Maudore Minerals Ltd.

Maudore Minerals Ltd.

July 10, 2012 13:01 ET

Maudore Responds to Dissidents' Misleading and Inaccurate Allegations

MONTREAL, QUEBEC--(Marketwire - July 10, 2012) - Maudore Minerals Ltd. (TSX VENTURE:MAO)(OTCBB:MAOMF)(FRANKFURT:M6L) responded today to misleading and inaccurate allegations by a group of dissident shareholders led by Mr. Rex Harbour.

Ironically, Mr. Harbour's allegations coincide with a positive report on Maudore's current board and management issued by Institutional Shareholder Services (ISS), which provides independent and unbiased advice on proxy contests.

"No matter what Rex Harbour may say, ISS has confirmed that the present board and management team has a record marked by steadiness, consistency and the conservative preservation of capital", Ron Shorr, Maudore's chief executive, said. "We are carrying out a very active but also prudent exploration and development program that will move us to a production decision as soon as feasible."

In accordance with ISS' recommendations, Maudore shareholders are urged to protect their investment by voting their BLUE proxy in support of the management slate of board nominees ahead of the annual meeting on July 19, 2012. The voting deadline is 10am (Toronto time) on July 17, 2012.

A Rejoinder to Rex Harbour's Charges:

  • The fact that Mr. Harbour's group provided a substantial amount of Maudore's last financing is surely proof of their faith in current management. Nothing has substantially changed since the investment except the continued discovery of high grade gold - two new discoveries in the last two months.
  • Maudore's newest directors are well chosen and well respected. George Pirie is the CEO of San Gold, a successful Manitoba gold mining company. Raynald Vezina has overseen the pre-production phase of numerous base metal and gold companies. Dale Wallster has, among other accomplishments, been instrumental in one of the largest uranium discoveries in Canada in the last thirty years.
  • The management slate also includes Scott Jobin-Bevans, an eminent geologist who recently served as president of the Prospectors and Developers Association of Canada. Last year, he presided over the world's largest mining convention.
  • Maudore management also has high-quality technical expertise, Our chief operating officer Kevin Weston has a strong technical background. The purpose of the newly-appointed technical committee is to augment these professionals, not to fill a void.
  • As the ISS report notes, management's slate has more years of technical experience than Mr. Harbour's nominees. All in all, Maudore's slate of directors has the skills, experience, relationships and industry knowledge to continue to provide strong leadership.

The Dissident Nominees: Inexperienced and Beholden to Rex Harbour

Rex Harbour controls all three pillars of the dissident group -- Rex Harbour Associates, the Harbour Foundation and City Securities.

Rex Harbour and Associates is registered in Monaco. The Harbour Foundation is a charitable foundation registered in the UK whose board consists entirely of Harbour family members including Daniel Harbour, the son whom Rex Harbour is proposing to add to Maudore's board. City Securities Ltd., registered in the Marshall Islands, is also wholly owned and controlled by Rex Harbour and family members. Trading personal holdings alongside those of a public charitable foundation raises serious conflict-of-interest and ethical questions.

Mintails' Record: Another Matter for Concern

Mr. Harbour used these three entities when he carried out a takeover in the spring of 2011 of Australian-listed Mintails, which operates a gold reclamation project in South Africa.

Mintails, according to the independent analysis of Microaxis, "has return on total assets of (19.79)%, which means that it has lost $19.79 on every $1.00 spent on assets. This is far below average." The company also has a very high debt burden. It should be noted that Howard Carr, currently on the board of Mintails, is Mr. Harbour's candidate for CEO of Maudore.

Mr. Harbour paid a premium for his takeover of Mintails, and appears to have lost a great deal of money since then, as have any minority shareholders.

The Current Board has Sought to Engage Mr. Harbour: To No Avail

Mr. Harbour seeks to seize control of Maudore by installing his own group of directors, rather than offering shareholders the premium typically paid for an acquisition.

He began by demanding the resignation of several board members and the addition of his own candidates-essentially giving him control by changing the balance of the board.

When the current board, negotiating in good faith and wishing to accommodate legitimate shareholder representation, offered some of his candidates positions on the board, Rex Harbour rejected the proposal. It appears that he has a hidden agenda to seize control rather than gain representation. Maudore's board has concluded that this would be unfair to the majority of shareholders.

