Fortress Global Enterprises Completes $15 Million Financing Deal to Continue Operations
Sept 3, 2019 - Fortress Global Enterprises announced that its wholly owned subsidiaries, Fortress Specialty Cellulose Inc. and Fortress Bioenergy Ltd. (together, the "Borrowers") have entered into a financing agreement (the "Financing Agreement") with their secured lenders or their affiliates (together, the "Lenders"), providing for a senior secured credit facility in the amount of up to $15,000,000 (the "Facility").
The first advance under the Facility in the amount of $2,500,000 will be completed tomorrow (Sept. 4), with additional drawdowns available to the Borrowers from time to time in accordance with preapproved budgets and subject to customary conditions. The Facility is designed to provide the Company with supplemental liquidity to allow for uninterrupted operations in order to execute its previously announced strategic and financing initiative (the “Strategic Initiative”), which includes seeking and pursuing a recapitalization, restructuring and/or business combination transaction.
Giovanni Iadeluca, President and Chief Executive Officer of Fortress, commented: "We are very pleased to have completed the Facility arrangements within an expedited timeframe with the help of our two senior lenders. The provision of the Facility will help address Fortress' immediate financial needs during a period of unprecedented weakness in dissolving pulp pricing, and is a strong indication of the support and commitment of Fortress' senior lenders to ensure that the Fortress Specialty Cellulose mill operations continue uninterrupted as we continue in earnest with our Strategic Initiative."
The Facility is guaranteed by the Fortress group of companies and will be secured by a first ranking security interest over all present and after acquired assets and property of Fortress and its subsidiaries. In addition, $10,000,000 of the Facility remains subject to approval of the Québec Government. The Facility will accrue interest at a rate of 10% per annum, payable monthly in arrears.
The Facility will mature on the earliest to occur of certain events, including: (i) the completion of a restructuring/recapitalization or other material transaction or the sale of all or substantially all of the property, assets and undertakings of Fortress that results in the repayment in full of the Facility obligations; and (ii) October 15, 2020. In addition, the Financing Agreement contains specific deadlines for the submission of non-binding indications of interest under the Strategic Initiative and, if applicable, binding proposals which may be extended under certain circumstances.
Fortress Global operates its dissolving pulp business at the Fortress Specialty Cellulose mill located in Thurso, Quebec, which also operates in the renewable energy generation sector through its cogeneration facility. Fortress operates its bioproducts business through Fortress Advanced Bioproducts Inc., which has laboratory and pilot plant facilities in Vancouver, British Columbia. To learn more, please visit: www.fortressge.com.
SOURCE: Fortress Global Enterprises Inc.
Go to a related story on PaperAge.com:
» Fortress Global Enterprises Announces Strategic and Financial Initiative - Aug. 22, 2019.