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December 23 , 2013

Jaguar Mining to file for creditor protection

TORONTO--Jaguar Mining Inc. announced that in order to refinance and restructure its capital structure and related obligations, the Company commenced proceedings under the Companies' Creditors Arrangement Act (the CCAA) in Ontario to complete its previously announced recapitalization and financing transaction (the Recapitalization) which has the following key elements:

• Reduction of total pro forma debt from $323 million as at September 30, 2013 to $54 million upon completion of the Recapitalization;

• Reduction of projected annual cash interest payments by $13 million; and

• Investment of approximately $50 million of new equity raised by way of a backstopped share offering by current holders of the Company's Convertible Notes (as defined below), the net proceeds of which will be available for use in Jaguar's operations.

The Recapitalization under the CCAA has the support of holders of approximately 93% of the aggregate principal amount of the Company's 4.5% Senior Unsecured Convertible Notes due November 1, 2014 and 5.5% Senior Unsecured Convertible Notes due March 31, 2016 (collectively, the Convertible Notes).

Jaguar's subsidiaries are not parties to Jaguar's CCAA proceedings. The operations of Jaguar and its subsidiaries are intended to continue as usual and obligations to employees and suppliers during the restructuring process are expected to be met in the ordinary course. Jaguar management will remain responsible for the day-to-day operations of the Company.

"The CCAA process will allow us the time and stability required to implement the Recapitalization, while continuing our normal day-to-day operations," said David Petroff, Chief Executive Officer of the Company. He continued, "We believe that a court supervised restructuring of Jaguar's business is the best method available to secure its future. We are moving forward with our restructuring and refinancing objectives to strengthen the Company and allow it to pursue all of its strategic alternatives."

 

 

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