Niko Resources (NKO-T) Dec 21, '15 announces that it has reached an agreement with the institutional lenders of its US$340 million senior term loan facilities on an extension to the standstill period to provide the Company with additional time to pursue its strategic plan.
Subject to certain conditions, the lenders have agreed not to act until January 15, 2016 on any rights or remedies arising from any default on the term loan, provided that the lenders could terminate the standstill period with 10 days notice if they become of the opinion that there is no reasonable prospect of agreeing to a commercially acceptable strategic plan.
The Company continues to pursue a strategic plan to maintain the Company's core assets until the value of such assets can be enhanced for the benefit of the Company's stakeholders. The Company believes it has sufficient liquidity to fund the cash requirements of its operating subsidiaries in India and Bangladesh and its corporate general and administrative expenses for the foreseeable future, provided that it receives concessions from its key stakeholders to significantly reduce the cash outflows to these stakeholders until the value of the Company's core assets can be enhanced. These concessions are a key aspect of the strategic plan which the Company is currently negotiating with the lenders, representatives of the holders of the Company's 7% senior unsecured convertible notes due December 31, 2017, and the parties to the Diamond Settlement Agreement. The strategic plan that the Company is pursuing will likely be subject to certain approvals by certain stakeholders and could have a significant negative impact on securityholders and other stakeholders and the value of their interests in the Company. No assurance can be made that any strategic plan can be accomplished at all or on a timely basis. The failure to effect a transaction pursuant to a strategic plan on a timely basis could prove to be unsatisfactory for stakeholders, which would likely have a material adverse impact on the value of their interest in the Company.
A copy of the second standstill agreement will be filed on the Company's SEDAR profile at www.sedar.com. For further information on the liquidity and capital resources of the Company, please see the Company's MD&A for the three and six-month periods ended September 30, 2015, filed on the Company's SEDAR profile at www.sedar.com.
Niko Resources Ltd.
Glen Valk
VP Finance & CFO
(403) 262-1020
www.nikoresources.com |
