Trident Resources Corp. Announces Reorganization, Disposition and Financing

CALGARY, ALBERTA--(Marketwired - July 4, 2014) - Trident Resources Corp. ("Trident") announces that it has successfully reorganized its Canadian operations and disposed of 10% of those operations for gross proceeds of $107 million. Trident also announces the completion of a $95 million secured debt financing that, coupled with the disposition proceeds was used to repay its existing secured lending facilities in full and for working capital purposes.

Reorganization

Under the reorganization of Trident's Canadian operations, Trident Exploration Corp. ("TEC"), Trident's Canadian operating subsidiary prior to the reorganization, contributed all of its operating assets and working capital to a newly formed limited partnership, Trident Limited Partnership ("TLP"), and all of its long-term debt obligations to NRL Energy Investments Ltd. ("NRL"), a sister company of TEC and wholly-owned subsidiary of Trident. NRL became a limited partner holding 90% of the issued and outstanding limited partnership units of TLP, with the remaining 10% of the issued and outstanding limited partnership units of TLP being held by TEC. Trident Exploration (Alberta) Corp., a wholly-owned subsidiary of NRL, is the general and managing partner of TLP and holds a nominal unit ownership position.

Disposition

Post-reorganization, TEC, along with 1808039 Alberta Ltd. ("1808039"), a wholly-owned non-operating subsidiary of Trident, were sold to an unrelated third party for gross proceeds of $107 million. At the time of the sale, TEC's only asset was a 10% interest in TLP and 1808039's only asset was an intercompany note receivable from TEC. Of the proceeds from the sale, $15.2 million is currently being held in escrow subject to certain release conditions including confirmation of TEC obligations being transferred to TLP and purchase price adjustments, if any, to be determined within 18 months of the sale.

Financing

Concurrently with completion of the transactions described above, NRL obtained a $95 million secured debt facility from a syndication of banks. The proceeds of this financing, along with the proceeds from the disposition of TEC and 1808039, were used to fully repay Trident's long-term secured lending facilities and for working capital purposes.

Immediately following completion of these transactions, and excluding amounts held in escrow, Trident's long term debt position net of cash has been reduced by approximately $87 million. In addition, Trident's liquidity position has improved to approximately $50 million of undrawn credit and cash on hand.