F-10: New Found Gold Corp. Files US$300 Million Shelf Prospectus and Unveils Initial Queensway Gold Project Mineral Resource Estimate

New Found Gold Corp. has filed a Form F-10 registration statement to offer up to US$300 million in various securities, alongside an updated technical report for its Queensway Gold Project, detailing an initial Mineral Resource estimate and ongoing exploration plans.

Summary

• New Found Gold Corp. has filed a Form F-10 registration statement for a universal shelf prospectus, allowing for the offering of up to US$300,000,000 in common shares, warrants, subscription receipts, units, debt securities, and share purchase contracts over a 25-month period.
• The company is a mineral exploration entity primarily focused on gold in Newfoundland and Labrador, Canada, with its flagship asset being the 100% owned Queensway Project.
• An initial Mineral Resource estimate for the Queensway Project, effective March 15, 2025, was announced on March 24, 2025, and the Technical Report was filed on April 15, 2025.
• The Queensway Project's Mineral Resources include 18,038,000 tonnes at 2.40 g/t Au for 1,392,000 indicated ounces of gold, and 10,709,000 tonnes at 1.77 g/t Au for 608,000 inferred ounces of gold.
• The resource estimate assumes a long-term gold price of US$2,200 per ounce and a US$/C$ exchange rate of US$1.00 = C$1.43, with an assumed metallurgical recovery of 90%.
• Open pit resources are estimated at a 0.3 g/t Au cut-off grade, while underground resources are at 1.65 g/t Au with a minimum mining width of 1.8 meters.
• The company has completed a 650,000-meter drill program on the Queensway Project and has commissioned a preliminary economic assessment (PEA) scheduled for completion in late Q2 2025.
• New Found Gold Corp. recently sold non-convertible senior secured notes of Maritime Resources Corp. for gross proceeds of US$2,000,000 (approximately C$2,778,000).
• The 2025 work program on the Queensway Project has commenced, indicating continued active exploration.
• As of the prospectus date, there are 200,707,994 Common Shares issued and outstanding, and 210,519,494 Common Shares on a fully-diluted basis.
• The Common Shares are listed on the TSX Venture Exchange (NFG) and NYSE American LLC (NFGC), with closing prices on May 22, 2025, of C$1.80 and US$1.31, respectively.

Sentiment

Score: 7

Explanation: The filing of a shelf prospectus provides crucial financial flexibility for future operations, and the initial Mineral Resource estimate for the Queensway Project is a substantial positive development for an exploration company, indicating significant progress in defining a potential gold deposit. However, the company remains in the exploration stage with no defined reserves, a history of negative cash flow, and inherent risks associated with mineral exploration and capital raising, which temper the overall positive sentiment.

Positives

• The announcement of an initial Mineral Resource estimate for the Queensway Project, totaling 1.39 million indicated ounces and 0.61 million inferred ounces of gold, marks a significant milestone for an exploration-stage company, demonstrating progress in defining the project's potential.
• The company has an extensive land package of 175,600 hectares, encompassing over 110 km of strike on key fault zones (Appleton Fault Zone and Joe Batts Pond Fault Zone), offering substantial exploration upside.
• Extensive exploration work has been completed, including a 650,000-meter drill program, which has led to multiple gold discoveries and expansions within the Queensway Project.
• Metallurgical test work indicates high gravity gold recoveries and overall gold recoveries ranging from 89% to 97% to gravity and sulphide concentrates, suggesting the material is amenable to conventional processing.
• The commissioning of a preliminary economic assessment (PEA) for the Queensway Project, expected in late Q2 2025, signifies a clear progression towards potential project development and economic evaluation.
• The company maintains a robust quality assurance and quality control (QA/QC) protocol for sampling and analytical procedures, which meets industry standards and supports the reliability of the Mineral Resource estimate.
• A recent sale of non-convertible senior secured notes for US$2,000,000 (C$2,778,000) provides additional capital, enhancing financial flexibility.
• The commencement of the 2025 work program on the Queensway Project demonstrates ongoing commitment to exploration and development activities.

