TORONTO, ONTARIO--(Marketwire - Nov. 30, 2012) -NORTHERN GOLD MINING INC. (TSX VENTURE:NGM) ("Northern Gold" or the "Company") is pleased to announce that it has entered into a definitive option agreement (the "Option Agreement") with various property interest holders including Tiger Gold Exploration Corporation (collectively, the "Optionors") wherein Northern Gold has been granted the exclusive right to earn up to a 100% interest in certain mining claims and leases located in Harker, Holloway, Elliott, Garrison, Thackeray, Marriott and Tannahill Townships, Ontario (the "Property").
Pursuant to the terms of the Option Agreement the Company can acquire an initial 80% interest in the Property (the "Initial Option"), in exchange for:
- Cash payment in the amount of $500,000 upon execution of the Option Agreement (the "Effective Date");
- Cash payments in the aggregate amount of $2,500,000 payable in installments of $500,000 on or before the first, second, third, fourth and fifth anniversaries of the Effective Date;
- An aggregate of 20,000,000 common shares ("Common Shares") of Northern Gold issuable in the amount of 4,000,000 Common Shares on each of the first, second, third, fourth and fifth anniversaries of the Effective Date; and
- a 3% net smelter return royalty (the "Royalty") on the Property in favour of the Optionors. Pursuant to the terms of a royalty agreement the Company shall have the right to purchase 1% of the Royalty from the Optionors for sum of $3,000,000.
Following the exercise of the Initial Option, the Company can acquire an additional 20% interest in the Property (the "Additional Option") in exchange for a cash payment of $5,000,000. The Additional Option is exercisable on or before the first anniversary of the exercise of the Initial Option.
The Property consists of 18 patented mining claims, 806 unpatented mining claims units and 2 leases comprised of an aggregate of 13 claim units and extends across approximately 14,240 hectares.
Mr. Greg Gibson, the President and CEO of the Company, stated: "The acquisition of the Harker-Halloway Gold Property significantly increases Northern Gold's land holdings in the area and will substantially enhance Northern Gold's production and exploration potential. The technical due diligence undertaken to date by our exploration team on the property's historical work reveals the high prospectivity for the discovery of additional gold deposits."
The securities issuable pursuant to the Agreement are subject to a four month hold period from the date of issuance. Completion of the transaction is subject to approval of the TSX Venture Exchange (the "TSXV").
Grant of Stock Options
Northern Gold also wishes to announce that it has granted an aggregate of 5,200,000 options to purchase Common Shares exercisable at a price of $0.35 per share for a period of five years, to certain directors, officers and employees of the Company. The options have been granted in accordance with the terms of the Company's stock option plan and in accordance with the policies of the TSXV.
About Northern Gold
Northern Gold Mining Inc. is a TSXV listed, publicly traded junior resource company based in Toronto, Ontario, dedicated to the discovery and development of high value mineral deposits in the proven mining camps of Kirkland Lake and Timmins in north eastern Ontario. Northern Gold is focused on outlining two gold deposits at an advanced stage of exploration on its 100% owned Garrison Gold Property. The Company has recently acquired the Buffonta Property just 4 km southwest. In addition to the Jonpol and Garrcon gold deposits, the Garrison Property hosts several other gold mineralized showings, including the less advanced 903 gold mineralized area. Northern Gold has historical mining infrastructure at both the Jonpol and Garrcon Deposits, is commencing exploration of the Buffonta Property, and continues to expand its land holdings in the region.
CAUTIONARY STATEMENT: This news release contains forward-looking information which is not comprised of historical facts. Forward-looking information involves risks, uncertainties and other factors that could cause actual events, results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking information. Forward looking information in this news release includes, but is not limited to, Northern Gold's objectives, goals or future plans, statements regarding exploration results and exploration plans. Factors that could cause actual results to differ materially from such forward-looking information include, but are not limited to, capital and operating costs varying significantly from estimates, the preliminary nature of metallurgical test results, delays in obtaining or failures to obtain required governmental, environmental or other project approvals, uncertainties relating to the availability and costs of financing needed in the future, changes in equity markets, inflation, fluctuations in commodity prices, delays in the development of projects and the other risks involved in the mineral exploration and development industry, and those risks set out in Northern Gold's public documents filed on SEDAR. Although Northern Gold believes that the assumptions and factors used in preparing the forward-looking information in this news release are reasonable, undue reliance should not be placed on such information, which only applies as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all. Northern Gold disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, other than as required by law.