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Stornoway (TSX:SWY) Announces Flow-Through Financing for Renard Resource

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RobertJames   Wednesday, 11/13/13 09:35:04 AM
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Stornoway (TSX:SWY) Announces Flow-Through Financing for Renard Resource Expansion Drill Program







LONGUEUIL, QUEBEC--(Marketwired - Nov. 13, 2013) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

Stornoway Diamond Corporation (TSX:SWY) is pleased to announce that it has entered into an agreement with Dundee Securities Ltd. as lead underwriter, together with a syndicate including Scotiabank and Desjardins Securities Inc. (collectively, the "Underwriters"), for a private placement financing on a bought deal basis of 5,265,000 flow-through common shares ("Flow-Through Shares") at a price of $0.95 per Flow-Through Share for gross proceeds of $5,001,750 (the "Offering"). In addition, Stornoway has granted the Underwriters the option to purchase up to an additional 789,750 Flow-Through Shares to cover over-allotments (the "Over-Allotment Option"). The Underwriters may exercise the Over-Allotment Option at the issue price up to 48 hours prior to closing.

The Flow-Through Shares issued pursuant to the Offering will be subject to a four-month hold period. In the event that the Over-Allotment Option is exercised in its entirety, the gross proceeds of the Offering will be $5,752,013. Stornoway has agreed that expenditures incurred with proceeds from the Offering will constitute Canadian exploration expense ("CEE") (as defined in the Income Tax Act) and will be renounced to the subscribers.

Matt Manson, Stornoway's President and CEO commented: "The Renard Diamond Project possesses extensive resource upside outside of the current Mineral Reserve, characterized as either Inferred Mineral Resource or 'Target for Further Exploration'. The financing announced today allows us to plan for a resource expansion and conversion program in 2014 targeted principally on Renard 2 and designed to aggressively test the depth extent of the Renard kimberlites. This program will run separate from, and complementary to, the project construction capital program scheduled for 2014 and 2015 following the completion of principal project financing."

Closing of the Offering is anticipated to occur on or before December 3, 2013 and is subject to receipt of applicable regulatory approvals, including approval of the Toronto Stock Exchange.

The Flow-Through Shares have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "1933 Act"), or under any state securities laws, and may not be offered or sold, directly or indirectly, or delivered within the United States or to, or for the account or benefit of, U.S. persons (as defined in Regulation S under the 1933 Act) absent registration or an applicable exemption from the registration requirements. This news release does not constitute an offer to sell or a solicitation to buy such securities in the United States.

About the Renard Diamond Project

The Renard Diamond Project is located approximately 250 km north of the Cree community of Mistissini and 350 km north of Chibougamau in the James Bay region of north-central Québec. In November 2011, Stornoway released the results of a Feasibility Study at Renard, followed by an Optimization Study in January 2013, which highlighted the potential of the project to become a significant producer of high value rough diamonds over a long mine life. Probable Mineral Reserves as defined under National Instrument ("NI") 43-101 stand at 17.9 million carats. Total Indicated Mineral Resources, inclusive of the Mineral Reserve, stand at 27.1 million carats, with a further 16.9 million carats classified as Inferred Mineral Resources, and 25.7 to 47.8 million carats classified as non-resource exploration upside. All kimberlites remain open at depth. Readers are referred to the technical report dated December 29th, 2011 in respect of the November 2011 Feasibility Study for the Renard Diamond Project, and the technical report dated February 28th, 2013 in respect of the January 2013 Optimization Study, for further details and assumptions relating to the project.

About Stornoway Diamond Corporation

Stornoway is a leading Canadian diamond exploration and development company listed on the Toronto Stock Exchange under the symbol SWY and headquartered in Montreal. Our flagship asset is the 100% owned Renard Diamond Project, on track to becoming Québec's first diamond mine. Stornoway is a growth oriented company with a world class asset, in one of the world's best mining jurisdictions, in one of the world's great mining businesses.

On behalf of the Board

STORNOWAY DIAMOND CORPORATION

Matt Manson, President and Chief Executive Officer


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