Mr. Harbour's accusations that Maudore's management refused to speak to him are easily disproved by conversations between him and board members, as well as many email communications.

Despite Maudore's efforts to accommodate Mr. Harbour's demands, he appears single-minded in his determination to seize control. Such tactics do not bode well for a responsible, transparent management to which the remaining majority of shareholders can entrust their investment.

Maudore: Steady, Consistent and Financially Responsible

Contrary to Mr. Harbour's assertions, Maudore's management is "driving toward production as fast as possible," as clearly evidenced by Maudore's extensive drilling program for several years as it diligently and rapidly explores its large holdings in the Comtois district.

The board will prudently move to production only once it is apparent that there is a resource base that can be profitably mined and that all necessary preparatory work has been concluded. Maudore has a clear exploration and development plan and is executing it. Mr. Harbour and his group do not know the site, except for information they learned in what the board views as a breach of a confidentiality agreement. (Our press release of July 9, 2012, provides further details of the Harbour group's underhanded tactics.)

Mr. Harbour says his group needs 100 days to come up with a plan. This sounds like delay - not action. Indeed, there is no guarantee that this deadline will be met.

By contrast, Maudore can already point to several exciting recent new gold discoveries, and strong value creation for you, our shareholders. As ISS notes in its report, Maudore's "3-year and 5-year total shareholder return to the date of dissident circular filing have significantly outperformed the S&P/TSX materials sub-index over the same period."

The report adds: "The offices of the CEO and the chair are separated. Cash compensation is conservative and overall pay appears to be aligned with performance. In light of the above, there is no significant noted problematic governance practice."

Maudore is clearly a company on the right track. As ISS declares: "The dissidents have not made a compelling case that a change to the board is necessary at this time."

Attention Maudore shareholders:

You MUST protect your investment by voting your BLUE proxy to support your current board and vote well in advance of the deadline of 10am (Toronto time) on July 17, 2012.

If you have any questions about your vote, please contact Kingsdale Shareholder Services at 1-866-230-2635 toll free in North America or at (416) 867 2272 outside of North America (collect calls accepted) or by email at

About Maudore Minerals Ltd.

Maudore owns 100% of the Comtois gold project in Quebec, as well as a large land area west of Comtois with volcanogenic gold/massive sulphide (VMS) potential. VMS gold deposits are more common in Quebec than anywhere else in the world. Maudore's total land package now extends over 94,000 hectares (235,000 acres or 367 square miles).

Statements in this release that are not historical facts are "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 and Canadian Securities laws. Forward-looking statements include, but are not limited to, statements with respect to Maudore's strategy, plans or future financial or operating performance or the possibility of defining future mineral deposits. Forward-looking statements are based on forecasts of future results, estimates of amounts not yet determinable and assumptions that, while believed by management to be reasonable, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Forward-looking statements are characterized by words such as "plan," "expect", "budget", "target", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "could", "may" or "will" occur. Forward-looking statements involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond the control of Maudore, including, but not limited to, the impact of the general economic conditions, inherent risks involved in the exploration and development of mineral properties, the uncertainties involved in interpreting drill results and other exploration data, the potential for delays in exploration or development activities, the geology, grade and continuity of mineral deposits, the possibility that future exploration, development or mining results will not be consistent with Maudore's expectations, accidents, equipment breakdowns, title matters, labour disputes or other unanticipated difficulties with or interruptions in operations, fluctuating metal prices, unanticipated costs and expenses, dependence upon regulatory approvals and the availability of financing and other related risks and uncertainties. Readers are cautioned that any such statements are not guarantees of future performance and that the actual developments or results may vary materially from those in these "forward-looking statements".

Maudore undertakes no obligation to update forward-looking information except as required by applicable law. Such forwardlooking information represents management's best judgment based on information currently available. Accordingly, readers are advised not to place undue reliance on forward-looking statements or information.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release. Neither the TSX Venture Exchange nor its regulation services provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

Contact Information

  • Media Inquiries:
    Ronald Shorr
    Chief Executive Officer
    514 761 1415