TORONTO, ONTARIO--(Marketwired - May 26, 2016) - Northquest Ltd. (TSX VENTURE:NQ)(FRANKFURT:N3Q)
("Northquest" or "the Company") and Nord Gold N.V. (LSE:NORD) ("Nordgold") announce that they have entered into a support
agreement (the "Support Agreement") in respect of an increased offer by Nordgold to purchase all of the common shares of the
Company ("Common Shares") it does not already own (as amended, the "Offer").
On April 26, 2016, Nordgold commenced the Offer at a price of $0.253 per Common Share (the "Original Offer") which Original
Offer was to remain open to shareholders of the Company ("Shareholders") until 5:00 (Toronto time) on June 1, 2016. Pursuant to
the Support Agreement, Nordgold has agreed to:
- increase the price of the Offer to $0.26 per Common Share;
- extend the expiry time of the Offer to 5:00 p.m. (Toronto time) on June 15, 2016;
- waive the Minimum Tender Condition (as defined in the take-over bid circular of Nordgold relating to the Original Offer
(the "Nordgold Circular"));
- amend the condition set forth in Section 4(c) of the Nordgold Circular to provide as follows: "all Northquest Options and
Northquest convertible securities other than Northquest Warrants shall have been exercised, terminated or otherwise cancelled
or shall have been otherwise dealt with on terms satisfactory to Nordgold, acting reasonably"; and
- provide that any determination by Nordgold as to the satisfaction of a condition of the Offer be at its "reasonable
discretion", rather than at its "sole discretion".
Pursuant to the Support Agreement, Nordgold has also agreed to extend the time during which Common Shares may be deposited
under the Offer for a period of not less ten business days following the date on which it initially takes up any Common Shares
under the Offer.
Nordgold has also agreed that, subject to the satisfaction of certain conditions including satisfaction of the Minimum Tender
Condition, it shall implement a second step transaction to acquire the remaining outstanding Common Shares not tendered under the
Offer.
The Northquest board of directors (the "Board"), on the unanimous recommendation of the special committee of the Board (the
"Special Committee"), has (with Igor Klimanov, a representative of Nordgold on the Board having declared his interest and
refrained from voting) determined to recommend that Shareholders ACCEPT the Offer and
TENDER their Common Shares to the Offer. A directors' circular will be sent to
Shareholders and holders of options and warrants to acquire Common Shares in due course.
Concurrently with the entering into of the Support Agreement, each of the directors and officers of Northquest entered into
lock-up agreements with Nordgold and Northquest, pursuant to which each of the directors and officers agreed to tender to the
Offer all Common Shares beneficially owned by them, or over which they exercise control or direction, and any additional Common
Shares they may thereafter acquire.
Pursuant to the Support Agreement, the Company has agreed to accelerate the expiry date of all options to acquire Common
Shares such that all options shall have been exercised or shall have terminated by the expiry time of the Offer. Northquest has
also agreed to use its commercially reasonable efforts to cause the holders of outstanding in-the-money warrants to acquire
Common Shares to exercise such warrants in accordance with their terms.
Following the entering into of the Support Agreement, Jon North has resigned as a director of Northquest. Dr. North will
continue to act as President and Chief Executive Officer of the Company. The Board remains comprised of the other four directors
of the Company. Northquest has also agreed that, upon receipt of the requisite approval of the TSX Venture Exchange, it will
obtain the resignations of two additional current directors of the Company (other than Igor Klimanov) and shall appoint
Nordgold's independent director nominees as directors of the Company.
In addition, pursuant to the Support Agreement, Northquest has further agreed to obtain the resignations of Jon North as Chief
Executive Offer of Northquest and of each of the directors of the Company as Nordgold may request, effective as of 10 a.m.
(Toronto time) on the business day following June 15, 2016 (being the amended expiry date for the Offer), and to fill the
vacancies with Nordgold's director nominees.
