Northern Star Mining Corporation
TSX VENTURE : NSM

Northern Star Mining Corporation

September 11, 2008 18:21 ET

Northern Star Closes Balance of Brokered Debt Financing

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Sept. 11, 2008) -

THIS PRESS RELEASE IS NOT FOR DISTRIBUTION IN THE UNITED STATES OR TO U.S. NEWS AGENCIES

Northern Star Mining Corp. ("Northern Star" or the "Company") (TSX VENTURE:NSM): Further to the Company's news release of August 14, 2008, Northern Star announces that it has subsequently completed the sale of an additional US$8,000,000 of units ("Units") pursuant to its brokered private placement financing through Casimir Capital L.P. of New York ("Casimir") for a total offering of US$42,000,000 (the "Offering").

Each Unit consists of a transferable senior secured note (a "Note") in the principal amount of US$1,000 maturing in two (2) years, and 750 transferable share purchase warrants (each a "Warrant"). Each whole Warrant entitles the holder thereof to purchase one common share at an exercise price of CDN$1.20 per share for a period of five years from the date of issuance. The Notes bear interest at 14% per annum (of which the first six months has been pre-paid) and mature two years from date of issuance at 125% of the principal amount thereof. The Notes are also secured by a hypothec over all of the assets of the Company which is senior to all other security interests granted by the Company. The purchasers of Units also received a due diligence fee in an amount equal to 5% of their total subscription amount.

The Offering was made to US accredited investors pursuant to Regulation D of the US Securities Act of 1933, of which approximately US$15,080,000 was subscribed for by current noteholders (the "2007 Noteholders") who exchanged their existing notes ("2007 Notes") acquired pursuant to the Company's private placement debt financing in November, 2007 (the "2007 Financing") for Units of the Offering. See the August 14, 2008 news release for details of the effective interest rate being paid to 2007 Noteholders who exchanged their 2007 Notes for Units of the Offering.

The balance of the proceeds of the Offering will be used to carry out further surface and underground exploration and development work on Northern Star's Midway-Malartic Gold Project in Quebec, prepay approximately US$2,840,000 in principal amount of 2007 Notes not exchanged for Units under the Offering and for general working capital requirements.

Any 2007 Noteholders who exchanged their 2007 Notes for Units were entitled to retain their existing warrants to purchase shares of the Company at CDN$1.40 per share issued pursuant to the 2007 Financing, in addition to receiving new Warrants under the Offering.

Casimir received a cash commission of 5%, and broker warrants entitling them to purchase a total of 2,100,000 common shares of the Company on substantially the same terms and conditions as the Warrants.

ON BEHALF OF THE BOARD

Michel David, President

This press release, required by applicable Canadian laws, is not for distribution to U.S. news services or for dissemination in the United States, and does not constitute an offer of the securities described herein. These securities have not been registered under the United States Securities Act of 1933, as amended, or any state securities laws, and may not be offered or sold in the United States or to U.S. persons unless registered or exempt therefrom.

The TSX Venture Exchange has not reviewed the present information and is not responsible for the contents of this news release, which may contain forward looking statements.

Contact Information

  • Northern Star Mining Corporation
    Jonathan Awde
    Vice President of Corporate Finance
    Toll Free: 1-800-460-5031 or (819) 825-8088
    (819) 825-1199 (FAX)
    Website: www.nsmgold.com