Kerr and Bear Lake Mines
New news (bad) with consolidation at 15 to 1 ..... Richard KERR MINES AND BEAR LAKE GOLD ANNOUNCE AGREEMENT TO COMBINE THE COMPANIES January 24, 2014 – Toronto, Ontario and Longueuil, Quebec – Kerr Mines Inc. (“Kerr Mines”) (TSX:KER) and Bear Lake Gold Ltd. (“Bear Lake”) (TSXV:BLG) are pleased to announce that they have entered into a letter agreement to combine the two companies (the “Transaction”). Transaction Details Under the terms of the letter agreement, Kerr Mines proposes to issue 1.4 units (each, a “Unit”) of Kerr Mines for every one (1) common share of Bear Lake (the “Exchange Ratio”). Each Unit will consist of one Kerr Mines share and one-half of one Kerr Mines warrant. Each whole Kerr Mines warrant will entitle the holder thereof to purchase one Kerr Mines share at an exercise price of $0.16 per Kerr Mines Share for a period of two (2) years from the closing of the Transaction. Currently Kerr Mines has approximately 427 million shares issued and outstanding while Bear Lake has approximately 136 million shares issued and outstanding. As a result, approximately 190,934,163 Kerr Mines Units will be issued to former Bear Lake shareholders to acquire the 100% interest in Bear Lake. It is anticipated that the Transaction will be completed prior to the proposed acquisition of American Bonanza Mining Corp. by Kerr Mines, announced on January 23, 2014 (the “American Bonanza Transaction”). In addition, each holder of the stock options of Bear Lake outstanding as of the date of completion of the Transaction will receive such number of replacement stock options of Kerr Mines adjusted in accordance with the Exchange Ratio pursuant to the terms of the Transaction. “We are pleased with the acquisition of Bear Lake which adds an additional 13 km strike-length of the prolific Cadillac Larder Lake break to the Kerr Mines land package, an inferred resource estimate of nearly 1 MM oz grading over 5 g/t Au and a strategic partnership through an option and joint venture with Gold Fields on the Bear Lake property,” said Greg Gibson, President and CEO of Kerr Mines. As approved by the shareholders of Kerr Mines at the annual and special meeting of the shareholders of Kerr Mines held on December 19, 2013, the Kerr Mines Shares will, following completion of the Transaction and the American Bonanza Transaction, be consolidated on a 1 for 15 basis. Pursuant to the terms of the letter agreement, Bear Lake will be entitled to nominate one person to the board of directors of Kerr. Kerr Mines has also agreed to advance $300,000 to Bear Lake to satisfy certain amounts and payables outstanding of Bear Lake until completion of the Transaction. Kerr Mines and Bear Lake intends to complete the Transaction pursuant to a plan of arrangement under the Business Corporations Act (Ontario). Completion of the Transaction will be subject to certain customary conditions including, without limitation: (a) satisfactory due diligence; (b) receipt of all necessary consents, waivers, permits, exemptions, orders and approvals, including court approval of the plan of arrangement