MONTREAL,
Jan. 10, 2014 /CNW Telbec/ - Maudore
Minerals Ltd. (MAO: TSX-Venture; MAOMF: US OTC;
M6L: Frankfurt Exchange) announces that it will no longer
proceed with the rights offering that it initiated on December 20, 2013 and that was scheduled to
expire at 5:00 p.m. (Montreal time) on January 10, 2014 (the "Rights
Offering").
On January 8,
2014, Maudore finalized its revised 2014 mining operations
plan and financial forecast (the "2014 Budget") which showed
materially lower free cash flow for 2014 than originally
anticipated primarily due to: (i) lower gold price assumptions,
(ii) increased working capital requirements related to the restart
of the Sleeping Giant mine and (iii) the shift of certain
production from 2014 to 2015. The majority of the reduced
cash flow for 2014 represents production timing issues and not a
lower life-of-mine production forecast. As a result of the
reprofiling of cash flows in the 2014 Budget, the ability of the
Company to meet its contractual repayment obligations agreed to
under the consensual restructuring proposal entered into with its
major creditors (the "Consensual Restructuring") has become
challenging.
In light of the foregoing, Maudore has entered
into discussions with Cyrus Capital Partners ("Cyrus"), in
its capacity as a manager to FBC Holdings S.à r.l ("FBC"),
regarding certain changes to the covenants and maturity of the
proposed $6,000,000 liquidity
facility that FBC was to provide Maudore as part of the Consensual
Restructuring. Cyrus has advised Maudore that it will require
more time to diligence the 2014 Budget to determine whether to
amend the previous terms of its financial support of Maudore in
order to accommodate the cash flow profile of the 2014 Budget.
Cyrus may also require that the Company agree to certain other
terms to protect its existing investment as part of its continued
forbearance and support of the Company. The Company has not yet had
discussions with its other secured and unsecured creditors about
the 2014 Budget and its implications for the previously agreed
terms of the Consensual Restructuring.
As a result of the required changes to the
Consensual Restructuring and the uncertainties surrounding the
ability to secure creditor approval of any changes, the Company has
decided that it will no longer proceed with the Rights Offering and
all funds held by the Transfer Agent will be returned to
subscribers.
Maudore intends to continue assessing its
strategic alternatives given its current financial situation.
Further announcements will be made by the Company in due
course.
About Maudore Minerals Ltd.
Maudore is a Quebec-based junior gold company in
production, with mining and milling operations as well as more than
22 exploration projects. Five of these projects are at an advanced
stage of development with reported current and historical resources
and mining. Currently, gold production is ramping up at the
Sleeping Giant mine. The Company's projects span some 120 km,
east-west, of the underexplored Northern Volcanic Zone of the
Abitibi Greenstone Belt and cover a total area of 1,570 km² 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.
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.