Northquest Ltd.
TSX VENTURE : NQ

Northquest Ltd.

May 06, 2011 13:04 ET

Northquest Ltd. Announces Closing of Private Placement Financing

TORONTO, ONTARIO--(Marketwire - May 6, 2011) -

NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE U.S.

Northquest Ltd. (TSX VENTURE:NQ) ("Northquest") is pleased to announce that it has issued 435,000 units (the "Units") at a price of $0.80 per Unit and 2,257,423 flow-through units (the "FT Units") at a price of $1.05 per FT Unit for aggregate gross proceeds of $2,718,294 pursuant to its previously announced private placement (the "Offering"). Each Unit consists of one common share of Northquest and one-half of one common share purchase warrant. Each whole common share purchase warrant entitles the holder thereof to acquire one additional common share of Northquest until May 6, 2013 at an exercise price of $1.65 per share. Each FT Unit consists of one "flow through" common share of Northquest and one-half of one common share purchase warrant, each whole common share purchase warrant entitling the holder thereof to acquire one additional common share of Northquest (which shall not be a "flow through share") until May 6, 2013 at an exercise price of $1.50 per share.

NCP Northland Capital Partners Inc. ("NCP") acted as agent for and on behalf of Northquest, with respect to the Offering, pursuant to which they received a cash commission and 175,886 broker warrants (the "Broker Warrants") each of which is exercisable to acquire one common share at a price of $1.00 until May 6, 2013.

The securities issued are subject to a hold period expiring September 7, 2011 in accordance with the rules and policies of the TSX Venture Exchange and applicable Canadian securities laws and such further restrictions as may apply under foreign securities laws. The gross proceeds from the sale of the FT Units will be used for exploration and development of Northquest's Nunavut properties. Northquest's expenditures will qualify as "Canadian exploration expenses" (CEE) under the Income Tax Act (Canada) and will be renounced to Investors for the 2011 taxation year. The net proceeds from the sale of Units will be used for development of Northquest's properties and for general working capital purposes. Northquest may close additional tranches of the Offering.

The Offering remains subject to the final approval of the TSX Venture Exchange.

Forward Looking Statements – Certain information set forth in this news release may contain forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond the control of Northquest, including, but not limited to the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations and dependence upon regulatory approvals. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements.

NEITHER THE 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.

Contact Information

  • Northquest Ltd.
    Jon North
    President and Chief Executive Officer
    (416) 786-6348