Wayzata, Minnesota-based Northern Oil and Gas Inc. (NYSE MKT: NOG) has terminated Michael L. Reger as Northern's CEO, effective immediately. In addition, Reger is no longer a member of Northern's Board of Directors.
On August 11, Reger received a “Wells Notice” from the staff of the Securities and Exchange Commission (SEC) in connection with an ongoing investigation of 2012 trading patterns in the securities of Dakota Plains Holdings Inc. in which Reger was an initial investor in 2008. The Wells Notice stated that the staff has made a preliminary determination to recommend that the SEC institute an enforcement action against Reger, alleging violations of certain federal securities laws, including Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The Wells Notice is neither a formal allegation nor a finding of wrongdoing.
Northern Oil and Gas noted it is cooperating with the SEC and will continue to do so, stating it never owned any interest in Dakota Plains.
The company has named Thomas W. Stoelk as interim CEO. Stoelk has served in several executive positions in the oil and gas industry over the last 25 years and has been Northern's CFO since December 2011. Prior to joining Northern, Stoelk served as the vice president of finance and CFO at Superior Well Services Inc. Chad Allen, Northern's existing corporate controller, has been named to the position of chief accounting officer. Prior to joining Northern Oil and Gas, Allen was in the audit practice with Grant Thornton LLP from 2010 to 2013.
Struggling with low oil prices, Northern's Board has been evaluating strategic alternatives and has engaged Tudor, Pickering, Holt & Co. as its financial advisor.
"We are fortunate to maintain access to over $220 million of unused capacity under our senior secured revolving credit facility and don't face a bond maturity until 2020,” Stoelk said in a prepared statement.
There can be no assurance that the review of strategic alternatives will result in a transaction. Northern does not intend to comment further regarding the evaluation of strategic alternatives.