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CALGARY, Alberta, Aug. 07, 2025 (GLOBE NEWSWIRE) — FLINT Corp. (“FLINT” or the “Company“) (TSX: FLNT) is pleased to announce a proposed recapitalization transaction (the “Recapitalization“) that will significantly reduce the Company’s debt and annual interest costs, simplify its capital structure and improve liquidity. The Recapitalization is the result of an extensive review process conducted by the Company’s board of directors (the “Board“), which culminated in FLINT entering into a definitive recapitalization support agreement (the “Support Agreement“) with its largest shareholder and primary lender, Canso Investment Counsel Ltd., in its capacity as portfolio manager for and on behalf of certain accounts that it manages (“Canso“). The Recapitalization is intended to preserve value for the Company’s shareholders and better position FLINT to execute on future growth opportunities.
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Barry Card, Chief Executive Officer of FLINT, commented: “This Recapitalization marks a pivotal milestone in FLINT’s evolution. With the continued support of Canso and our other stakeholders, we are well-positioned to accelerate our strategic objectives. The Recapitalization enhances our ability to deliver our comprehensive service offerings, broaden our geographic reach, and further diversify our end markets. We are energized by the opportunities ahead and remain committed to creating long-term value for our shareholders and all stakeholders.”
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Key Terms of the Recapitalization
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The proposed Recapitalization will be implemented by way of a plan of arrangement (“Plan of Arrangement“) under the Business Corporations Act (Alberta) (the “ABCA“) and includes the following key elements:
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- all of the Company’s 8.00% senior secured debentures of the Company due October 14, 2027 (the “Senior Secured Notes“), in the aggregate principal amount of $135,335,053, together with all interest accrued from and after June 30, 2025, will be exchanged for the issuance of new common shares in the capital of the Company (the “Common Shares“) representing approximately 90% of the total number of Common Shares issued and outstanding upon completion of the Recapitalization;
- all entitlements to accrued and unpaid dividends under the Company’s issued and outstanding series 1 cumulative redeemable convertible preferred shares of the Company (the “Series 1 Preferred Shares“) and the series 2 cumulative redeemable convertible preferred shares of the Company (the “Series 2 Preferred Shares“, and collectively with the Series 1 Preferred Shares, the “Preferred Shares“), will be extinguished;
- all of the issued and outstanding Preferred Shares will be exchanged for the issuance of new Common Shares representing approximately 7.5% of the total number of Common Shares issued and outstanding upon completion of the Recapitalization;
- the Common Shares will be consolidated (the “Share Consolidation“) on a basis of one post-consolidation Common Share for every 40 pre-consolidated Common Shares;
- upon completion of the Recapitalization, existing holders of Common Shares (“Common Shareholders“) will retain their existing Common Shares, subject to the Share Consolidation, such that the Common Shareholders will own approximately 2.5% of the total number of Common Shares issued and outstanding upon completion of the Recapitalization;
- in connection with the Recapitalization, the Company has agreed to enter into a registration rights agreement with Canso prior to closing of the Recapitalization, which shall grant Canso certain registration rights in respect of future sales of Common Shares for so long as it beneficially controls at least 10% of the Common Shares;
- total debt will be reduced by approximately C$135,335,053 and annual cash interest expense reduced by approximately C$10,826,804;
- obligations to employees, customers and suppliers will not be affected by the Recapitalization and will continue to be satisfied in the ordinary course; and
- the Company’s other existing credit facilities will be unaffected by the Recapitalization.
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Under the terms of the Support Agreement, Canso has agreed to vote the following securities it controls or manages in favour of the Recapitalization:
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- 97% of the outstanding Senior Secured Notes;
- 99% of the outstanding Preferred Shares; and
- 10% of the outstanding Common Shares.
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In addition, all of the directors of FLINT that hold Common Shares and / or Preferred Shares have entered into separate voting support agreements pursuant to which they have agreed to vote all of their Common Shares, representing approximately 6.9% of the issued and outstanding Common Shares and 0.057% of the issued and outstanding Preferred Shares, in favour of the Recapitalization.
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The Recapitalization, will, among other things proactively address the maturity and interest obligations under the Senior Secured Notes, the accrued and unpaid dividends on the Preferred Shares and simplify the Company’s capital structure through the elimination of the Senior Secured Notes and the outstanding Preferred Shares. It is also anticipated that the Recapitalization will allow FLINT to pursue its strategic initiatives and growth plans to the benefit of all its shareholders.
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