Northland Power Inc.

Northland Power Inc.

August 22, 2013 19:06 ET

Northland Power Announces the Conversion of Remaining Convertible Securities Resulting From Recently Completed Projects

TORONTO, ONTARIO--(Marketwired - Aug. 22, 2013) - Northland Power Inc. ("Northland") (TSX:NPI)(TSX:NPI.PR.A)(TSX:NPI.PR.C)(TSX:NPI.DB.A) announced today that its remaining Class C Convertible Shares and all of its Class B Convertible Shares have converted to Class A Shares and all of its remaining Replacement Rights are now convertible to Common Shares pursuant to the terms of those securities.

A process for determining the convertibility of these securities (the "Determination Process") was established as part of the terms of the 2009 merger between Northland Power Inc. and Northland Power Income Fund and is incorporated in Northland's corporate Articles of Arrangement. Pursuant to the Determination Process, a special committee of the independent directors of Northland (the "Special Committee") retained BMO Capital Markets as an independent financial advisor (the "Financial Advisor") to determine the Fair Market Value and the Development Profits (as defined in the 2009 merger documents and corporate articles) of certain recently completed Northland projects.

The terms of Northland's Class B Convertible Shares and Class C Convertible Shares provide that these shares may be converted into Class A Shares based on the Development Profits attributable to certain of Northland's electricity generation projects as they are completed. Development Profits are determined by the Determination Process and are calculated as the mid-point of a fair market value range of the projects at completion as determined by the Financial Advisor, less the actual project costs and other adjusting items. The Special Committee provided direction and oversight to the Financial Advisor. The report prepared by the Financial Advisor is not a "formal valuation" for purposes of Multilateral Instrument 61-101.

Northland's North Battleford natural gas facility achieved commercial operation on June 5, 2013. In addition, four of Northland's Ground-mounted Solar Phase I projects achieved commercial operation on June 21, 2013. Lastly, Northland has continued to receive payments associated with the sale of its South Kent development project. These projects were determined to be all of the qualifying projects to be included in the current Determination Process.

The Financial Advisor determined that the total Development Profit for these qualifying projects, after the required adjustments, was more than sufficient to convert the remaining Class C Convertible Shares and all of the Class B Convertible Shares. As a result, 4,289,808 Class C Convertible Shares and 8,067,723 Class B Convertible Shares have been converted into Class A Shares on a one-for-one basis (the "Conversions"). There are no further Class C Convertible Shares or Class B Convertible Shares outstanding.

All of the Class C Convertible Shares and Class B Convertible Shares were held by Northland Power Holdings Inc. ("NPHI"), a corporation indirectly owned by James C. Temerty, the Chair of the Corporation. Contemporaneously with the Conversions, NPHI converted all of the Class A Shares received as a result of the Conversions into an equal number of Common Shares. Mr. Temerty beneficially owns or has control or direction over 47,276,608 Common Shares and 1,000,000 Class A Shares.

Northland also announced that 759,355 contingent Replacement Rights securities held by senior management of Northland have now become convertible into Common Shares on a one-for-one basis pursuant to the terms of those securities and proportionate to the conversion of the Class C Convertible Shares. The holders of these Replacement Rights have exercised their rights to acquire Common Shares in full. Accordingly, no Replacement Rights remain outstanding.


Northland Power is an independent power producer founded in 1987, and publicly traded since 1997. Northland produces 'clean' (natural gas) and 'green' (wind, solar, and hydro) energy, providing sustainable long-term value to shareholders, stakeholders, and host communities. The company owns or has a net economic interest in 1,319 MW of operating generating capacity, with an additional 90 MW of generating capacity currently in construction, and another 200 MW of wind, solar and run-of-river hydro projects with awarded power contracts. In addition, Northland has acquired the rights to a majority equity stake in Gemini, a 600 MW offshore wind project located 85 km off the coast of the Netherlands in the North Sea. Northland's cash flows are diversified over five geographically separate regions and regulatory jurisdictions in Canada, Europe and the United States.

Northland Power's common shares, Series 1 and Series 3 preferred shares and convertible debentures trade on the Toronto Stock Exchange under the symbols NPI, NPI.PR.A, NPI.PR.C and NPI.DB.A, respectively.

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