Negatives

• The company has no history of earnings and has experienced negative cash flow from operating activities since its inception, indicating a reliance on external financing.
• The Queensway Project currently has no known mineral reserves, only mineral resources, which do not have demonstrated economic viability, highlighting the early stage of the project.
• As an exploration-stage company, there is no assurance that a commercially viable deposit will be found on any of its properties, posing a fundamental business risk.
• Substantial additional capital will be required for future exploration and development, and there is no guarantee that such financing will be available when needed or on favorable terms, potentially leading to significant dilution for existing shareholders.
• The company's financial statements are prepared assuming it will continue as a going concern, but its ability to do so is dependent on generating profitable operations and raising adequate financing, which introduces material uncertainties.
• Metallurgical test work revealed that lower grade samples (<4g/t Au) contained gold associated with arsenic, which was only partially amenable to cyanide leaching or recoverable by flotation, indicating some refractory gold that may require more complex processing.

Risks

• The company is an exploration stage company and cannot assure that a commercially viable deposit or reserve exists on any of its properties.
• Mineral Resource estimates are largely estimates, and there is no assurance that anticipated tonnages and grades will be achieved or that the particular level of recovery will be realized; future production could differ dramatically.
• There are currently no mineral reserves (within the meaning of NI 43-101) on any of the company's properties, and there is no assurance that any will be identified.
• The company relies on historical data compiled by previous parties, which if inaccurate or incomplete, could adversely affect exploration plans.
• Mineral exploration and development is a speculative business with significant risks, including unprofitable efforts and marketability of minerals being affected by factors beyond the company's control.
• The mineral exploration industry is intensely competitive, and the company may not be able to compete successfully against larger, more established mining companies.
• Additional financing will be required for exploration and development, and such capital may not be available when needed or on favorable terms, potentially leading to substantial dilution.
• The company may not be able to successfully identify, negotiate, finance, or receive regulatory approval for future acquisitions.
• Exploration and development activities are dependent upon the grant and maintenance of appropriate licenses, concessions, leases, permits, and regulatory consents, which may be withdrawn or made subject to limitations.
• The company has a limited operating history and its mineral properties are in the exploration stage, requiring significant additional expenditures before any cash flow may be generated.
• There is no guarantee that title to the company's properties will not be challenged or impugned, or that title may be affected by prior unregistered agreements or native land claims.
• The company faces various risks associated with mining exploration that are uninsurable or may be subject to insurance that is not commercially feasible.
• The volatility of global capital markets makes raising capital more difficult, impacting the company's ability to obtain financing on favorable terms.
• The imposition of tariffs or other trade restrictions could increase costs and disrupt global trade, affecting the company's supply chain and foreign exchange rates.
• The company's business, financial condition, and results of operations may be negatively affected by economic and other consequences from geopolitical conflicts (e.g., Russia-Ukraine, Israel-Hamas war) and associated sanctions.
• Inflationary cost pressures may escalate the company's operating costs and impact future development decisions.
• Compliance with environmental regulations can be costly, and social and environmental activism can negatively impact exploration, development, and mining activities.
• The success of the company is largely dependent on the performance of its directors and officers, and the loss of key personnel could have a material adverse effect.
• Certain mineral properties may be subject to First Nations land claims, which could adversely affect the company's activities and ability to develop properties.
• The company and/or its directors and officers may be subject to various civil or other legal proceedings, which can be time-consuming, divert management attention, and incur significant expenses.
• Potential conflicts of interest may arise as most directors and officers also serve other natural resource or public companies, and there is no assurance such conflicts will be resolved in the company's favor.
• The company's future profitability will depend upon the volatile world market prices of gold and other metals, which are affected by numerous factors beyond its control.
• The company has no history of earnings and has negative cash flow from operating activities, requiring significant capital investment to achieve commercial production.
• The company's financial statements have been prepared assuming it will continue as a going concern, but its ability to do so depends on generating profitable operations and raising adequate financing.
• The company is subject to changing rules and regulations promulgated by U.S. and Canadian governmental and self-regulated organizations, increasing compliance costs and demands on resources.
• Risks associated with future acquisitions, including integration difficulties, potentially dilutive issuances of equity securities, and incurrence of debt.
• The company's projects may be adversely affected by force majeure events such as labor unrest, civil disorder, war, natural disasters, or pandemics.
• Failure to adequately meet infrastructure requirements (roads, power, water) or changes in their cost could prevent or delay exploration or development.
• The company is subject to various risks associated with climate change, including increased operating costs from legislation and geotechnical challenges.
• The company's operations depend on information technology (IT) systems, which are subject to network disruptions, security breaches, and cyber-attacks.
• An investment in the company's securities carries a high degree of risk and should be considered speculative.
• Sales of a substantial number of Common Shares by existing shareholders could reduce the market price of the Common Shares.
• The market price of the Common Shares may not accurately represent the company's performance or intrinsic fair value due to external variables.
• The trading market for the Common Shares could be influenced by research and reports from industry and/or securities analysts, over whom the company has no control.
• Securities of mineral exploration and development companies have experienced substantial price volatility in the past, often based on factors unrelated to financial performance.
• Future sales or issuances of equity securities will likely be dilutive to existing shareholders' voting power and may reduce future potential earnings per Common Share.
• The company has not paid any dividends on its Common Shares and does not intend to do so in the foreseeable future.
• The company may fail to meet the continued listing requirements for its Common Shares on the TSXV and/or the NYSE American, potentially leading to delisting.
• The company may fail to maintain adequate internal control over financial reporting pursuant to the requirements of the Sarbanes-Oxley Act (SOX).
• The company may be classified as a passive foreign investment company (PFIC) for U.S. federal income tax purposes, which may have adverse consequences for U.S. investors.
• As a foreign private issuer, the company is not required to comply with all U.S. federal securities laws' periodic disclosure and current reporting requirements, which may result in less timely information for U.S. investors.
• The company has discretion over the actual application of the net proceeds from an offering, which may not align with investors' expectations.
• There is no public market for the debt securities, warrants, subscription receipts, securities purchase contracts, or units contemplated by this prospectus, and liquidity may be limited.
• Prevailing interest rates and fluctuations in foreign currency markets will affect the market price or value of any debt securities.
• It may be difficult or impossible for U.S. investors to enforce civil liabilities against the company or its Canadian/non-U.S. directors and officers.

