Quest Uranium Corporation

Quest Uranium Corporation

October 08, 2009 17:23 ET

Quest Announces New $7 Million Private Placement

- Quest to issue units at $2.30 per unit

- Proceeds to be used primarily on Quest's Rare Earth project, Strange Lake, Quebec

- Pope & Company and MGI Securities to act as co-lead agents

TORONTO, ONTARIO--(Marketwire - Oct. 8, 2009) - Quest Uranium Corporation (TSX VENTURE:QUC) announces that it has signed an engagement letter with Pope & Company Ltd. and MGI Securities Inc. to act as co-lead agents for a private placement by Quest of up to $7 million. Quest will issue up to 3,043,500 units at a price of $2.30 per unit. Each unit will be comprised of one common share and one-half of a common share purchase warrant. Each full warrant will entitle the holder to acquire one additional common share of Quest at a price of $4.25 for a period of 18 months following the closing of the private placement.

Quest will grant the co-lead agents an option to increase the size of the private placement by up to $3 million, exercisable on not less than one day's notice. If the agent's option is exercised in full, Quest will issue a total of 4,347,827 units for gross proceeds of $10 million. Desjardins Securities Inc. will also be in the syndicate of agents for the private placement.

It is expected that the units will be subscribed for by "accredited investors" in Canada and elsewhere.

In connection with the private placement, Quest will pay the agents a cash commission equal to 7% of the gross proceeds from the sale of the units. In addition, Quest will grant a compensation option to the agents, entitling them to purchase a number of units equal to 7% of the number of units sold in the private placement. The agents may exercise their option for 18 months from the closing date of the private placement at the issue price of $2.30 per unit.

The private placement is expected to close on or about October 28, 2009. The proceeds from the private placement will be used for further exploration and development of Quest's Strange Lake, Québec Rare Earth project and for general corporate purposes.

There are currently 37,155,863 common shares of Quest issued and outstanding. The securities to be issued in the private placement will be subject to a four-month "hold period" under applicable securities legislation. The private placement is subject to regulatory approval, including that of the TSX Venture Exchange.

About Quest Uranium
Quest Uranium Corporation is a Canadian-based, exploration company focused on the identification and discovery of new world-class Rare Earth deposit opportunities. The Company is publicly-listed on the TSX Venture Exchange as "QUC" and is led by a highly-respected management and technical team with a proven mine-finding track record. Quest is currently advancing several high-potential projects in Canada's premier exploration areas: the Strange Lake area of northeastern Québec, the Kenora area of northwestern Ontario and the Plaster Rock area of northwestern New Brunswick. Quest continues to pursue high-value project opportunities throughout North America.

Forward-Looking Statements
This press release may contain "forward-looking statements". Readers are cautioned that any such statements are not guarantees of future performance and that actual developments or results may vary materially from those in these "forward looking statements".

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.

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