Monday, 15 January 2007

Russ Horner Resigns

In case you haven't heard:

From Catalyst's Daily Digest:
Catalyst board accepts executive resignations, search for successors underway

The company issued the following news release today:

Catalyst Paper’s board of directors today announced that it has accepted the resignations of two executives who have elected to exercise change of control agreements.

Russ Horner, president and chief executive officer, and Ralph Leverton, vice-president, finance and chief financial officer, have tendered their resignations. An executive search is underway to identify their successors and both executives have agreed to remain with the company to the end of the next annual meeting of shareholders, to be held on March 28, 2007, or the appointment of successors or interim successors, to assist in the transition.

"Russ stabilized the operational and financial performance of our company during a challenging period of industry restructuring and consolidation," said board chairman Keith Purchase. "At the same time, Ralph led the cost management and capital refinancing of the business to significantly improve the balance sheet during a protracted downturn in this cyclical sector.

"We appreciate their loyalty, dedication and willingness to facilitate a smooth transition as the board completes its selection of new executives who will build on the fundamental strengths of the business."

Russ worked for Catalyst and its predecessor companies for more than 30 years. Prior to his appointment to lead Catalyst Paper, he served as chief operating officer, Australasia for Fletcher Challenge Paper, president and chief operating officer of Fletcher Challenge Canada and president and chief executive officer of Norske Skog Canada. In 2001, he guided the merger of Norske Skog Canada and Pacifica Papers to create NorskeCanada, which was renamed Catalyst Paper in 2005.

During Russ’s tenure, Catalyst Paper set new benchmarks for safety, and community and environmental group relations in British Columbia.

Ralph joined Catalyst in 1999 after holding executive positions at Pope & Talbot and Harmac Pacific and a variety of financial positions with MacMillan Bloedel.

The recent acquisition by Third Avenue Management LLC of an additional 39 million common shares of Catalyst on behalf of various client accounts, exceeding a 25 per cent threshold established under the executives’ agreements with Catalyst, constituted a change of control under such agreements. Under the terms of the control change agreement, Russ and Ralph are entitled to receive change of control and pension benefits totalling $4,779,865 and $1,582,546, respectively, on the date that their employment ends.
And from Russ himself:
January 15, 2007

We’ve come a long way – now it’s time to pass the baton

Earlier today, our board of directors announced that it had accepted my resignation as president and chief executive officer and Ralph Leverton’s resignation as vice-president, finance and chief financial officer.

The board is looking for successors, and Ralph and I have agreed to stay with the company until the annual general meeting this March, or the appointment of successors or interim successors, to make sure the transition to new leadership is smooth.

The recent changes in board and ownership structure make this an appropriate time to make a transition in executive leadership as well. I know this announcement may take some of you by surprise. The fact is that change at the top is a reality for most corporations.

It has been my privilege to work with you and to lead our company as president and CEO for the past several years. I have been in this industry for more than 30 years, and the last few years have been some of the most interesting and demanding as we moved through a period of extensive restructuring and consolidation.

I would like to take a moment to recognize the lasting contribution Ralph has made since joining the company in 1999. During his tenure he brought focus to our balance sheet and guided our financial restructuring through mergers, acquisitions as well as timely and cost-saving debt refinancing. He also greatly improved the transparency and depth of our disclosure reporting and has been my partner through many complex and challenging developments.

At times like this, it’s natural for employees to wonder what the future will hold. Those who know me best will appreciate that I have made a habit of dealing in facts rather than speculation, so I would say the best thing to do is to stay focused on safety, quality and performance. This is what we’re known for at Catalyst and how ongoing value can be created for customers and shareholders.

When I became this company’s president I committed to guiding it through the initial phases of restructuring – improving efficiency, reducing costs and moving up the product value curve. Reaching our rightful place as a leader in our sector reflects what all of you have done. We’ve made great progress, much of it thanks to your energy and enthusiasm, and I have every confidence that new leadership will continue to build on the performance culture that is now in place.

Russ Horner

President and CEO

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