THIS NEWS
RELEASE IS NOT FOR DISTRIBUTION IN THE UNITED STATES OR TO
TSX Venture
SYMBOL: NSM
July 24, 2009
Northern Star Completes Financing for CDN$22,537,458
Vancouver, B.C., July 24, 2009 – Northern Star Mining Corp (NSM: TSX-V) is pleased to
announce that further to its news releases of July 7 and 14, 2009 it has today
completed the private placement financing for CDN$22,537,458 (the “Financing”) with the syndicate of
agents led by Casimir Capital L.P. and including Canaccord Capital Corporation and
Wellington West Capital Markets Inc. (collectively the “Agents’) consisting of 36,643,000 unit subscription receipts (the “Unit Subscription Receipts”) at a price
of CDN$0.50 per Unit Subscription Receipt for gross proceeds of CDN$18,321,500
and 7,528,497
flow-through subscription
receipts (the “Flow-Through Subscription
Receipts”) at a price of CDN$0.56 per Flow-Through Subscription Receipt for
gross proceeds of CDN$4,215,958. The Company has also received subscriptions
for an additional 1,350,000 Unit Subscription Receipts totaling CDN$675,000
which it anticipates closing early next week upon receipt of wire transfer
funds.
100% of
the gross proceeds of the Financing is being deposited in escrow with
Computershare Trust Company of Canada (“Computershare”),
as subscription receipt agent, pending completion of a satisfactory
restructuring of the US$42,000,000 debt financing of senior secured notes (the
“2008 Notes”) issued by the Company
pursuant to an indenture with Computershare on August 13, 2008 to provide for
(a) the extension of the maturity date of the 2008 Notes for one year to August
13, 2011, August 15, 2011 and September 8, 2011, as applicable (b) the consent
of the holders of the 2008 Notes (the “2008
Note Holders”) to a new net smelter convertible loan facility and
accompanying security (the “Royalty Facility”)
(see the Company’s news release of July 7, 2009) and (c) the cancellation of up
to 45,000,000, but not less than 35,000,000, share purchase warrants issued to
the 2008 Note Holders as part of the 2008 Note financing (collectively the “Release Conditions”). If the Release Conditions are not satisfied
on or before August 31, 2009, the full amount of the Financing, together with
any accrued interest thereon, will be returned to the purchasers thereof.
Upon
satisfaction of the Release Conditions, the Company will prepay up to CDN$15,000,000
of the 2008 Notes from, inter alia, the proceeds of sale of the Unit Subscription
Receipts. The balance of the proceeds from the sale of Unit Subscription
Receipts, together with the proceeds of the Royalty Financing (CDN $8,000,000),
will be used to fund further exploration of the Company’s mineral resource
properties, capital expenditures and for general working capital purposes.
Each Unit Subscription Receipt
will entitle the holder thereof to automatically receive, without payment of
additional consideration, one unit of the Company (a “Unit”) upon satisfaction of the Release Conditions. Each Unit will consist of one common share
and one-half (1/2) of one transferable common share purchase warrant. Each
whole warrant will entitle the holder to purchase one additional common share
at a price of CDN$0.70 for a period of 36 months from the date of issuance.
Each
Flow-Through Subscription Receipt will entitle the holder thereof to
automatically receive, without payment of additional consideration, one
“flow-through” common share of the Company upon satisfaction of the Release
Conditions.
The gross
proceeds from the sale of the Flow-Through Subscription Receipts will be used
to fund exploration on the Company's
The
Company will also pay the Agents a cash commission of 7% of the total proceeds
raised pursuant to the Financing and agents’ warrants (the “Agents’ Warrants”) of 7% of the total number
of Unit Subscription Receipts and Flow-Through Subscription Receipts sold upon
satisfaction of the Release Conditions. Each Agents’ Warrant will entitle the
holder thereof to purchase one common share of the Company at a price of
CDN$0.50 for a period of 36 months from the date of issuance
All
securities issued under the Financing pursuant to today’s closing are subject
to a hold period of four months and a day expiring November 25, 2009.
The TSX Venture Exchange has not reviewed and does not
accept responsibility for the adequacy or accuracy of this release.
ON BEHALF OF THE BOARD
“Jonathan Awde”
Jonathan Awde,
VP Corporate Finance
FOR FURTHER INFORMATION PLEASE CONTACT: Northern Star Mining Corporation TOLL FREE (800)
460-5031 or (819) 825-8088, (FAX) (819) 825-1199
Website:
www.nsmgold.com
This news release contains forward-looking statements,
which relate to future events or future performance and reflect management’s
current expectations and assumptions.
Such forward-looking statements reflect management’s current beliefs and
are based on assumptions made by and information currently available to the
Company. Investors
are cautioned that these forward looking statements are neither promises nor
guarantees, and are subject to risks and uncertainties that may cause future
results to differ materially from those expected. These
forward-looking statements are made as of the date hereof and, except as
required under applicable securities legislation, the Company does not assume
any obligation to update or revise them to reflect new events or circumstances.
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