Apollo Gold and Linear Gold Enter into Definitive Arrangement Agreement
April 01 2010 - 08:00AM
Business Wire
Apollo Gold Corporation (TSX: APG) (NYSE Amex: AGT) (“Apollo”)
and Linear Gold Corp. (TSX: LRR) (“Linear”) are pleased to announce
today that they have entered into a definitive arrangement
agreement (the “Arrangement Agreement”) in respect of the
previously announced business combination (the “Merger”) pursuant
to which the businesses of Apollo and Linear will be combined by
way of a court approved plan of arrangement. The Arrangement
Agreement supercedes the letter of intent executed by Apollo and
Linear on March 9, 2010 in respect of the Merger.
Wade Dawe, Chief Executive Officer (“CEO”) and President of
Linear, who will be appointed as CEO and President of the combined
company, said, “The signing of the Arrangement Agreement is another
step towards closing of the Merger which will create an emerging
Canadian mid-tier gold producer. Our new company will be well
positioned as the new gold investment vehicle of choice for
investors seeking growing gold production in Canada, increasing
gold mineral resources, a financially strong balance sheet and a
superior pipeline of projects in politically stable
jurisdictions.”
R. David Russell, CEO and President of Apollo, added, “Both
Apollo and Linear are working together to complete the Merger as
well as prepare for a smooth transition to start a new chapter for
the combined company in 2010. This year also marks the first full
year of production from the Black Fox Mine in the Timmins Mining
District, including the start of production from the new
underground mine in the second half of 2010.”
The consummation of the Merger as contemplated by the
Arrangement Agreement is subject to a number of conditions
precedent, including approval of the shareholders of each of Apollo
and Linear. The parties currently anticipate that the Merger will
be completed in June 2010. It is expected that proxy and management
information circulars will be mailed to respective Apollo and
Linear shareholders in May 2010.
About Apollo
Apollo is a growing gold producer that operates the wholly owned
Black Fox Mine in Ontario, Canada, which commenced gold production
in May 2009. In 2010, Apollo expects to produce approximately
100,000 ounces of gold from its Black Fox Mill at total cash costs
between US$500 and US$550 per ounce produced. Apollo is also
exploring the adjoining Grey Fox and Pike River properties, all in
the Timmins gold district in Ontario, Canada, as well as the
Huizopa Joint Venture, (80 percent Apollo and 20 percent Minas De
Coronado, S. de R.L. de C.V.), an early stage, gold-silver
exploration project, approximately 16 kilometers (10 miles)
southwest of Minefinders Dolores gold-silver mine, in the Sierra
Madres in Chihuahua, Mexico.
About Linear
Linear Gold Corp is a well financed gold exploration and
development company committed to maximizing shareholder value
through a strategy of mine development, focused exploration, and
effective risk management through selective partnerships and
acquisitions. Linear's flagship development property located near
Uranium City, Saskatchewan, hosts an economic gold deposit and is
now in the development stage to become a 70,000 - 90,000 ounce per
year gold producer. Linear also holds an extensive and diverse
portfolio of mineral projects in the Dominican Republic and
Mexico.
Forward-looking Statements
Certain statements in this press release relating to the
proposed Merger are “forward-looking statements” within the meaning
of securities legislation. These statements include statements
regarding completion of the Merger, future gold production,
increasing gold resources, the development of the Goldfields
Project’s Box gold deposit and initial production therefrom,
production from Black Fox, the development of an underground mine
at Black Fox and combined company's position as an investment
vehicle. The companies do not intend, and do not assume any
obligation, to update these forward-looking statements. These
forward-looking statements represent management's best judgment
based on current facts and assumptions that management considers
reasonable, including that the required approval will be obtained
from the shareholders of Apollo or Linear, that all third party
regulatory and governmental approvals to the Merger will be
obtained and all other conditions to completion of the Merger will
be satisfied or waived, that operating and capital plans will not
be disrupted by issues such as mechanical failure, unavailability
of parts, labour disturbances, interruption in transportation or
utilities, or adverse weather conditions, that there are no
material unanticipated variations in budgeted costs, that
contractors will complete projects according to schedule, and that
actual mineralization on properties will not be less than
identified mineral reserves. The companies make no representation
that reasonable business people in possession of the same
information would reach the same conclusions. Forward-looking
statements involve known and unknown risks, uncertainties and other
factors which may cause the actual results, performance or
achievements of the companies to be materially different from any
future results, performance or achievements expressed or implied by
the forward-looking statements. In particular, fluctuations in the
price of gold or in currency markets could prevent the companies
from achieving their targets. Other factors are disclosed under the
heading “Risk Factors”, “Risks and Uncertainties” and elsewhere in
Apollo and Linear documents filed from time to time with the
Toronto Stock Exchange, on SEDAR and with other regulatory
authorities, and Apollo documents filed with the NYSE Amex Equities
Exchange and the United States Securities and Exchange Commission
(the “SEC”).
Additional Information and Where to Find It
In connection with Apollo’s and Linear’s solicitation of proxies
with respect to the meeting of shareholders of each of Apollo and
Linear to be called with respect to the proposed Merger, Apollo
will file a proxy statement with the SEC and with regulatory
authorities in Canada and Linear will file an information circular
with regulatory authorities in Canada. SHAREHOLDERS ARE ADVISED TO
READ THE PROXY STATEMENT/INFORMATION CIRCULAR WHEN IT IS FINALIZED
AND DISTRIBUTED TO SHAREHOLDERS BECAUSE IT WILL CONTAIN IMPORTANT
INFORMATION. Shareholders will be able to obtain a free-of-charge
copy of Apollo’s proxy statement (when available) and other
relevant documents filed with the SEC and with regulatory
authorities in Canada from the SEC’s website at http://www.sec.gov
and from SEDAR at http://www.sedar.com, as applicable. Shareholders
will be able to obtain a free-of-charge copy of Linear’s
information circular (when available) and other relevant documents
filed with regulatory authorities in Canada on SEDAR at
http://www.sedar.com. Shareholders of Apollo will also be able to
obtain a free-of-charge copy of the proxy statement and other
relevant documents (when available) by directing a request by mail
or telephone to Apollo Gold Corporation, 5655 South Yosemite St.,
Suite 200, Greenwood Village, Colorado 80111-3220 or (720)
886-9656, or from Apollo’s website, www.apollogold.com.
Shareholders of Linear will also be able to obtain a free-of-charge
copy of the information circular and other relevant documents (when
available) by directing a request by mail or telephone to Linear
Gold Corp., Suite 502, 2000 Barrington Street, Halifax, Nova Scotia
B3J 3K1 or (902) 422-1421, or from Linear’s website,
www.lineargoldcorp.com.
Interests of Participants in the Solicitation of
Proxies
Apollo and certain of its directors, executive officers and
other members of its management and employees may, under the rules
of the SEC, be deemed to be “participants” in the solicitation of
proxies from its shareholders in connection with the proposed
merger. Information concerning the interests of the persons who may
be considered “participants” in the solicitation is set forth in
Apollo’s proxy statements and Annual Reports on Form 10-K
(including any amendments thereto), previously filed with the SEC,
and in the proxy statement relating to the plan of arrangement when
it becomes available. Copies of these documents can be obtained,
without charge, at the SEC’s internet website at www.sec.gov or by
directing a request to Apollo at the address above.
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