10th Jul 2015 07:25
LONDON (Alliance News) - Sefton Resources PLC shares fell on Friday morning after it said former Executive Chairman Jim Ellerton, who initiated legal proceedings against the company in May, has filed documentation in an attempt to "force the company into bankruptcy proceedings".
Sefton shares were down 7.1% to 0.0790 pence per share on Friday morning.
Ellerton lodged the original legal claim against the company, two directors and one former director in May, claiming damages related to his resignation from the company's board, the termination of his consulting contract and a deal with Hawker Energy.
Sefton on Friday said Ellerton has filed an involuntary petition under Chapter 7 of the US bankruptcy code to try to force the company into bankruptcy.
"The company believes that Mr Ellerton has filed the petition in bad faith, and that the petition is invalid under the US bankruptcy code, a view supported by the company's US legal counsel," said the company in a statement.
"The company will move to dismiss the petition, and will seek all available remedies under the code, including attorneys' fees, costs, and compensatory or punitive damages," it added.
Sefton said the petition does not prevent it from running its operations as usual, and reiterated it is funded and remains solvent. The petition will also not stop Sefton from pursuing counter-claims against Ellerton, something which the company "fully intends to pursue," it said.
By Joshua Warner; [email protected]; @JoshAlliance
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