Future Outlook

New Found Gold Corp. plans to advance the Queensway Project by undertaking a preliminary economic assessment (PEA) scheduled for completion in late Q2 2025. Future exploration will focus on infill drilling within pit shells to convert unclassified material, near-surface expansion along the Appleton Fault Zone (AFZ) and Joe Batts Pond Fault Zone (JBPFZ), extensions of open underground reporting panels at depth and along strike, and deep drilling in the AFZ Core to follow up on high-grade intercepts. Following a positive PEA, the company will consider targeted closely spaced RC or diamond drilling in early life-of-mine (LOM) production areas and bulk sampling to confirm grade continuity and validate the resource model. Further metallurgical test work is planned to evaluate the production of a saleable sulphide concentrate and assess sulphide oxidation techniques, with consideration for developing a geometallurgical model.

Management Comments

• Management of the Company is actively targeting sources of additional financing through alliances with financial, exploration and mining entities or other business and financial transactions.

Industry Context

New Found Gold Corp. operates within the highly competitive global mineral exploration industry, specifically targeting gold deposits in Newfoundland and Labrador, Canada. The Queensway Project is characterized as an orogenic gold deposit, a globally significant deposit type known for hosting rich gold systems. The company's activities are subject to both Canadian and U.S. securities regulations, operating under a multijurisdictional disclosure system (MJDS). The filing of a shelf prospectus is a common strategy for exploration companies to secure future financing flexibility in capital-intensive industries.

