CALGARY, ALBERTA--(Marketwired - July 14, 2016) - Northern Frontier Corp. (TSX VENTURE:FFF) ("Northern Frontier" or the "Corporation") announces that the Corporation's senior secured lenders (the "Lenders") have demanded repayment under their credit facilities (the "Credit Facilities").
As previously announced, Northern Frontier had taken numerous steps to mitigate the significant and prolonged depression in commodity prices and resulting negative impact on the Corporation's operating results. The Lenders had provided a temporary waiver, and a number of extensions, since December 24, 2015 of certain financial covenant breaches under the Credit Facilities. Management and certain members of the board of directors (the "Board") have worked diligently with the Lenders, over an extended period of time, on coming to a positive resolution for all stakeholders. Effective July 4, 2016, the Corporation requested and the TSX Venture Exchange (the "Exchange") agreed to halt the trading of the shares of the Corporation pending news, due to the magnitude and potential risk that material information related to negotiations with the Lenders could be selectively disclosed to third parties based on the number of parties involved. Furthermore, it was determined by the Corporation that partial disclosure of events that had transpired subsequent to June 30, 2016 without disclosure of a definitive resolution would not be in the best interests of all stakeholders.
On July 13, 2016, the Lenders issued a demand letter and notice under section 244 of the Bankruptcy and Insolvency Act whereby the Lenders set forth their intent to enforce their security for repayment of approximately $41.0 million owed under the Credit Facilities.
The Corporation has consented to the early enforcement by the Lenders of its security and to the appointment of a receiver. The application for the appointment of the receiver is scheduled to be heard on or before July 15, 2016 at the Court of Queen's Bench in Calgary, Alberta at a time yet to be determined. Following such, the receiver is expected to be PricewaterhouseCoopers who will be in charge of managing the day-to-day affairs of Northern Frontier and should be contacted with respect to any questions concerning the assets and liabilities of the Corporation.
Northern Frontier also announces that Chris Yellowega, Director, President and Chief Executive Officer, has resigned from the Corporation effective July 2, 2016. The Board thanks Mr. Yellowega for his contributions and wishes him the best on his future endeavors. Concurrently Rob Hunt, Director and Chairman of the Corporate Governance, Compensation and Nomination Committee, was appointed Executive Chairman by the Board.
Furthermore, Trevor Haynes and Don Basnett have resigned as directors of the Corporation effective July 12, 2016 and July 4, 2016, respectively. The Board thanks Mr. Haynes and Mr. Basnett for their involvement since inception of Northern Frontier. As well, as previously disclosed, the Corporation has completed the shut-down of its civil construction operations, effective June 30, 2016.
Immediately prior to appointment of the receiver, it is expected that all remaining directors being Rob Hunt, Brad Creswell, John Jacobs, Darin Coutu and Murray Schur and officer being Monty Balderston will resign.
Corporation's shares will remain halted until such time that the Exchange deems appropriate.
About Northern Frontier Corp.
The Corporation's common shares are listed on the Exchange under the trading symbol "FFF".
This news release includes certain statements that constitute forward-looking statements under applicable securities legislation. All statements other than statements of historical fact are forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "estimate", "predict", "potential", "continue", or the negative of these terms or other comparable terminology. These forward-looking statements include, among other things, statements in respect of:
- The anticipated appointment of a receiver; and
- The resignation of all of the Corporation's directors and officers.
These statements are only predictions and are based upon current expectations, estimates, projections and assumptions, which the Corporation believes are reasonable but which may prove to be incorrect and therefore such forward-looking statements should not be unduly relied upon. In making such forward-looking statements, assumptions have been made regarding, among other things, the appointment of the receiver which is subject to the approval of the Court of Queen's Bench. Although the Corporation 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.
By its nature, forward-looking information involves numerous assumptions, known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur. Investors are cautioned that forward-looking statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. The Corporation has no obligation to update any forward-looking statements set out in this news release, except as required by applicable law.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.