Maudore Receives Notice from their Senior Secured Creditor Regarding Enforcement of their Security and the Progress toward a Consensual Restructuring
MONTREAL, Oct. 3, 2013 /CNW Telbec/ – Greg Struble, President and CEO of
Maudore Minerals Ltd. (MAO: TSX-Venture; MAOMF: US OTC; M6L: Frankfurt Exchange) reports that after close of markets on Wednesday
October 2nd, the Company received a letter from Cyrus Capital Partners
in its capacity as a manager to FBC Holdings S.A.R.L regarding defaults
in the Credit Agreement covering FBC’s $22 million secured term loan to
Maudore and the state of negotiations with two major unsecured
creditors at each of Maudore and its operating subsidiary Aurbec Mines
As previously reported on August 25th, Promec Mining filed a ‘notice of
bankruptcy proceeding’ against Aurbec. As also previously reported,
the Company believes the notice of bankruptcy proceeding is an invalid
filing, and the Company has been vigorously working to have it
dismissed. At the same time, the Company has been negotiating a
consensual restructuring with our senior lender, our four major
unsecured creditors and other stakeholders to implement our ongoing
On September 30th, in order to preserve cash, we chose to defer the
payment of the Sept 30th interest due to FBC while negotiations
continue. After the close of business yesterday, Cyrus put Maudore on
notice that, while they are still prepared to proceed with a consensual
restructuring which would see the major unsecured creditors join them
in supporting Maudore’s business plan, they would move to enforce their
security if agreements to implement a standstill and consensual
restructuring are not signed by our four major unsecured creditors by
9:00 AM EDT on October 7th.
In their letter Cyrus stated that they “remain supportive of the board
and management of Maudore & Aurbec’s efforts to maximize cash flow and
reopen the Sleeping Giant mine”.
Cyrus’s commitment for financial support, which is contingent on our
four major creditors signing Standstill Agreements, includes new
funding to provide liquidity, deferral of future interest payments, and
other components which Maudore believes would provide the Company with
12 months to successfully execute its business plan and generate the
cash flows to repay our unsecured creditors.
As previously stated, the Company will do everything it can to ensure
that all stakeholders are treated fairly in accordance with their legal
entitlements, that no creditor receives preferential treatment, and
affected creditors receive full payment to the extent possible.
About Maudore Minerals Ltd.
Maudore is a Quebec based junior gold company with milling operations
and more than 22 exploration projects, of which five are at an advanced
stage toward development with reported current and historical
resources. The Company’s projects span some 120 kilometers, east-west,
of the underexplored Northern Volcanic Zone of the Abitibi Greenstone
Belt and cover a total area of 1570 km(2) with the Sleeping Giant Processing Facility within trucking distance of
key development projects.
Cautionary Statement Regarding Forward-Looking Statements
This release and other documents filed by the Company contain
forward-looking statements. All statements that are not clearly
historical in nature or that necessarily depend on future events are
forward-looking, and the words “intend”, “anticipate”, “believe”,
“expect”, “estimate”, “plan” and similar expressions are generally
intended to identify forward-looking statements. These forward-looking
statements include, without limitation, performance and achievements of
the Company, business and financing plans, business trends and future
operating revenues. These statements are inherently uncertain and
actual achievements of the Company or other future events or conditions
may differ materially from those reflected in the forward-looking
statements due to a variety of risks, uncertainties and other factors,
including, without limitation, financial related risks, unstable gold
and metal prices, operational risks including those related to title,
significant uncertainty related to inferred mineral resources,
operational hazards, unexpected geological situations, unfavourable
mining conditions, changing regulations and governmental policies,
failure to obtain required permits and approvals from government
authorities, failure to obtain any required approvals of the TSXV or
from shareholders, failure to obtain any required financing, failure to
complete any of the transactions described herein, increased
competition from other companies many of which have greater financial
resources, dependence on key personnel and environmental risks and the
other risks described in the Company’s continuous disclosure documents.
The decision to start mining without these studies increases the
uncertainty of success and increases the risk of failure if mining
costs exceed revenue. Mining and unit costs from this exercise will
provide accurate detail for future reports and studies.
Neither TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
SOURCE Maudore Minerals Ltd.