Newcastle Gold Ltd.

Operating Gold Mines - Quebec & Peru Canadian Gold Producer with significant GOLD Reserves

about 9 years ago

NewCastle Gold Amends Payment Terms With Sprott Resource

TORONTO, ONTARIO – September 2, 2015 – NewCastle Gold Ltd. ("NewCastle" or the "Company") – TSX VENTURE: NCA; OTCQX: CTMQF) is pleased to announce that the Company and Sprott Resource Lending Corp. (“Sprott”) have amended the future property payment terms under the share purchase agreement dated September 6, 2012, pursuant to which NewCastle acquired the Castle Mountain Venture. NewCastle and Sprott have agreed to amend the payment terms as follows:

The second payment, originally due to Sprott on September 8, 2015, will now be due on February 1, 2016 (the “Second Payment”).

The amount of the Second Payment is increased by 5% from C$3,000,000 to C$3,150,000, payable in cash, shares or both at the election of the Company.

The third and final payment of C$5,000,000 remains due to Sprott on September 6, 2018 (the “Third Payment”) unless, at any time following September 6, 2017, NewCastle’s share price based on its 20 day VWAP exceeds $0.65, in which case the Third Payment becomes immediately due. The Third Payment is payable in cash, shares or both at the election of the Company.

If either the Second Payment or the Third Payment is satisfied by the Company with shares, the market price of such shares will be calculated using NewCastle’s share price based on its 20 day VWAP (excluding up to nine non-trading days) prior to the date of such payment. If there are more than nine non trading days in the 20 day period then the VWAP is calculated as the average of (i) the average of the closing bid and ask prices for each day on which there was no trading, and (ii) the VWAP for the days on which there has been trading.

If, at any time prior to September 6, 2018, the Castle Mountain property is sold, leased or optioned or if the Company incurs debt out of the ordinary course or completes a debt financing, the Second Payment (if not already made) and the Third Payment become due to Sprott and must be satisfied in cash.

David Adamson, the Chief Executive Officer of NewCastle, commented “This amendment provides time, at a reasonable cost, for NewCastle to continue to advance the Castle Mountain project and to explore funding options designed, as much as practicable, to minimize share dilution. It establishes a share price beginning in September 2017 that allows us flexibility regarding the timing of the Third Payment, should the Company attain what we believe to be a more realistic valuation of its assets”.

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 in San Bernardino County, California, (7,458 acres in total). 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.

A National Instrument 43-101 Technical Report for the initial mineral resource estimate prepared by RPA Inc. was filed on December 11, 2013. The resource estimate is 182 Mt grading 0.6 g/t Au for 3.15 million ounces in the Indicated category and 63.7 Mt grading 0.57 g/t Au for 1.06 million ounces of gold in the Inferred category. Resources were calculated using a cut-off of 0.14 g/t gold. On June 5, 2014, the Technical Report for its Preliminary Economic Assessment, prepared by RPA Inc., was filed. Static case economics, at a gold price of $1300/oz, show an NPV (5% discount rate) of $122 million and post-tax IRR of 29.7%. Both documents are available on SEDAR at www.sedar.com and on the Company's website at www.newcastlegold.ca. The Mineral Resource estimate and other scientific and technical information contained in this news release were prepared by or under the supervision of Jason Cox, P.Eng. and Mr. Reno Pressacco, M.Sc. (Applied), P.Geo. of RPA Inc., who are each an independent “Qualified Person” under National Instrument 43-101 Standards of Disclosure for Mineral Projects.

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 release.

For further information, please contact:

NewCastle Gold Ltd.
Marty Tunney
Tel: 416-572-0151
Email: mtunney@newcastlegold.ca