Huldra Silver Inc. engages Haywood Securities as strategic advisor and provides update on Dip Loan

VANCOUVER, B.C., September 10, 2013 – Huldra Silver Inc. (“Huldra” or the “Company“) announces that it has entered into a Strategic Advisory Agreement with Haywood Securities Inc. (“Haywood“) whereby Haywood has agreed to provide strategic advisory services to the Company to identify alternatives to resolve the Company’s current and future debt obligations and to unlock value from the Company’s assets, including but not limited to, raising capital that may be required to stabilize the Company’s going-concern operations, disposing of certain assets, facilitating a merger or takeover of the Company by a third party, providing input into the development of a formal restructuring plan in the CCAA proceedings and conducting a strategic review (the “Strategic Review“). The Strategic Review will include, but not be limited to:

  • meeting with the Company’s Board of Directors, senior management, major creditors, major shareholders, Grant Thornton LLP (the court appointed Monitor), technical advisors and such other additional parties as Haywood deems necessary;
  • reviewing information related to the business, operations and financial performance of the Company, its peer group, and any other party which Haywood considers to be relevant;
  • reviewing such financial, market and industry information and conducting such other analyses as Haywood considers relevant and appropriate in the circumstances;
  • reviewing and evaluating financing options and considering asset disposition opportunities, debt restructuring and other opportunities available to the Company;
  • considering and evaluating strategic opportunities and alternatives for the Company; and
  • meeting with and introducing the Company to investors, analysts and industry participants to solicit interest in the Company and its strategic opportunities and alternatives.

The Company has agreed to pay Haywood a work fee of up to $100,000 and a success fee depending on the outcome of the services provided. The agreement is subject to approval of the TSX Venture Exchange.

On August 15, 2013, the Company and Waterton Global Value, L.P. (“Waterton“) entered into a Credit Agreement (the “Credit Agreement“) pursuant to which Waterton agreed to provide a secured debtor-in-possession loan (the “DIP Loan“). Under the terms of the Credit Agreement, the DIP Loan will be advanced by Waterton by way of a first advance, which will be advanced in several tranches, of up to $2,300,000 in aggregate (collectively, the “First Advance“) and a second advance (at Waterton’s sole absolute discretion) of up to $2,500,000 in aggregate (the “Second Advance” and together with the First Advance, the “Advances“) upon receipt by Waterton of a comprehensive plan of operations from the Company for the Treasure Mountain Property that is satisfactory to Waterton and its advisors (the “Plan“).

On August 16, 2013, the Company drew down a first tranche of $1,189,024 under the First Advance, which allowed the Company to continue its care and maintenance program at its mine and mill while attempting to restructure its financial affairs.

Waterton has recently advised the Company that, after a review of a plan to recommence mining operations at the Treasure Mountain Property, it has elected not to proceed with the Second Advance under the DIP Loan but will consider further tranches under the First Advance to allow the Company to continue its care and maintenance program at its mine and mill while attempting to restructure its financial affairs.

On behalf of the Board of Directors

Garth Braun
CFO & Director

For additional information contact:
Garth Braun at 604-647-0142
garth@huldrasilver.com
IR@huldrasilver.com

Disclaimer for Forward-Looking Information

This press release contains projections and forward-looking information that involve various risks and uncertainties regarding future events including: (i) that Huldra will be able to restructure its financial affairs, (ii) that Huldra, together with Haywood, will be able to identify and successfully implement any alternatives to deal with Huldra’s current and future debt obligations and unlock value from Huldra’s assets, (iii) that Waterton will provide any additional advances under the DIP Loan, (iv) that a transaction that restructures the affairs of the Company in such a way that maximizes value to all stakeholders will be completed, (v) that the Company and Haywood will receive all required approvals for the Strategic Advisory Agreement, and (vi) the timing and duration of CCAA protection. No assurance can be given that any of the events anticipated by the forward-looking statements will occur as planned or at all, or, if they do occur, what benefits the Company will obtain from them. These forward-looking statements reflect management’s current views and are based on certain expectations, estimates and assumptions which may prove to be incorrect. A number of risks and uncertainties could cause the Company’s actual results to differ materially from those expressed or implied by the forward-looking statements, including: (1) that Huldra is unable to secure additional financing or make arrangements with its creditors, (2) that Huldra and Haywood will be unable to identify alternatives to successfully deal with Hulda’s current and future debt obligations and unlock value from Huldra’s assets, (3) that Waterton does not provide any additional advances under the DIP Loan, (4) that one or more of the conditions precedent to any advance under the DIP Loan is not satisfied, (5) that there may be competing uses for the proceeds of the DIP Loan, (6) that Huldra and the court appointed monitor will not be able to agree upon a plan of compromise or arrangement or that such a plan, if agreed to by Huldra and the court appointed monitor, is not acceptable to Waterton and/or other creditors for any reason whatsoever, (7) that any plan of compromise or arrangement may not be approved by the court in the CCAA proceedings, (8) that any plan of compromise or arrangement that is approved by the creditors and the court in the CCAA proceedings may not be successfully implemented for whatever reason, (9) that any plan of compromise or arrangement that is approved by the creditors and the court in the CCAA proceedings may not maximize value for all stakeholders, (10) that the timing and duration of CCAA protection may be shorter than expected, (11) a downturn in general economic conditions in North America and internationally, (12) volatility and fluctuation in the prices of silver, lead and zinc, (13) volatility and fluctuation in the price of the Company’s stock and stock of resource issuers generally, (14) the uncertainty involved in CCAA proceedings and the implementation of a plan of restructuring under the CCAA, and (15) other factors beyond the Company’s control. Readers are cautioned that the foregoing list of factors is not exhaustive. These and all subsequent written and oral forward-looking information are based on estimates and opinions of management on the dates they are made and expressly qualified in their entirety by this notice. Except as required by law, the Company assumes no obligation to update forward-looking information should circumstances or management’s estimates or opinions change.

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 release.