The management team at Procon Group, which is seeking to recoup money owing from Golden Band Resources. Photo courtesy procongroup.net
A company that mined gold in the La Ronge area until 2013 is fighting a bid that would put it into receivership.
According to the Saskatoon-based Golden Band Resources it owes its creditor Procon Resources $19.6 million, saying the money is owing from a credit agreement dating back to August 13, 2012.
Earlier this week, Procon delivered notice that it plans to secure Golden Band’s property, inventory, or accounts receivable to recoup that value.
The possibility of Golden Band starting its mining operations back up in La Ronge hasn’t looked good since it laid off more than 100 workers in 2013.
The picture gets grimmer when you look at Golden Band’s stock – its worth is $0.0005 per share.
In recent interviews with MBC, its president and CEO Al Saxton still hadn’t thrown in the towel.
Now, Golden Band is trying to avoid that by offering a proposal to its creditors. In a news release issued Friday, Golden Band said it’s planning to restructure and file a Notice of Intention to make a proposal to its creditors.
Golden Band says the filing of the NOI gives it a 30-day stay of proceedings, during which creditors may not commence or continue action against Golden Band. The company intends to seek at least one 45-day extension of the stay from a Saskatchewan court.
It also says the restructuring of Golden Band will take at least 75 days – but there is no guarantee that the company will be able to restructure its business and affairs.
Golden Band insists it will restructure in a way that will keep its head above water, but that’s only if its creditors accept the terms of this proposal.
Procon’s connection to Golden Band
MBC contacted Procon Resources for comment on its plans to recoup its loan, but was told the company isn’t taking calls on Golden Band at this time.
There’s a large overlap of Procon’s current management and board of directors who used to be involved in Golden Band Resources.
In 2014, Johnny Mah was listed as Procon’s Chief Financial Officer (CFO). Mah had been the CFO of Golden Band from 2013 to early 2015.
When asked if Procon could confirm who its current CFO is, MBC was told they cannot answer that question at this time. However, its website names Christina Cheung as the current CFO.
Other names of note include Edward Yurkowski and James Dales. Both men resigned from Golden Band’s board of directors in Dec. 2015. Yurkowski is currently listed as the president of Procon; both Yurkowski and Dales are listed as founders of the Procon group of companies and members of the board of directors for Procon.
When Golden Band’s La Ronge-area mines were in operation, Procon was also involved in the joint partnership between itself, Kitsaki Development, and Golden Band.
History of Golden Band
By August of 2013, Golden Band was reporting a fiscal year that lost the company $27 million – and it continued hemorrhaging money for years following that. The plummeting profits continued into 2014, with its fiscal year seeing a net loss of more than $107.6 million. That number was down to $28.3 million in 2015.
In late 2013, Golden Band laid off its 120 workers in the La Ronge area and it hasn’t been in operation since. The company went into “care and maintenance mode,” with the goal of reducing losses.