Adanac Molybdenum Corporation to Evaluate Strategic Alternatives Under CCAA Protection
December 19, 2008 - Vancouver, British Columbia
Adanac Molybdenum Corporation (�Adanac or the Company�, - TSX: AUA, Pink Sheets: AUAYF, Frankfurt: A9N) announced today that it has obtained creditor protection under the Companies� Creditors Arrangement Act (Canada) (the �CCAA�) pursuant to an initial order granted on December 19, 2008 (the �Initial Order�) by the Supreme Court of British Columbia (the �Court�). The Company�s Board of Directors authorized the Company to take this action as the best alternative for the long-term interests of the Company, its employees, creditors and other stakeholders.
Adanac has sought protection under the CCAA as its current cash in hand would not allow it to meet its current obligations. CCAA protection will stay creditors, suppliers and others from enforcing any rights against the Company and will afford the Company the opportunity to restructure its affairs. The Court has granted CCAA protection for an initial period of 28 days expiring January 16, 2009, to be extended thereafter as the Court deems appropriate. If by January 16, 2009 Adanac has not filed a Plan of Arrangement (the �Plan�), or obtained an extension of the CCAA protection, creditors and others will no longer be stayed from enforcing their rights. Adanac will provide a further news release on or before January 16, 2009 which will provide an update.
While under CCAA protection, Adanac�s management remains responsible for the day-to-day operations of the Company, under the supervision of KPMG Inc., who is the Court-appointed Monitor, and who will be responsible for reviewing Adanac�s ongoing operations, assisting with the development and filing of the Plan, liaising with creditors and other stakeholders and reporting to the Court.
Although CCAA protection enables Adanac to continue with its day-to-day operations until its CCAA status changes, the implications for Adanac�s shareholders are less clear. Adanac continues to explore a number of alternatives, a sale of Adanac or its assets. However, the Plan must be approved by the requisite number and value of the affected creditors, as required by law, as well as by the Court. At the end of the restructuring process, the value of what is left for shareholders will depend upon the terms of the Plan approved by the affected creditors. If the Plan is not so approved it is possible that Adanac would be placed into receivership or bankruptcy. Every effort will be made to ensure that all stakeholders of Adanac are kept informed of developments as they occur.
The Order appointed KPMG Inc. as Adanac�s Monitor. Enquiries may be directed to:
Attention: Mr. Mark Kemp-Gee,
KPMG Inc.
777 Dunsmuir Street, PO Box 10426
Vancouver, BC V7Y 1K3
Telephone: (604) 691-3397
Facsimile: (604) 691-3036
Email: mkempgee@kpmg.ca
About Adanac Molybdenum Corporation
Adanac Molybdenum Corporation is listed on the TSX and Frankfurt exchanges and owns the Ruby Creek Project in northern British Columbia. The Company has advanced the project through feasibility studies, a production decision and has previously ordered long-lead equipment, completed permitting for construction, constructed a road to the site and secured US$80 million in bridge financing.
Information Contact
Peter R. Jones � Chairman & CEO
Suite 200 � 2055 152 Street, Surrey, B.C. V4A 4N7
Telephone: (604) 535-6834 Facsimile: (604) 536-8411
Email: info@adanacmoly.com
Cautionary Notice: The Reader is cautioned that the full Cautionary Notice is not attached to this email. The reader is requested to access the news release on the Company�s website at www.adanacmoly.com or at SEDAR at www.sedar.com to read the full Cautionary Notice. The full Cautionary Notice is not attached as the recipient�s spam filters frequently block receiving emails containing the full Cautionary Notice.