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Noront Closes US$15.0 Million Loan Facility with Resource Capital Fund V


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© Marketwire 2013
2013-02-26 22:01:27 -

TORONTO, ONTARIO -- (Marketwire) -- 02/26/13 -- Noront Resources Ltd. ("Noront" or the "Company") (TSX VENTURE:NOT) is pleased to announce that it has entered into a loan facility with Resource Capital Fund V L.P. ("RCF") in the aggregate principal amount of US$15.0 million (the "Facility"). The Facility is a one year bridge loan (the "Bridge Loan") which matures on February 25th, 2014 and automatically rolls into a convertible loan (the "Convertible Loan") with a maturity date of December 31, 2015, if the Facility is not repaid prior to the Bridge Loan maturity date. The proceeds from the Facility will be used to further the development of the Company's advanced stage Eagle's Nest nickel, copper, platinum, palladium project; for working capital and for corporate requirements.


The Facility will bear interest at 10% per annum during the Bridge Loan period and at 8% per annum during the Convertible Loan period. Interest will be paid quarterly, in arrears, in common shares of the Company based on the volume weighted average trading price of the Company's common shares during the 20 days prior to the date of each interest period determination, or at RCF's option, in cash. The Facility will be secured by a first ranking perfected lien over all assets associated with the Company's projects, initially excluding the Company's interest in the Windfall Lake gold project; all shares or equity interests in subsidiaries of the Company and all intercompany debt. An Establishment Fee of 2% of the principal amount of the Facility will be paid to RCF in common shares of the Company, to be issued on the entering into of the Facility, with such shares valued using the volume weighted average trading price for the twenty days prior to November 28th, 2012.



The Convertible Loan may be converted into common shares of the Company at the option of RCF at a price of $0.45 cents per share at any time subsequent to the Bridge Loan maturity date and prior to December 31, 2015 (the "Conversion Rights"). RCF has an existing equity ownership interest in Noront of approximately 18%. If the Bridge Loan rolls into the Convertible Loan then, on a partially diluted basis, RCF's equity ownership interest will exceed 20% of the total number of outstanding shares of the Company. Shareholder approval is therefore required to grant the Conversion Rights and is a condition to entering into the Facility (which includes the Conversion Rights) after closing. The Facility requires the Company to hold a special meeting of shareholders to approve the Convertible Loan before the end of April 2013. If the Company's shareholders do not approve the Convertible Loan, then the Facility will mature on the Bridge Loan maturity date and the interest rate will increase to 15% per annum for the period beginning on the date of the special meeting of shareholders and ending on the Bridge Loan maturity date.


About Noront: Noront Resources Ltd. is focused on development of the high-grade Eagle's Nest nickel, copper, platinum and palladium deposit and the high-grade Blackbird chromite deposit, both of which are located in the James Bay lowlands of Ontario in an emerging metals camp known as the Ring of Fire.


For further information please visit Noront's website at: www.norontresources.com : www.norontresources.com or search the Company's publically filed documents on SEDAR at: www.sedar.com : www.sedar.com .


FORWARD-LOOKING STATEMENTS


This release contains "forward-looking statements" within the meaning of applicable Canadian securities legislation, including predictions, projections and forecasts. Forward-looking statements include, but are not limited to, statements that address activities, events or developments that the Company expects or anticipates will or may occur in the future, including such things as future business strategy, competitive strengths, goals, expansion, growth of the Company's businesses, operations, plans and with respect to exploration results, the timing and success of exploration activities generally, permitting time lines, government regulation of exploration and mining operations, environmental risks, title disputes or claims, limitations on insurance coverage, timing and possible outcome of any pending litigation and timing and results of future resource estimates or future economic studies.


Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "planning", "planned", "expects" or "looking forward", "does not expect", "continues", "scheduled", "estimates", "forecasts", "intends", "potential", "anticipates", "does not anticipate", or "belief", or describes a "goal", or variation of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved.


Forward-looking statements are based on a number of material factors and assumptions, including, the result of drilling and exploration activities, that contracted parties provide goods and/or services on the agreed timeframes, that equipment necessary for exploration is available as scheduled and does not incur unforeseen break downs, that no labour shortages or delays are incurred, that plant and equipment function as specified, that no unusual geological or technical problems occur, and that laboratory and other related services are available and perform as contracted. Forward-looking statements involve known and unknown risks, future events, conditions, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, prediction, projection, forecast, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, the interpretation and actual results of current exploration activities; changes in project parameters as plans continue to be refined; future prices of gold; possible variations in grade or recovery rates; failure of equipment or processes to operate as anticipated; the failure of contracted parties to perform; labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing or in the completion of exploration, as well as those factors disclosed in the Company's publicly filed documents. Although Noront has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.


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.


Contacts:

Noront Resources Ltd.

Olya Yousefi

Manager, Corporate Communications

(416) 367-1444

www.norontresources.com

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