Excellon and Otis GOLD Obtain Interim Order FOR Plan of Arrangement
EXCELLON AND OTIS GOLD OBTAIN INTERIM ORDER
FOR PLAN OF ARRANGEMENT
Toronto, Ontario – March 16, 2020 – Excellon Resources Inc. (TSX: EXN, EXN.WT, OTC: EXLLF and FRA:
E4X1) (“Excellon” or the “Company”) and Otis Gold Corp. (TSX-V: OOO, OTC: OGLDF, FRA: 4OG) (“Otis”)
are pleased to announce th e receipt of an interim order from the Supreme Court of British Columbia on
March 13, 2020 (the “Interim Order”), in connection with Excellon’s previously announced acquisition of
all of the issued and outstanding shares of Otis (the “Otis Shares ”) pursuant to a plan of arrangement
under the Business Corporations Act (British Columbia) (the “Arrangement”). The Interim Order provides
for, among other things, a meeting of Otis shareholders to consider and vote upon the Arrangement.
Arrangement
On February 24, Excellon entered into a definitive arrangement agreement (the “Arrangement
Agreement”) with Otis , whereby, subject to the terms and conditions of the Arrangement Agreement,
Excellon will acquire all of the Otis Shares on the basis of 0.23 of an Excellon common share (an “Excellon
Share”) for each Otis Share (the “Exchange Ratio”).
Benefits of the Arrangement
Excellon and all of its subsidiaries immediately following the completion of the Arrangement (the
“Combined Company ”) will be a well -financed precious metals producer with established silver
production in Mexico and an attractive gold development project in the United States . The Arrangement
is an initial step in Excellon becoming a larger multi -asset precious metals company with the following
foundation for further growth:
• Enhanced portfolio of projects: The Arrangement combines Platosa’s high-grade silver production
with the high return and low risk Kilgore development project, creating a pipeline for growth.
Furthermore, it adds two significantly undervalued gold assets, Kilgore and Oakley, to Excellon ’s
portfolio and amplifies the Combined Company’s exposure to precious metals in the early stages
of an anticipated bull market.
• Significant exploration upside : Active exploration on four key mineral trends including the CRD
and Fresnillo epithermal silver trends in Mexico, the re -emerging Idaho gold region, and the
historic Freiberg district in Saxony, all known for multi-million ounce precious metal discoveries.
• Geographic diversification: Diverse, well-established mining jurisdictions across two continents,
reducing single asset risk and positioning the Combined Company for further growth in North
America.
• Enhanced capital market profile: The Combined Company will be well financed with US$10 million
in cash and available funds, with a pro forma combined market capitalization of approximately
C$122 million (based on the basic outstanding shares of the Combined Company after giving effect
to the Exchange Ratio and the price of the Excellon Shares immediately prior to the announcement
of the Arrangement) and will be listed on the TSX. The Combined Company also intends to apply
for a listing on the NY SE American LLC stock exchange (“NYSE American ”) in the United States
which may increase its capital markets presence, trading liquidity and shareholder base.
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• Re-rating potential: Expanded resource base and production growth profile of the Combined
Company is expected to demand a more attractive valuation and provide re-rating potential in
line with larger precious metals peers.
• Proven board and management : Board and management that can discover, permit, finance,
develop and operate mining assets to industry leading standards, with proven experience in North
America.
The shareholders’ meetings to approve the Arrangement for each of Excellon and Otis will be held on
April 17, 2020 with the record date set on March 13, 2020. Additional information about the Meetings will
be included in a joint management information circular of Excellon and Otis (the “Circular”), which is
expected to be filed on or about March 19, 2020 with materials to be mailed to shareholders of Excellon
and Otis shortly thereafter. The Circular, letter of transmittal and related proxy materials will, in due
course, be available on each of Otis’ and Excellon’s websites and SEDAR profiles. The Arrangement i s
expected to be completed in late April 2020.
Shareholder Questions
If you have any questions regarding the Arrangement please contact Laurel Hill Advisory Group, the proxy
solicitation agent for Excellon and Otis , by telephone at: 1 -877-452-7184 (North American Toll Free) or
416-304-0211 (Outside North America); or by email at: [email protected]
Closing of Sprott Bridge-Loan
Excellon is also please d to announce the closing of the previously announced US$6-million bridge-loan
credit facility (the “Facility”) with Sprott Private Resource Lending II (Collector), LP (“Sprott Lending”). The
Facility bears interest at 10% per annum, compounded and payable monthly, and due and payable in full
on or before September 14, 2020. In consideration for the Facility, Excellon has issued 536,454 Excellon
Shares (the “Subscribed Shares”) to Sprott Lending, representing 3% of the principal amount of the Facility
based on a 10% discount to the 5 -day volume weighted average trading price of Excellon Shares as of
March 12, 2020. The Subscribed Shares will be subject to a hold period of four months and one day from
the date of issuance under applicable securities laws.
