Vancouver, B.C. – Starcore International Mines Ltd. (“Starcore” or the “Company”) announces that it has closed out the hedge contracts between its wholly-owned Mexican subsidiary, Compañia Minera Peña de Bernal, S.A. de C.V. (“Bernal”), and Investec Bank plc (“Investec”). Funds advanced to Starcore through the $11 million credit facility arranged with Sprott Resource Lending Corp. were used to settle Starcore’s outstanding forward sales contracts with Investec (see news release of May 10, 2012).
The Company entered into gold forward sales contracts with Investec in January 2007, when Starcore acquired Bernal and the San Martin mine. The original contracts for 81,876 total ounces were to be settled over 72 months, and the final 10,885 ounces to be settled over the final 9 months to January 31, 2013, were repurchased for $9,041,809 at a close out price averaging $1,562.25 per ounce. The Company has now fully repaid Investec and expects to be released from all commitments under the January 31, 2007 convertible loan acquisition facility agreement.
“Buying out the hedge releases Starcore from its heavy covenants under our original agreement with Investec,” said Robert Eadie, CEO of Starcore. “Now that we’re unfettered, we’ve got everything in place to make giant strides — a highly qualified technical advisory board with outstanding credentials and achievements in the industry, an exploration team committed to new discoveries and increased reserves for San Martin mine; and with the hedge out of the picture, we now have an open doorway to take advantage of an unparalleled gold market. I feel very strongly that Starcore will show dynamic progress and can now build an even stronger asset base for our shareholders.”
ON BEHALF OF STARCORE INTERNATIONAL
Signed “Robert Eadie”
Robert Eadie, Executive Chairman, Interim President and
Chief Executive Officer
FOR FURTHER INFORMATION PLEASE CONTACT: Telephone: 1-604-602-4935
Toll Free: 1-866-602-4935 / Facsimile: 1-604-602-4936
This press release includes certain statements that may be deemed “forward-looking statements”. All statements in this release, other than statements of historical facts, are forward-looking statements. Although Starcore believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include fluctuations in the price of gold and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in the forward-looking statements. For more information on Starcore, investors should review Starcore’s Annual Information Form and annual Management Discussion & Analysis in Canada available on the SEDAR website at www.sedar.com. Starcore does not undertake any obligation to release publicly any revisions to any “forward-looking statement” to reflect events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events, except as may be required under applicable securities laws. Investors should not place undue reliance on forward looking statements.