New Found Gold Closes First Tranche of C$56 Million Bought Deal Financing for Gross Proceeds of C$42 Million

Rhea-AI Summary

New Found Gold Corp (NFGC) has closed the first tranche of its C$56M bought deal financing, raising C$42M through the issuance of 15,265,000 charity flow-through shares at C$2.29 per share and 4,370,000 common shares at C$1.63 per share. The second tranche, expected to close around June 12, 2025, will raise an additional C$14M through 6,135,000 charity flow-through shares. Notable investor Eric Sprott plans to maintain his 19% stake. The proceeds from flow-through shares will fund Canadian exploration expenses at the Queensway Gold Project before December 31, 2026, while common share proceeds will support project advancement and working capital. The offering was led by BMO Capital Markets and SCP Resource Finance LP, with underwriters receiving a 5.25% fee on general sales and 1% on President's List Sales.

Positive

• Successful closing of first tranche raising C$42M with additional C$14M expected in second tranche
• Strategic investor Eric Sprott maintaining his significant 19% shareholding position
• Funds allocated for exploration at 100% owned Queensway Gold Project
• Strong institutional support with syndicate of reputable underwriters

Negative

• Significant dilution through issuance of approximately 25.77M new shares
• Substantial underwriting fees totaling over C$2M for first tranche alone

Insights

Mining Investment Specialist

New Found Gold secures substantial C$42M in first financing tranche, strengthening exploration capability with minimal shareholder dilution.

New Found Gold has successfully closed the first tranche of its C$56 million bought deal financing, raising C$42 million in gross proceeds through a structured offering of charity flow-through shares at C$2.29 per share and common shares at C$1.63. This significant capital injection represents a strong vote of confidence from institutional investors for the company's 100% owned Queensway Gold Project.

The financing structure reveals several important strategic elements. The premium pricing of the flow-through shares at C$2.29 versus C$1.63 for common shares allows New Found Gold to minimize dilution while maximizing capital raised. The flow-through structure efficiently leverages Canadian tax incentives, effectively subsidizing exploration costs while preserving capital.

Notable is Eric Sprott's continued commitment to maintain his approximately 19% ownership position in the second tranche, signaling strong support from one of the mining industry's most respected investors. This backing typically suggests confidence in the project's potential and management's execution capabilities.

The participation of nine financial institutions in the underwriting syndicate, led by BMO Capital Markets and SCP Resource Finance, demonstrates broad institutional interest. The successful raise during challenging market conditions for junior miners further validates the market's positive assessment of Queensway's prospects.

With these proceeds earmarked for Canadian exploration expenses qualifying as flow-through mining expenditures, New Found Gold has secured substantial runway to advance its Queensway Project through 2026. This financing removes near-term capital concerns and positions the company to accelerate exploration activities without the distraction of imminent funding needs.

VANCOUVER, BC, June 3, 2025 /PRNewswire/ - New Found Gold Corp. (TSXV: NFG) (NYSE-A: NFGC) ("New Found Gold" or the "Company") is pleased to announce that it has closed the first tranche of its previously announced "bought deal" public offering of (i) 21,400,000 charity flow-through common shares of the Company (the "Charity Flow-Through Common Shares") that will qualify as "flow-through shares" (within the meaning of subsection 66(15) of the Income Tax Act (Canada)) at a price of C$2.29 per Charity Flow-Through Common Share (the "Charity Flow-Through Common Share Offering Price"), and (ii) 4,370,000 common shares (the "Common Shares") at a price of C$1.63 per Common Share, for aggregate gross proceeds of C$56,129,100 (the "Offering").

The first tranche of the Offering consists of 15,265,000 Charity Flow-Through Common Shares and 4,370,000 Common Shares for aggregate gross proceeds of C$42,079,950.  

