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49 North Resources Inc. Sets Meeting Date for New Proposal to Restructure Debentures

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TSX Venture Exchange Symbol FNR

SASKATOON, SK, Feb. 3, 2021 /CNW/ - After discussions with debentureholders, 49 North Resources Inc. ("49 North" or the "Company") (TSXV: FNR) is calling a joint meeting of the holders of all if its issued and outstanding Debentures (as defined below) to consider a new restructuring proposal. The new proposal will see the conversion price for all Debentures set at $0.15 per share instead of $0.20 as was proposed in 2020. The proposal also provides that the Debentures will be redeemable in whole or in part at the option of the Company from time to time on not more than 60 and not less than 30 days prior notice at the face value of the Debentures plus accrued and unpaid interest. Further, 49 North will also commit to use 50% of the net proceeds of any financing it completes during the term of the Debentures to redeem Debentures, on a pro rata basis.

The Company has set March 22, 2021 as the date of the joint extraordinary meeting (the "Debentureholder Meeting") of the holders of its 2015 2.5% Convertible Senior Secured Debentures – Series 1 (the "Series 1 Senior Debentures"), the holders of its 2015 2.5% Convertible Senior Secured Debentures – Series 2 (the "Series 2 Senior Debentures", and together with the Series 1 Debentures, the "Senior Debentures") and the holders of its 2015 2.5% Convertible Subordinated Secured Debentures (the "Subordinated Debentures", and together with the Senior Debentures, the "Debentures") to consider the new proposal. At the Debentureholder Meeting, the applicable debentureholders will be asked to consider the following amendments to the applicable Debentures:

  1. Extend the maturity date of the Debentures by three (3) years;

  2. Amend the Debentures' conversion price to $0.15 for the remainder of the term of the Debentures;

  3. The Company shall have the right, at its sole option and from time to time, to redeem the Debentures in whole or in part on not more than 60 and not less than 30 days prior notice for the face value of the Debentures plus accrued and unpaid interest, subject to the right of the holders to convert prior to such prepayment; and

  4. Add a covenant of the Company to use 50% of the net proceeds of any financing it closes during the term of the Debentures to redeem the principal of and interest on the Debentures, on a pro rata basis.

Other than the amendments listed above, the terms of the Debentures will remain unchanged.

The amendments are subject to the condition precedent that all of the Debenture amendments are effected contemporaneously. Upon the amendments to the Debentures becoming effective, the defaults of the Company resulting from its failure to pay the principal amount of the Debentures on June 30, 2020 and December 18, 2020, as applicable, shall be waived.

Definitive information with respect to the proposed Debenture amendments, once finalized, will be outlined in a management information circular (the "Circular") expected to be disseminated in February 2021. The proposal is made, with respect to the Senior Debentures, pursuant to the provisions of the trust indenture dated May 27, 2015 (the "Senior Indenture") and, with respect to the Subordinated Debentures, pursuant to the provisions of the trust indenture dated December 18, 2015 (the "Subordinated Indenture"), each between 49 North and Alliance Trust Company of Canada (the "Trustee") and which allows for the desired amendments upon approval of at least 66⅔% of the principal amount of the applicable Debentures voted at the Debentureholder Meeting, either in person or by proxy or by written resolution. Implementation of the amendment is subject to receipt of necessary approvals from the TSX Venture Exchange.

The Company has elected to use notice-and-access provisions of applicable securities law to deliver the meeting materials for the Debentureholder Meeting, including the Circular, to debentureholders. The Company will send a notice (the "Notice-and-Access Notice") along with a proxy or voting instruction form to debentureholders. The Notice-and-Access Notice informs that the Circular (and certain other meeting materials) will be posted online and explains how a debentureholder can access those materials or obtain a paper copy of such meeting materials from the Company.

On March 22, 2021 the Debentureholder Meeting will be held at the offices of 49 North, 602 – 224 Fourth Avenue South, Saskatoon, Saskatchewan, at 10:00 a.m. (Central Standard Time). In light of ongoing concerns related to the spread of COVID-19, and in order to mitigate potential risks to health and safety of debentureholders, employees and other stakeholders, 49 North is encouraging debentureholders and others not to attend the Debentureholder Meeting in person. Instead, we encourage you to vote your Debentures prior to the meeting.

Anyone who regards their physical attendance at the Debentureholder Meeting as essential is asked to contact 49 North at (306) 653-2692 so that appropriate measures can be put in place to facilitate physical distancing and other precautions to ensure the health and safety of all attendees. 49 North will follow the guidelines and orders of the Provincial and Federal Public Health Authorities in that regard, including those restricting the size of public gatherings.

All debentureholder documents will be available for download on the Company homepage at: www.fnr.ca in due course.

About 49 North Resources Inc.

49 North is a Saskatchewan focused resource investment company. The Company's diversified portfolio of assets includes investments in shares and other securities of junior and intermediate mineral and oil and gas exploration companies.

CAUTION REGARDING FORWARD LOOKING STATEMENTS

Information in this news release that is not a statement of historical fact constitutes forward-looking information. Forward-looking statements contained herein include statements relating to any amendment to the terms of the Debentures, any actions or approvals of the TSX Venture Exchange, the Trustee or the applicable debentureholders with respect to amending the Debentures. Forward-looking statements are based on assumptions management believes to be reasonable at the time such statements are made. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. Factors that may cause actual results to differ materially from expected results described in forward-looking statements include, but are not limited to: the risk that any amendment to the Debentures may not be approved by the TSX Venture Exchange, the Trustee or the applicable debentureholders, the risk that the Trustee may take enforcement action under the Senior Indenture, Subordinated Indenture and/or related security agreements, uncertainties as a result of the global Covid-19 pandemic as well as those risk factors set out in the Company's Management Discussion and Analysis and other disclosure documents available under the Company's profile at www.sedar.com. Forward-looking statements contained herein are made as of the date of this news release and the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or results or otherwise, except as required by applicable securities laws.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE 49 North Resources Inc.

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