Canada's NovaGold to price $100 million seven-year convertibles to yield 4.25%-4.75%, up 35%-40%

By Rebecca Melvin

New York, March 19 - Canada's NovaGold Resources Inc. planned to price $100 million of seven-year convertibles after the close Wednesday, according to a market source.

The senior unsecured notes were talked to price with a coupon of 4.25% to 4.75% and an initial conversion premium of 35% to 40%.

There is an over-allotment option for up to an additional $15 million of notes.

J.P. Morgan Securities Inc. is bookrunner of the registered offering.

The non-callable notes are putable in year five. The notes also have dividend and takeover protection and net share settlement.

Proceeds from the offering will be used to repay about C$16 million currently drawn down under the company's C$30 million short-term credit facility, to fund general exploration and development on the company's projects and for general corporate purposes.

NovaGold is a precious metals exploration and development company based in Vancouver, B.C.

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