The first tranche of the Offering was completed pursuant to an underwriting agreement dated May 29, 2025 (the "Underwriting Agreement"), entered into among the Company and a syndicate of underwriters led by BMO Capital Markets and SCP Resource Finance LP and including Paradigm Capital Inc., Canaccord Genuity Corp., Haywood Securities Inc., Stifel Nicolaus Canada Inc., Roth Canada, Inc., A.G.P. Canada Investments ULC and ATB Securities Inc. (collectively, the "Underwriters").

Pursuant to the Underwriting Agreement, the second tranche of the Offering will consist of the further issuance by the Company of 6,135,000 Charity Flow-Through Common Shares at the Charity Flow-Through Common Share Offering Price per Charity Flow-Through Common Share for further gross proceeds of C$14,049,150. The second tranche of the Offering is expected to close on or about June 12, 2025. Completion of the Offering remains subject to the Company receiving all necessary regulatory approvals, including final approval of the TSX Venture Exchange (the "TSXV") to list the Charity Flow-Through Common Shares and the Common Shares.

Mr. Eric Sprott intends to participate in the second tranche of the Offering to maintain his approximate 19% shareholdings.

The Company granted the Underwriters an over-allotment option entitling the Underwriters to purchase up to an additional number of Charity Flow-Through Common Shares that in aggregate would be equal to 15% of the total number of Charity Flow-Through Common Shares to be issued under the Offering for the purpose of covering the Underwriters' over-allocation position, if any, exercisable, in whole or in part, at any time, and from time to time for up to 30 days after the closing of the first tranche of the Offering.

In connection with the closing of the first tranche of the Offering, the Company paid to the Underwriters, a cash fee in the aggregate amount of C$2,075,959, representing (i) 5.25% of the gross proceeds of the first tranche of the Offering, other than the gross proceeds raised from certain sales pursuant to a president's list (the "President's List Sales"); and (ii) 1.0% of the gross proceeds raised from President's List Sales. BMO Capital Markets, SCP Resource Finance LP, Paradigm Capital Inc., Canaccord Genuity Corp., Haywood Securities Inc., Stifel Nicolaus Canada Inc., Roth Canada, Inc., A.G.P. Canada Investments ULC and ATB Securities Inc. received C$799,244, C$695,446, C$207,596, C$114,178, C$62,279, C$62,279, C$51,899, C$41,519 and C$41,519, respectively. Pursuant to the Underwriting Agreement, the Underwriters will receive a further cash fee equal to 5.25% of the gross proceeds of the second tranche of the Offering other than the gross proceeds raised from President's List Sales and 1.0% of the gross proceeds raised from President's List Sales.

The gross proceeds from the offering of the Charity Flow-Through Common Shares will be used by the Company to incur eligible "Canadian exploration expenses" that qualify as "flow-through mining expenditures" (as such terms are defined in the Income Tax Act (Canada)) (the "Qualifying Expenditures") related to the Company's 100% owned Queensway Gold Project ("Queensway" or the "Project"), on or before December 31, 2026. All Qualifying Expenditures will be renounced in favour of the subscribers for the Charity Flow-Through Common Shares effective on or before December 31, 2025.

The net proceeds from the offering of the Common Shares will be used by the Company to advance the Project and for general corporate and working capital purposes.

The Charity Flow-Through Common Shares and the Common Shares were offered by way of a prospectus supplement in each of the Provinces and Territories of Canada (other than the Province of Quebec and Nunavut) and were also offered by way of a U.S. prospectus supplement forming part of the Company's registration statement on Form F-10 in the United States. Copies of the prospectus supplement and documents incorporated by reference therein are available electronically on the Canadian Securities Administrators' System for Electronic Data Analysis and Retrieval+ ("SEDAR+") (www.sedarplus.ca) and the SEC's Electronic Data Gathering and Retrieval System ("EDGAR") (www.sec.gov) under New Found Gold's issuer profile.

