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Orbite Technologies (TSXV:ORT.H) has announced further to its press release of July 27, 2017, the Superior Court of Quebec granted a motion filed by the company under the Companies’ Creditors Arrangement Act, and issued am amended order to extend the stay of all proceedings from August 1, 2017 to October 31, 2017 and approve the …
Orbite Technologies (TSXV:ORT.H) has announced further to its press release of July 27, 2017, the Superior Court of Quebec granted a motion filed by the company under the Companies’ Creditors Arrangement Act, and issued am amended order to extend the stay of all proceedings from August 1, 2017 to October 31, 2017 and approve the $6.8 million debtor-in-possession financing from the holders.
As quoted in the press release:
The terms and conditions of the DIP financing are set forth in a credit facility between the Company and Computershare Trust Company of Canada in its capacity as trustee for the holders of the 2015 ITC Debentures (the “Lender”). The terms and conditions namely provide for an interest rate of 9.25% payable on the first day of each month starting on September 1, 2017 and a termination date which shall occur on the earliest of a) February 23, 2018, b) the implementation of a plan of compromise or arrangement with respect to Orbite, c) the acceleration of the loan and the termination of the DIP financing upon the occurrence of an event of Default or d) upon refinancing of the DIP financing. A 1% commitment fee (or $68,000) is payable to the Lender upon closing as well as the payment by Orbite of the Lender’s legal fees and other expenses (the “Fees”).
The DIP financing will serve for working capital and other general corporate purposes as well as to pay fees and expenses related to Orbite’s restructuring process, and is expected to close by August 4, 2017. The order provides for the release of the funds to Orbite as follows, a tranche of $4.6 million will be transferred to Orbite upon closing and the remaining $2.2 million minus the Fees will be held in trust by PricewaterhouseCoopers, in its capacity as court appointed Monitor, and will be released to Orbite upon approval of the CCAA Court.
According to the Company’s cashflow projections filed with the CCAA Court, the $6.8 million funds to be received under the DIP financing should allow the Company to maintain its reduced operations until the week of February 22, 2018.
