NQ Exploration closes $0.45 mln private placement, settles certain debt

Quebec-focused mining company NQ Exploration (CVE:NQE) said Thursday it has closed a $0.45 million brokered private placement financing.

The placement, by Industrial Alliance Securities, consisted of a total of 402 flow-through units at a price of $1,120 per unit.

Each unit consists of 10,500 flow-through shares at a price of $0.085 per share, 3,500 common shares at a price of $0.065 per share and 3,500 warrants.

Each warrant entitles the holder to purchase one additional common share of NQ at a price of $0.12 each for a period of one year from closing.

NQ paid Industrial Alliance a cash commission of nine percent of the gross proceeds and issued a total of 281,400 non-transferable broker warrants, in connection with the placement.

The new funds, combined with existing working capital, will be used by NQ to conduct exploration programs in 2012 and for general working capital, it said.

Separately, the company also announced today that it settled its debt with Société de développement de la Baie-James (SDBJ), subject to TSX Venture Exchange approval.

The company issued a $200,000 convertible debenture to SDBJ on April 30, 2009. The debenture matured on April 30, 2011, bore interest at a rate of 15 percent per year and was convertible into common shares at any time, at SDBJ's discretion, at a price of $0.18 per share for the first 12 months, and $0.20 per share for the ensuing 12 months.

Interest will be settled through the issuance of common shares, while the parties have agreed to settle the capital amount of $200,000 through the issuance of a convertible debenture maturing on June 29, 2013.

In late November, NQ reported final results from its summer drilling program at the Carheil project in Quebec, intersecting high grade silver in the western extension of the Ag1 zone.

Hole CA2011-29 intersected the Ag1 zone at a vertical depth of around 100 metres, the company said, where a 14.0 metre wide zone grading 131 grams per tonne (g/t) of silver equivalent was returned.

This zone contained an enriched zone, grading a whopping 584 g/t silver equivalent over 1.5 metres.

NQ is a mining exploration company with a portfolio of 11 mining properties in the James Bay and Abitibi regions of Quebec.