The Court of Queen’s Bench for Saskatchewan granted an order extending their stay of proceedings for the Morris Group under the companies’ Creditors Arrangement Act (CCAA) to March 27, 2020.
The Morris Group is made up of Morris Industries, Morris Sales and Service, Contour Realty and Morris Industries (USA).
The extension enables the companies to continue with their efforts to restructure their business and financial affairs.
The court also approved the companies’ request for the following:
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- Implementation of a Sales and Investment Solicitation Process (SISP)
- Implementation of a Claims Process
- Debtor in Possession or interim financing
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The companies have been able to secure Interim Financing from Bank of Montreal in the amount of $5.7 million. Based on the companies cash flow forecast for the period January 10, 2020 to April 10, 2020, the interim
financing is anticipated to allow the companies to continue operations in the ordinary course, and facilitate restructuring activities during the forecast period.
The companies, with the support of the Monitor and their primary secured lenders, believe that a SISP which provides for the greatest flexibility in soliciting interest from various parties for the sale or investment in the shares or assets of the companies; a refinancing, reorganization, recapitalization, joint-venture, merger, or other business transaction involving the companies, or some combination thereof, will provide the greatest opportunity for the Morris Group to complete their restructuring.
Based on the companies cash flow forecast for the period January 10, 2020 to April 10, 2020, the DIP financing is anticipated to allow the companies to continue operations in the ordinary course, and facilitate their restructuring activities during the forecast period.
The Monitor has advised the Court that the companies were continuing to act in good faith and with due diligence, acknowledged that the Companies required additional time to implement their restructuring activities, and concluded that no creditor would be materially prejudiced by the Stay Extension.
The companies believe that with the support from their secured lenders and additional time to implement their restructuring strategies, the Morris Group will be in the best position to restructure its affairs and formalize a Plan for consideration by their creditors.
Morris Group’s primary operating company, Morris Industries, carries on business as a farm equipment manufacturer.
