Brainhunter Inc.

Brainhunter Inc.

September 21, 2009 19:30 ET

Brainhunter Provides Update

TORONTO, ONTARIO--(Marketwire - Sept. 21, 2009) -


Brainhunter Inc. ("Brainhunter" or the "Company") (TSX:BH) has become aware that there may be some confusion in the market place with respect to the status of its operations. The Bank has not taken any steps to enforce its security and the Company and its advisors are considering various options available to it.

Management is confident that the breach in the Banking covenants will not impede the Company's ability to continue to provide the service that its customers have grown to expect.

Notwithstanding that Brainhunter is in technical breach of its standstill agreement with its chartered bank and thus prohibited from making any distribution to the holders of its approximately $10.7 million in term promissory notes, the bank continues to work with Brainhunter as it continues the process of reducing costs and exploring various strategic and financing initiatives.

To date, the bank has not exercised its enforcement rights or demanded repayment of the principal owing on the $22 million operating credit facility. Furthermore, the bank has advised in its default notice letter that it does not anticipate pursuing its enforcement rights in the immediate future.

As previously disclosed, certain events of default are also continuing between the Company and its term lender under its $5.6 million subordinated term debenture. To date, the Company's term lender has also refrained from exercising its enforcement rights.

The Company has received several proposals from parties with respect to the previously announced process to seek strategic and/or refinancing alternatives. The Company continues to explore and discuss these proposals with the respective interested parties and evaluate such proposals with Ernst & Young Orenda Corporate Finance, its advisor in this process.

At the same time, the Company is also continuing to take steps to reduce its operating costs and improve efficiencies.

Business Overview
Brainhunter is specialized in the provision of staffing solutions (contingent staffing, managed staffing, permanent staffing and staffing software solutions) to major companies and governments in Canada and the U.S. Currently, the largest part of the business is providing IT and engineering staffing consultants, on a contract basis, to major companies and government entities in Canada. The Company also sells recruiting related software including applicant tracking systems ("ATS"), vendor management software ("VMS"), and job board software. Brainhunter deploys over 1,400 contractors with an internal staff of over 170 personnel. Operations are ISO 9001:2000 Certified.

Contact Information