle Gold Ltd.
TSX VENTURE : NCA

NewCastle Gold Ltd.
Catalyst Copper Corp.
TSX VENTURE : CCY

Catalyst Copper Corp.

May 26, 2016 09:26 ET

NewCastle Gold Completes Merger with Catalyst Copper

TORONTO, ONTARIO--(Marketwired - May 26, 2016) - NewCastle Gold Ltd. (TSX VENTURE:NCA) (the "Company" or "NewCastle") and Catalyst Copper Corporation (TSX VENTURE:CCY) ("Catalyst") are pleased to announce that they have completed their previously announced merger. NewCastle, the continuing public company, will be anchored by the substantially permitted Castle Mountain Gold Project ("Castle Mountain") located in California, with the goal of creating a new mid-tier gold company.

Highlights of the strengthened NewCastle include:

  • Highly-experienced board and management team with a proven record of success to maximize the value of Castle Mountain
  • Operational strength and access to extensive project and technical skills including United States permitting matters to supplement and strengthen the existing management team
  • Extensive capital markets experience
  • Infusion of capital to initiate a drill program to help determine the potential of Castle Mountain

The new Board of Directors consists of Richard Warke, as Executive Chairman, David Adamson, Mark Wayne, David Reid, Jim Gowans, Frank Giustra and Colin Sutherland. Officers of the Company are David Adamson - President and Chief Executive Officer, Paul Ireland - Chief Financial Officer, Ian Cunningham-Dunlop - Vice President Exploration, Marty Tunney - Vice President Corporate Development and Purni Parikh - Vice President Corporate Secretary.

The Company would like to thank Messrs. Buchan, Cavalluzzo, Morales and Napier for their contributions to the success of the Company and wish them all the best in their future endeavors.

The Company's new Executive Chairman, Richard Warke, stated, "With the strength of our board and management team, and the high quality Castle Mountain gold project, the Company is well positioned to drive towards its goal of creating a new mid-tier gold company." David Adamson, Chief Executive Officer of NewCastle, added, "I look forward to working with the new members of the board and management team. With a topped up treasury, we plan to have drills turning on the project in the very near term to determine the full potential of the project."

In connection with the closing of the merger, Catalyst completed a private placement of 1,309,090 Catalyst Shares (with a hold period expiring on September 21, 2016), which shares were exchanged for NewCastle Shares. The Company expects to complete the previously announced transaction with Franco-Nevada shortly, which upon closing will result in the Company having approximately $6.5 million in cash.

Pursuant to the merger, all of the common shares of Catalyst ("Catalyst Shares") were exchanged for common shares of NewCastle ("NewCastle Shares") on the basis of one NewCastle Share for each Catalyst Share. The combined Company has 151,442,443 issued and outstanding shares.

Stock Options

In connection with the merger, the Board of Directors has conditionally granted the following options (the "New Options"):

  • An aggregate of 6,565,000 New Options to certain officers, directors and consultants of the Company exercisable for five years at an exercise price of $0.54, based on the closing of price of NewCastle Shares on May 25, 2016. These New Options vest in equal installments every year for a three year period.
  • An aggregate of 150,000 New Options to certain employees of the Company, exercisable for five years at an exercise price of $0.54, based on the closing of price of NewCastle Shares on May 25, 2016. These New Options vest in equal installments every six months for an 18-month period.

As the number of NewCastle Shares reserved for issuance under the options is in excess of the number available under the Company's existing fixed stock option plan, the Company has adopted a new 10% rolling stock option plan (the "2016 Option Plan") to provide for the grant of the New Options.

The aggregate number of NewCastle Shares which may be reserved for issuance pursuant to the 2016 Option Plan and all other share compensation arrangements (including the Company's existing fixed stock option plan) cannot exceed 10% of the number of NewCastle Shares issued and outstanding from time to time. The 2016 Option Plan also contains restrictions on the number of NewCastle Shares which may be reserved for issuance to any one participant, and to insiders of the Company as a group.

Under TSX Venture Exchange rules, the adoption of the 2016 Option Plan and the grant of the New Options requires the approval of the TSX Venture Exchange rules and approval by disinterested shareholders. At the annual general meeting to be held on June 30, 2016, shareholders will be asked to consider and, if thought fit, approve the adoption of the 2016 Option Plan and the grant of the New Options. Detailed information concerning the 2016 Option Plan and the New Options will be contained in the management information circular distributed in connection with the annual general meeting. The New Options may not be exercised unless and until such shareholder approval is obtained

Annual General Meeting

The Company also announces that the Annual General Meeting of Shareholders will be held on June 30, 2016 at 10:30 a.m. (Toronto time) at the Toronto Board of Trade, 77 Adelaide Street West, Toronto, Ontario, M5X 1C1.

About NewCastle

NewCastle has 100% of the right, title and beneficial interest in and to the Castle Mountain Venture, a California general partnership, which owns the Castle Mountain property (the "Project") in San Bernardino County, California. The Castle Mountain heap leach gold mine produced over one million ounces of gold from 1992 to 2001, when mining was suspended due to low gold prices. The Mine and Reclamation Plan, under which the mine operated, was authorized by the County of San Bernardino as the Lead Agency and remains in effect. Water for the drill programs is accessed from existing patented wells on the Project.

