TORONTO, Aug. 7, 2024
/CNW/ - Chesswood Group Limited ("Chesswood") (TSX: CHW)
announces that the Company will be unable to meet its filing
deadline of August 14, 2024, for its
interim condensed consolidated financial statements for the three
and six months ended June 30, 2024
and 2023 and management's discussion and analysis
("MD&A") for the corresponding period (collectively, the
"Interim Filings").
The Company will not be able to complete the Interim Filings
within the time periods required by National Instrument 51-102 –
Continuous Disclosure Obligations, primarily due to the
Company's determination, as announced on July 22, 2024, that it is required to refile and
restate its interim condensed consolidated financial statements for
the three months ended March 31, 2024
and 2023 and corresponding MD&A (the "Q1 Filings").The
requirement to restate and refile the Q1 Filings is as a result of
the Company becoming aware, as previously announced on
June 14, 2024, that after properly
adjusting for a system error, the Company was not in compliance
with its minimum borrowing base covenants under its syndicated
revolving credit facility (the "Credit Facility"), for which
the Company has obtained a waiver until September 16, 2024. The Company is also
undergoing a review to determine whether a restatement of any of
its prior year's financial statements and associated MD&A are
also going to be required.
In response to the Interim Filings delay, the Company has
applied to the Ontario Securities Commission ("OSC") for a
management cease trade order ("MCTO") under National Policy
12-203 – Management Cease Trade Orders ("NP 12-203")
that will prohibit the management of the Company from trading in
the securities of the Company until such time as the Interim
Filings are filed. No decision has yet been made by the OSC on this
application. The OSC may grant the application and issue the MCTO
or it may impose an issuer cease trade order if the Interim Filings
are not filed in a timely fashion.
The Company is continuing to complete the work necessary to
amend and restate the Q1 Filings and to determine whether any
further restatements of any 2023 filings will be required in order
to be in a position to finalize its Interim Filings as soon as
practicable. Until the Company files the Interim Filings, it will
comply with the alternative information guidelines set out in NP
12-203. The guidelines, among other things, require the Company to
issue bi-weekly default status reports, in the form of news
releases, for so long as the Interim Filings have not been
filed.
Until the Company has filed the Interim Filings, members of the
Company's management and other insiders are subject to an insider
trading black-out policy as per its internal Insider Trading Policy
that is consistent with the principles in Section 9 of National
Policy 11-207 - Failure-to-File Cease Trade Orders and
Revocations in Multiple Jurisdictions. The Company confirms
that, all material information concerning the affairs of the
Company have been disclosed in prior press releases and material
change reports. There are currently no insolvency proceedings
involving the Company.
There can be no assurance that any required further extensions
to the waiver under the Credit Facility will be obtained or that
any elements of the Credit Facility action plan as further
described in the Company's press release dated August 6, 2024 will be completed. As such,
no undue reliance should be placed on any expectations as to the
occurrence of any of the foregoing.
ABOUT CHESSWOOD GROUP LIMITED
Chesswood Group Limited is a Toronto,
Canada based holding company whose subsidiaries engage in
the business of specialty finance (including equipment finance
throughout North America and
vehicle finance and legal sector finance in Canada), as well as the origination and
management of private credit alternatives for North American
investors. Our shares trade on the Toronto Stock Exchange (under
the symbol CHW).
For information on Chesswood Group
Limited and its operating subsidiaries:
www.ChesswoodGroup.com
www.PawneeLeasing.com
www.TandemFinance.com
www.VaultPay.ca
www.VaultCredit.com
www.Rifco.net
www.WaypointInvestmentPartners.com
www.EasyLegal.ca
FORWARD-LOOKING INFORMATION
This press release contains forward-looking statements within
the meaning of applicable securities laws. Forward-looking
statements in this press release may include, but are not limited
to, statements relating to the MCTO application and the ongoing
efforts to complete the restated Q1 Filings, to complete the review
and determine whether the prior year financial statements and
associated MD&A are required to be restated, the ability to
finalize the Interim Filings and to meet reasonable timelines for
the filing thereof, the Company's pursuit of arrangements to
remedy, or in furtherance of an extension to the temporary waiver
of, the Company's breach under the Credit Facility, if any, and
other statements that are not material facts. Forward-looking
statements are typically identified by words such as "believe",
"expect", "anticipate", "project", "intend", "plan", "will", "may",
"estimate" and other similar expressions or the negative of these
words or variations of them or similar expressions.
Although the Company believes that the forward-looking
statements in this press release are based on information and
assumptions that are current, reasonable and complete, these
statements are by their nature subject to a number of factors,
risks and uncertainties, both general and specific in nature, that
could cause actual results to differ materially form those
expressed or implied by these forward-looking statements,
including, without limitation, the possibility that a further
extension to the waiver in relation to the Credit Facility covenant
breach may not be obtained, that the restatement of the Q1 Filings
may take longer than anticipated, that a review by the Company will
take longer than expected or result in a determination that the
prior year financial statements and associated MD&A will also
be required to be restated and refiled which will further delay
management's attention and ability to prepare and file the Interim
Filings. The Company cautions that the foregoing assumptions and
factors are not exhaustive and other factors could also adversely
affect its results. For more information on the risks,
uncertainties and assumptions that could cause the Company's actual
results to differ from current expectations, please refer to the
Company's publicly filed documents, including the Company's annual
information form and management's discussion and analysis of
financial condition and performance, which are available
electronically at www.sedarplus.ca.
Unless otherwise noted or the context otherwise indicates, the
forward-looking statements contained in this press release describe
the Company's expectations as at the date of this press release
and, accordingly are subject to change after such date. Except as
may be required by applicable securities laws, the Company does not
undertake any obligation to update or revise any forward-looking
statements contained in this press release, whether as a result of
new information, future events or otherwise. Readers are cautioned
not to place undue reliance on these forward-looking
statements.
NO STOCK EXCHANGE, SECURITIES COMMISSION OR OTHER REGULATORY
AUTHORITY HAS APPROVED OR DISAPPROVED THE INFORMATION CONTAINED
HEREIN.
SOURCE Chesswood Group Limited