Certain directors and officers of the Company participated in the first tranche of the Offering and, accordingly, their participation in the Offering constitutes "a related party transaction" within the meaning of Multilateral Instrument 61-101 – Protection of Minority Shareholder Approval ("MI 61-101"). The Company has relied on the exemptions from valuation and minority shareholder approval requirements of MI 61-101 contained in sections 5.5(a) and 5.7(1)(a) of MI 61-101 in respect of such related party participation.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

About New Found Gold

New Found Gold holds a 100% interest in Queensway, located in Newfoundland and Labrador, a Tier 1 jurisdiction with excellent infrastructure and a skilled local workforce.

The Company has completed an initial mineral resource estimate at Queensway (see New Found Gold news release dated March 24, 2025). A fully funded preliminary economic assessment is underway, with completion scheduled for late Q2/25.

Recent drilling continues to yield new discoveries along strike and down dip of known gold zones, pointing to the district-scale potential of the 175,600 hectare project that covers a 110 km strike extent along two prospective fault zones.

New Found Gold has a new management team in place, a solid shareholder base, which includes a 19% holding by Eric Sprott, and is focused on growth and value creation at Queensway.

Please see the Company's SEDAR+ profile at www.sedarplus.ca and the Company's EDGAR profile at www.sec.gov.

Keith Boyle
Chief Executive Officer
New Found Gold Corp.

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

Forward-Looking Information

This press release contains certain "forward-looking statements" within the meaning of Canadian and U.S. securities legislation (including the Private Securities Litigation Reform Act of 1995), including statements relating to the use of proceeds of the Offering, the tax treatment of the Charity Flow-Through Common Shares, the expected closing date and completion of the second tranche of the Offering, the receipt of all necessary regulatory approvals in connection with the Offering and, statements related to Queensway and the Company's planned and future exploration at Queensway. Although the Company believes that such statements are reasonable, it can give no assurance that such expectations will prove to be correct. Forward-looking statements are statements that are not historical facts; they are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "aims", "suggests", "potential", "goal", "objective", "prospective", "preliminary," "possibly", and similar expressions, or that events or conditions "will", "would", "may", "can", "could" or "should" occur, or are those statements, which, by their nature, refer to future events. The Company cautions that forward-looking statements are based on the beliefs, estimates and opinions of the Company's management on the date the statements are made, and they involve a number of risks and uncertainties. Consequently, there can be no assurances that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Except to the extent required by applicable securities laws and the policies of the TSXV or the NYSE American LLC, the Company undertakes no obligation to update these forward-looking statements if management's beliefs, estimates or opinions, or other factors, should change. Factors that could cause future results to differ materially from those anticipated in these forward-looking statements include risks related to: the tax treatment of the Charity Flow-Through Common Shares, the possibility that the Company may not be able to secure permitting and other governmental clearances necessary to carry out the Company's exploration plans, the risk that the Company will not be able to raise sufficient funds to carry out its business plans, and the risk of political uncertainties and regulatory or legal changes that might interfere with the Company's business and prospects. The reader is urged to refer to the Company's Annual Information Form, Management's Discussion and Analysis and other reports and documents filed by the Company with applicable securities regulatory authorities from time to time, publicly available through the SEDAR+ at www.sedarplus.ca or through the EDGAR at www.sec.gov for a more complete discussion of such risk factors and their potential effects.

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SOURCE New Found Gold Corp.

FAQ

How much did New Found Gold (NFGC) raise in their recent financing?

New Found Gold raised C$42M in the first tranche and expects to raise an additional C$14M in the second tranche, totaling C$56M through a bought deal financing.

What is the price per share for NFGC's 2025 financing?

The financing includes charity flow-through shares at C$2.29 per share and common shares at C$1.63 per share.

How will New Found Gold use the proceeds from their 2025 financing?

Flow-through share proceeds will fund Canadian exploration expenses at the Queensway Gold Project, while common share proceeds will support project advancement and working capital.

Is Eric Sprott participating in New Found Gold's 2025 financing?

Yes, Eric Sprott intends to participate in the second tranche to maintain his approximate 19% shareholding position.

When will the second tranche of NFGC's financing close?

The second tranche is expected to close on or about June 12, 2025.