VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 04/02/13 -- NOVAGOLD RESOURCES INC. (TSX: NG)(NYSE MKT: NG) today notified holders ("Holders") of its outstanding 5.5% Convertible Notes due May 1, 2015 (the "Notes") that they have the option to require NOVAGOLD to purchase for cash all or a portion of their Notes held on May 1, 2013 (the "Put Option"). The Put Option can be exercised commencing today and expiring at 5:00 pm, Eastern Time, on May 1, 2013. NOVAGOLD will purchase of all of the Notes surrendered at a price equal to 100% of the principal amount. With approximately US$300 million in cash and cash equivalents at February 28, 2013, NOVAGOLD has a strong balance sheet and more than sufficient cash resources to repay the entire amount of US$95 million of the Notes outstanding as well as fund the advancement of its flagship Donlin Gold Project in Alaska through the permitting process.
As required by the rules of the Securities and Exchange Commission (the SEC), NOVAGOLD will file a Tender Offer Statement (the "Statement") with the SEC. The Statement will include a notice to Holders (the "Issuer Put Right Notice") specifying the terms and conditions of the Put Option and the procedures for its exercise. The Holders are strongly encouraged to read the Issuer Put Right Notice and other relevant documents filed with the SEC before making a decision relating to the exercise of the Put Option. Materials filed with the SEC will be available electronically without charge at the SEC's website, www.sec.gov.
Holders may withdraw any Notes previously surrendered for purchase at any time prior to 5:00 pm, Eastern Time, on May 1, 2013. Notes that are not surrendered pursuant to the Put Option will remain outstanding in accordance with the terms of the Notes and the indenture.
NOVAGOLD will pay accrued and unpaid interest on the Notes through April 30, 2013 to holders of record on April 15, 2013 regardless of whether the Put Option is exercised or not. As a result, there will be no accrued and unpaid interest on the Notes on May 1, 2013.
Neither NOVAGOLD nor its Board of Directors or staff is making any recommendation as to whether any Holder should or should not exercise the Put Option.
BNY Mellon (formerly known as The Bank of New York) is acting as paying agent for the Put Option. Copies of the Issuer Put Right Notice and additional information relating to the Put Option may be obtained from BNY Mellon by calling (212) 815-4869.
NOVAGOLD is a well-financed precious metals company engaged in the exploration and development of mineral properties in North America. Its flagship asset is the 50%-owned Donlin Gold project in Alaska, one of the safest jurisdictions in the world. With a total of approximately 34 million ounces(1) of gold in the Proven and Probable reserve categories (505 million tonnes at an average grade of approximately 2.1 grams per tonne), Donlin Gold is regarded to be one of the largest, and most prospective known gold deposits in the world. According to the updated Feasibility Study (as defined below), once in production, Donlin Gold should average approximately 1.5 million ounces of gold per year for the first five years, followed by decades of more than one million ounces of gold per year on a 100% basis. The Donlin Gold project has substantial exploration potential beyond the designed footprint which currently covers only three kilometers of an approximately eight-kilometer strike length of the property. Permitting is underway for the Donlin Gold project, a clearly defined process expected to take 3-4 years. NOVAGOLD also owns 50% of the Galore Creek copper-gold-silver project located in northern British Columbia. According to the 2011 Pre-Feasibility Study, Galore Creek is expected to be the largest copper mine in Canada, a tier-one jurisdiction, when it is put into production. NOVAGOLD is currently evaluating opportunities to sell all or a portion of its interest in Galore Creek and would apply the proceeds toward the development of Donlin Gold. NOVAGOLD has a strong track record of forging collaborative partnerships, both with local communities and with major mining companies.
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