Comparison to Industry Standards

• The document does not provide specific comparisons to other companies' projects or results within the industry.
• It notes that disclosure regarding mineral properties, including resource estimates, is prepared in accordance with Canadian National Instrument 43-101 (NI 43-101), which differs significantly from U.S. SEC disclosure requirements, making direct comparability to U.S. companies' public information challenging without further analysis.

Management Changes

Corporate Governance

Legal Proceedings

• The company and/or its directors and officers may be subject to a variety of civil or other legal proceedings, including commercial, employment, and other litigation and claims, as well as governmental and other regulatory investigations and proceedings.
• Such matters can be time-consuming, divert management's attention and resources, and cause the company to incur significant expenses.
• The results of any such actions are inherently unpredictable and may have a material adverse effect on the company's business, operating results, or financial condition.

Related Party Transactions

• The company has an ongoing VOA Option Agreement with Aidan ONeil, Suraj Amarnani, and Josh Vann (and VOA Exploration Inc.), who are the current property owners of certain mineral licences representing 7.8% of the Queensway Project claims. Under this agreement, New Found Gold Corp. is making cash payments and issuing common shares to acquire a 100% interest in these properties.

Stakeholder Impact

• **Shareholders**: Potential for dilution from future equity financings under the shelf prospectus; potential for increased share price volatility; potential for long-term value creation if the Queensway Project successfully advances to production; risk of loss of entire investment due to the speculative nature of exploration.
• **Employees**: Continued employment and potential growth opportunities with ongoing exploration and development activities at the Queensway Project.
• **Local Communities (Gander, Appleton, Glenwood)**: Continued demand for local labor, amenities, and services due to ongoing exploration programs, with potential for long-term economic benefits if the project reaches the development and production stages.
• **Suppliers**: Continued demand for exploration services, equipment, and operating supplies in Newfoundland and Labrador.
• **Creditors**: Potential for new creditor relationships if debt securities are issued under the shelf prospectus; existing creditors face risks related to the company's negative cash flow and reliance on future financing.
• **First Nations**: Potential impact from land claims, which may require negotiation and approval to facilitate exploration and development work on the company's mineral properties.

Next Steps

• Undertake a preliminary economic assessment (PEA) for the Queensway Project, scheduled for completion in late second quarter of 2025.
• Continue infill drilling within the pit shells to convert unclassified material to higher confidence categories.
• Conduct near-surface expansion drilling along the Appleton Fault Zone (AFZ) and Joe Batts Pond Fault Zone (JBPFZ).
• Advance existing targets and identify new targets at Queensway South (QWS) and along the JBPFZ.
• Extend open underground reporting panels at depth and along strike.
• Perform deep drilling in the AFZ Core to follow up on widely spaced high-grade intercepts.
• Consider targeted closely spaced RC or diamond drilling in areas expected to have the greatest impact on early life-of-mine (LOM) production, following a positive PEA.
• Consider bulk sampling in early LOM areas to confirm grade continuity and validate the resource model, following a positive PEA.
• Acquire additional spatially representative wax-coated water immersion density measurements for various rock types.
• Consider developing a geometallurgical model, if warranted, to account for recovery variability and support process planning for future technical evaluations beyond the PEA stage.
• Continue to evaluate the geological and grade continuity of mineralized vein wireframe interpretations hosted within or extending into the modelled AFZ structure.
• Continue assaying samples with multielement ICP to support lithology and mineralized wireframe interpretation.
• Conduct test work to evaluate the production of a saleable sulphide concentrate containing gold, exploring both preand post-cyanide leaching flotation options.
• Conduct sulphide oxidation test work on Keats, Lotto, Golden Joint, Iceberg, and Keats West flotation concentrates to assess amenability to this technique.
• Coordinate future sample selection and test work with the development of a geological model and mine plans to ensure samples represent material that would be processed in a mill.

Key Dates

Recommendation

Keywords

Gold exploration, Queensway Project, Newfoundland, Mineral Resource, Shelf Prospectus, SEC F-10, New Found Gold Corp., NFG, NFGC, Precious Metals, Exploration drilling, Preliminary Economic Assessment, NI 43-101