Roxgold Inc. completes acquisition of XDM Royalty Corp.; further strengthens cash position in preparation for 2014

TORONTO, Dec. 31, 2013 /CNW/ - Roxgold Inc. ("Roxgold" or "the Company") (TSXV: ROG) is pleased to announce the completion of the acquisition of XDM Royalty Corp. ("XDM") pursuant to the definitive agreement announced on December 11, 2013 (the "Transaction"). The Transaction was approved by XDM shareholders at XDM's annual general and special meeting held on December 30, 2013 with 90.1% of the shareholders present or represented by proxy voting in favour of the Transaction.

Pursuant to the Transaction, XDM shareholders received approximately 0.186 Roxgold common shares for every one common share of XDM held (the "Exchange Ratio") which reflected the original offer price of $0.55 per Roxgold share. The final Exchange Ratio was determined based upon XDM's aggregate net cash on hand at closing which totalled approximately $8.3 million, following the sale of its royalty interests and after deduction of applicable Transaction and severance costs.  Accordingly, Roxgold issued an aggregate of approximately 15,153,819 common shares and 108,849 compensation options pursuant the Transaction, with each such compensation option entitling the holder to acquire one additional Roxgold share at an exercise price of $4.45 until December 31, 2015. In addition, Roxgold has reserved for issuance (i) an additional 619,082 common shares issuable upon the exercise of existing stock options of XDM, each exercisable at prices ranging from $1.34 to $5.36 until March 31, 2014; (ii) an additional 1,105,631 common shares issuable upon the exercise of existing share purchase warrants of XDM, each exercisable at $9.38 until December 8, 2015; and (iii) an additional 156,654 common shares issuable upon the exercise of existing compensation options of XDM, each exercisable at $5.36 to acquire one unit until December 8 or 23, 2015, each unit consisting of one common share and one-half of one share purchase warrant, with each whole warrant entitling the holder to acquire one additional common share at $9.38 until December 8, 2015.

"The completion of this Transaction further strengthens Roxgold's robust cash position which will contribute to the continued development of Yaramoko in 2014," commented John Dorward, President and Chief Executive Officer.  "We are delighted to close this transformational year with the completion of this acquisition, and look forward to an even more exciting 2014."

About Roxgold

Roxgold is a gold exploration and development company with its key asset, the high grade, 100% owned Yaramoko exploration permit located in the mineral-rich Houndé greenstone region of Burkina Faso, West Africa. The Company announced a Preliminary Economic Assessment in September 2013 which demonstrated attractive potential economics and is currently completing a Feasibility Study which is expected to be completed in the second quarter of 2014.  Roxgold trades on the TSX Venture Exchange under the symbol ROG.

Forward Looking Statements

This news release may contain forward-looking statements. These statements are based on information currently available to the Company and the Company provides no assurance that actual results will meet management's expectations. Forward-looking statements in this news release include statements that describe the potential Acquisition, the Company's future plans for the exploration and development of the 55 Zone and timing of future announcements, and include words to the effect that the Company or management expects a stated condition or result to occur. Forward-looking statements may be identified by such terms as "anticipates", "believes", "could", "estimates", "expects", "may", "shall", "will", or "would". Forward-looking statements are based on assumptions and address future events and conditions, by their very nature they involve inherent risks and uncertainties. The assumptions upon which forward looking statements in this news release are made include the reasonable assumptions of management with respect to the potential Acquisition and the receipt of all applicable shareholder and regulatory approvals. Actual results relating to such future events and conditions could differ materially from those currently anticipated in such statements for many reasons such as: changes in management, changes in general economic conditions and conditions in the financial markets; changes in demand and prices for minerals; litigation, legislative, environmental and other judicial, regulatory, political and competitive developments and other matters discussed in this news release. The Company has not made a construction or production decision on the Yaramoko Gold Project at this time. Further, if and when the Company makes any production decision, it will disclose the basis of such decision in accordance with the requirements of National Instrument 43-101 Standards of Disclosure for Mineral Projects ("NI 43-101"). This list is not exhaustive of the factors that may affect any of the Company's forward-looking statements. These and other factors should be considered carefully and readers should not place undue reliance on the Company's forward-looking statements. The Company does not undertake to update any forward-looking statement that may be made from time to time by the Company or on its behalf, except in accordance with applicable securities laws.

Neither 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.

SOURCE: Roxgold Inc.

Annelise Burke, Manager, Investor Relations & Corporate Communications
Roxgold Inc.
[phone]
[email protected]