A copy of the Support Agreement will be filed with the applicable securities regulatory authorities by Northquest as soon as
practicable.
A notice of change and variation for the Offer is expected to be mailed to shareholders of Northquest by no later than May 31,
2016. Shareholders are urged to carefully review this document in its entirety. Full details of the Offer and the related
documents including, once filed, the notice of change and variation, are, or will be available on Northquest's profile at
sedar.com.
Equity Financial Trust Company has been retained by Nordgold to act as depositary for the Common Shares in connection with the
Offer. Questions and requests for assistance may be directed to Equity Financial Trust Company at 1-866-393-4891 toll free in
North America, or at 416-342-1091 outside of North America, or by email at TMXEInvestorServices@tmx.com.
About Nordgold
Nordgold is an internationally diversified low-cost gold producer which is publicly traded on the London Stock Exchange under
the symbol "NORD". Nordgold has a proven track record of operational excellence and benefits from a significant international
development pipeline. In 2015, Nordgold produced 950 thousand ounces of gold with all-in sustaining costs of US$793 per ounce,
maintaining its position at the lower end of the global cost curve.
Nordgold operates 9 mines (5 in Russia, 2 in Burkina Faso and one each in Guinea and Kazakhstan). It has 2 active development
projects (Bouly in Burkina Faso and Gross in Russia), 4 advanced exploration projects and a diverse portfolio of early-stage
exploration projects and licences in Burkina Faso, Russia, French Guiana and Canada.
For further information on Nordgold please visit Nordgold's website: www.nordgold.com
Cautionary Note Regarding Forward-Looking Information
Certain information set forth in this news release may contain forward-looking statements that involve substantial known and
unknown risks and uncertainties, including but not limited to statements relating to the Offer and the terms thereof; any future
materials or information to be provided to security holders of the Company or filed on SEDAR; the Special Committee's and Board's
views on the Offer and recommendations to Shareholders; any changes to the composition of the Board or management of the Company;
any actions by Nordgold in furtherance of a second step transaction or extension of the expiry date of the Offer; and the terms
and conditions of any of the outstanding convertible securities of the Company. These statements relate to future events or
future performance and reflect the Company's expectations regarding the future growth, results of operations, business prospects
and opportunities. In some cases forward-looking information can be identified by terminology such as "may", "will", "should",
"expect", "intend", "plan", "anticipate", "believe", "estimate", "projects", "potential", "scheduled", "forecast", "budget" or
the negative of those terms or other comparable terminology. These forward-looking statements are subject to numerous risks and
uncertainties, certain of which are beyond the control of the Company, including, but not limited to, the Offer, impact of
general economic conditions, industry conditions, volatility of commodity prices, risks associated with the uncertainty of
exploration results and estimates, metallurgical test results and that the resource potential will be achieved on exploration
projects, currency fluctuations, dependence upon regulatory approvals, political and country risk, and the uncertainty of
obtaining additional financing and exploration risk. 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. The Company expressly disclaims any intention or obligation to update or
revise any forward-looking information, whether as a result of new information, events or otherwise, except in accordance with
applicable securities laws.
Disclaimer
This press release may not be published, distributed, transmitted or otherwise sent into the United States of
America (including its territories and possessions, every State in the United States and the District of Columbia). This press
release does not constitute an extension into the United States of the Offer, nor does this press release constitute nor form
part of an offer to sell securities or the solicitation of an offer to buy securities in the United States.
Information contained in this announcement is not an offer, or an invitation to make offers, sell, purchase,
exchange or transfer any securities in the Russian Federation or to or for the benefit of any Russian person, and does not
constitute an advertisement or offering to non-qualified investors of any securities in the Russian Federation. The Shares have
not been and will not be registered in the Russian Federation or admitted to public placement and/or public circulation in the
Russian Federation. The Shares not intended for "placement" or "circulation" in the Russian Federation unless and to the extent
permitted under Russian law.
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.