Further Information
For further information regarding Excellon please contact:
Brendan Cahill, President & CEO or
Anna Ladd-Kruger, CFO & VP Corporate Development
(416) 364-1130
www.excellonresources.com
For further information regarding Otis Gold please contact:
Craig Lindsay, President & CEO or
Tony Perri, Manager, Investor Relations
Tel: (604) 683-2507
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www.otisgold.com
About Excellon
Excellon’s 100% -owned Platosa Mine has been Mexico ’s highest-grade silver mine since production
commenced in 2005. The Company is focused on optimizing Platosa ’s cost and production profile,
discovering further high -grade silver and carbonate replacement deposit mineralization on the 14,000 -
hectare Platosa P roject and epithermal silver mineralization on the 100% -owned 45,000 -hectare
Evolución Property, and capitalizing on current market conditions by acquiring undervalued projects. The
Company also holds an option on the 164 km 2 Silver City Project in Saxony, Germany, a high -grade
epithermal silver district with 750 years of mining history and no modern exploration.
Additional details on Excellon’s properties are available at www.excellonresources.com.
About Otis Gold
Otis Gold is a resource company focused on the acquisition, exploration, and development of precious
metal deposits in Idaho, USA. Otis is currently developing its flagship property, the Kilgore Project, located
in Clark County, Idaho and the Oakley Project, located in Cassia County, Idaho.
Additional details on Otis Gold’s properties are available at www.otisgold.com.
Forward-Looking Statements
This press release contains forward -looking statements within the meaning of Canadian securities laws . Such statements in this press release
include, without limitation, statements regarding the timing of the completion of the Transaction, synergies of the Transaction; the anticipated
benefits of the Transaction to shareholders of Excellon and Otis Gold; the third-party approvals required to complete the Transaction; the conditions
required to be satisfied to complete the Transaction; the ability of the com panies to complete the Transaction on terms announced; the future
results of operations of the Combined Company following the completion of the Transaction, the timing of the companies to hold their respective
shareholders’ meetings; the expected timing to finalize, file and mail the joint management information circular; the proposed listing on the NYSE
American; the intentions, plans and future actions of the companies participating in the transactions described herein; the board and management
of the Combined Company; timing to list the common shares of Excellon on the NYSE American, performance and achievements of the Combined
Company, including potential property acquisitions, the timing, content, cost and results of proposed work programs, the discovery and delineation
of mineral deposits/resources/reserves, geological interpretations, proposed production rates, potential mineral recovery pro cesses and rates,
business and financing plans, business and market trends and future operating revenues. Although the companies believe that such statements
are reasonable, it can give no assurance that such expectations will prove to be correct. Forward -looking statements are typically identified by
words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future
events. The companies caution investors that any forward-looking statements are not guarantees of future results or performance, and that actual
results may differ materially from those in forward looking statements as a result of various factors, including, but not lim ited to, the inability to
satisfy the conditions required to complete the Transaction; the companies not being able to obtain third-party approvals; the Arrangement being
terminated; variations in the nature, quality and quantity of any mineral deposits that may be located, significant downward variations i n the
market price of any minerals produced, the inability to obtain any n ecessary permits, consents or authorizations required for its activities, to
produce minerals from its properties successfully or profitably, to continue its projected growth, to raise the necessary capital or to be fully able to
implement its business str ategies. The companies do not undertake, and assumes no obligation, to update or revise any such forward -looking
statements or forward-looking information contained herein to reflect new events or circumstances, except as may be required by law.
The public disclosure filings of Excellon and Otis Gold may be accessed via www.sedar.com and readers are urged to review these materials,
including the technical reports filed with respect to the mineral properties of the Combined Company, and particularly the September 7, 2018 NI
43-101 technical report prepared by SRK Consulting (Canada) Inc. with respect to the Platosa Property.
This press release is not and is not to be construed in any way as, an offer to buy or sell securities in the United States. The distribution of the
Excellon Shares in connection with the transactions described herein will not be registered under the United States Securities Act of 1933 (the “U.S.
Securities Act”) and the Excellon Shares may not be offered or sold in the United Sta tes absent registration or an applicable exemption from the
registration requirements of the U.S. Securities Act and applicable state securities laws. This press release shall not constitute an offer to sell or the
solicitation of an offer to buy the Excellon Shares, nor shall there be any offer or sale of the Excellon Shares in any jurisdiction in which such offer,
solicitation or sale would be unlawful.
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 press release.