BEDFORD, NS,
Dec. 11, 2012 /CNW/ - NSGold
Corporation (TSXV: NSX) is pleased to announce that it has
secured a commitment for a loan facility of up to $500,000 from Van Hoof Industrial Holdings Ltd.
("VHIH"), a company controlled by Mr. Hans
Van Hoof, Chairman of the Corporation. The loan facility is
being made available without any fees, options or warrants.
As the loan is drawn upon, it will bear interest at the rate of 6%
per annum. As collateral for the loan facility, the
Corporation will pledge its shareholding in NSX Silver Inc.,
representing 1,875,804 shares.
Hans Van Hoof, Chairman
commented:
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"My view is that real money tends to be made at the bottom,
rather than at the top of the market. The current junior mining
environment however has seen many 'false bottoms'. It seems
to me to be very much like the reversal of the dot-com boom of the
late 1990's and early 2000's. At our annual meeting in June
2012, I was talking to one of our shareholders, a very theoretical
man, with an impressive knowledge of mining company history. I
mentioned that the junior mining market felt a bit like the 1998
Asian/Russian Crisis followed by the record low commodity prices of
2001-2003. He then commented that the liquidity crisis was the
worst experienced in 64 years. That was June 2012 and everyone
expected the investment environment to improve from there on and
yet here we are in December 2012. |
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Recently I read a very well researched article by John A.
Kaiser regarding the pending 'extinction' of a significant number
of TSX and TSX-V listed junior mining companies. That in turn
reminded me of a phrase from Milton Keynes, that has, or should
have, saved many good investment managers over the years: |
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'The market can stay irrational longer than you can stay
solvent.' |
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Now back to NSGold Corporation, although we expect our
current cash and receivables position will cover our overhead into
mid-2013, the current environment does create some incredible
opportunities. Rather than having to make those opportunities
contingent upon securing funding before getting an exclusive due
diligence period, this loan facility should position the
Corporation to be at the forefront for executing on the right
opportunities, as well as for strategically advancing its 100%
owned Mooseland Gold Project."
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The Corporation and VHIH will proceed with the
preparation of a standard loan agreement to formalize the foregoing
arrangement.
Due to the fact that VHIH, the lender, has
ownership of more than 10% of the outstanding common shares of the
Corporation, the loan facility may be considered a "related party
transaction" for the purposes of Multilateral Instrument 61-101
Protection of Minority Security Holders in Special
Transactions and the Corporation is relying on exemptions from
the formal valuation and minority approval requirements of
Multilateral Instrument 61-101.
About NSGold
NSGold Corporation is a mineral exploration
company actively exploring for gold in Nova Scotia, Canada. NSGold's principal
property is the wholly-owned Mooseland Gold Property. NSGold's
shares are listed on the TSX Venture Exchange under the symbol
NSX.
Forward-Looking Statements
This news release contains statements that
may constitute "forward-looking information" or "forward-looking
statements" within the meaning of applicable Canadian securities
legislation. Forward-looking information and
statements may include, among others, statements regarding the
future plans, costs, objectives or performance of NSGold
Corporation ("NSGold"), or the assumptions underlying any of the
foregoing. In this news release, words such as "may",
"would", "could", "will", "likely", "believe", "expect",
"anticipate", "intend", "plan", "estimate" and similar words and
the negative form thereof are used to identify forward-looking
statements. Forward-looking statements should not be read as
guarantees of future performance or results, and will not
necessarily be accurate indications of whether, or the times at or
by which, such future performance will be achieved. No
assurance can be given that any events anticipated by the
forward-looking information will transpire or occur, or if any of
them do so, what benefits that NSGold or its shareholders will
derive. Forward-looking statements and information are based
on information available at the time and/or management's good-faith
belief with respect to future events and are subject to known or
unknown risks, uncertainties, assumptions and other unpredictable
factors, many of which are beyond NSGold's control. These
risks, uncertainties and assumptions include, but are not limited
to, those described under "Risks and Uncertainties" in NSGold's
Management Discussion and Analysis for the Year ended December 31, 2011, which is available on
SEDAR at www.sedar.com, and could cause actual events or results to
differ materially from those projected in any forward-looking
statements. NSGold does not intend, nor does NSGold undertake
any obligation, to update or revise any forward-looking information
or statements contained in this news release to reflect subsequent
information, events or circumstances or otherwise, except if
required by applicable laws.
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.
SOURCE NSGOLD CORPORATION