An updated NI 43-101 resource for the project was announced December 2, 2015 which includes Measured Mineral Resources of 17.4 million tonnes grading 0.86 g/t gold containing 0.48 million gold ounces, Indicated Mineral Resources of 202.5 million tonnes grading 0.57 g/t gold containing 3.71 million gold ounces along with Inferred Mineral Resources of 40.8 million tonnes grading 0.58 g/t gold and containing 0.76 million gold ounces. The Project hosts a disseminated low sulphidation epithermal system. Gold is primarily hosted by late-stage rhyolite volcanic units within zones of silicification and brecciation associated with northeast-southwest trending/southeast dipping fault structures which are interpreted to have developed within a collapsed caldera environment. Eleven gold domains are represented by both steep and shallow-dipping orientations.

Ian R. Cunningham-Dunlop, P. Eng., the Company's Vice President Exploration, is the designated Qualified Person for this news release within the meaning of NI 43-101. He has reviewed and verified that the technical information contained in this release is accurate and has approved of the written disclosure of the same.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

Forward-Looking Statements

Statements contained in this news release that are not historical facts are "forward-looking information" or "forward-looking statements" (collectively, "Forward-Looking Information") within the meaning of applicable Canadian securities legislation and the United States Private Securities Litigation Reform Act of 1995. Forward Looking Information includes, but is not limited to, disclosure regarding possible events, conditions or financial performance that is based on assumptions about future economic conditions and courses of action; the timing and costs of future exploration and testing activities on the Company's properties; success of exploration activities; time lines for technical reports; planned exploration and development of properties and the results thereof; and planned expenditures and budgets and the execution thereof. Statements concerning Mineral Resource estimates may also be deemed to constitute forward looking information to the extent that they involve estimates of the mineralization that will be encountered if the property is developed. In certain cases, Forward-Looking Information can be identified by the use of words and phrases such as "plans", "expects" or "does not expect", "is expected", budget", "scheduled", "suggest", "optimize", "estimates", "forecasts", "intends", "anticipates", "potential" or "does not anticipate", believes", "anomalous" or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". In making the forward-looking statements in this news release, the Company has applied several material assumptions, including, but not limited to, that the current testing and other objectives concerning the Castle Mountain project can be achieved and that its other corporate activities will proceed as expected; that the current price and demand for gold will be sustained or will improve; that general business and economic conditions will not change in a materially adverse manner and that all necessary governmental approvals for the planned exploration on the Castle Mountain project will be obtained in a timely manner and on acceptable terms; the continuity of the price of gold and other metals, that the Company's existing patented and unpatented land has not been altered by any designation under U.S. Federal statute or other laws and economic and political conditions and operations.

Forward-Looking Information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the Forward-Looking Information. Such risks and other factors include, among others, obtaining financing on commercially reasonable terms, operations and contractual obligations; changes in exploration programs based upon results of exploration; future prices of metals; availability of third party contractors; availability of equipment; failure of equipment to operate as anticipated; accidents, effects of weather and other natural phenomena and other risks associated with the mineral exploration industry; environmental risks, including environmental matters under U.S. federal and California rules and regulations; impact of environmental remediation requirements and the terms of existing and potential consent decrees on the Company's planned exploration on the Castle Mountain project; certainty of mineral title; community relations; delays in obtaining governmental approvals or financing; fluctuations in mineral prices; the Company's dependence on one mineral project; the nature of mineral exploration and mining and the uncertain commercial viability of certain mineral deposits; the Company's lack of operating revenues; governmental regulations and the ability to obtain necessary licenses and permits; risks related to mineral properties being subject to prior unregistered agreements, transfers or claims and other defects in title; impacts to patented and unpatented land by designation under U.S.
Federal Statute or other laws, currency fluctuations; changes in environmental laws and regulations and changes in the application of standards pursuant to existing laws and regulations which may increase costs of doing business and restrict operations; risks related to dependence on key personnel; and estimates used in financial statements proving to be incorrect; as well as those factors discussed in the Company's public disclosure record. Although the Company has attempted to identify important factors that could affect the Company and may cause actual actions, events or results to differ materially from those described in Forward-Looking Information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that Forward-Looking Information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on Forward-Looking Information. Except as required by law, the Company does not assume any obligation to release publicly any revisions to Forward-Looking Information contained in this news release to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Readers should refer to the Company's Annual Information Form and Management Discussion and Analysis for the year ended December 31, 2015 as well as the Company's most recent Management Discussion and Analysis, available on www.sedar.com.

Cautionary Note Concerning Estimates of Inferred and Indicated Resources

This news release uses the terms "Inferred Resources" and "Indicated Resources", which have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an Inferred and/or Indicated Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Resources may not form the basis of feasibility or prefeasibility studies. NewCastle advises U.S. investors that while this term is recognized by Canadian regulations, the U.S. Securities and Exchange Commission does not recognize it. U.S. investors are cautioned not to assume that part or all of an Inferred or Indicated resource exists, or is economically or legally minable.

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