CannTrust Holdings secured a commitment for a debtor-in-possession and Companies’ Creditors Arrangement Act exit credit facility from Cortland Credit Lending, subject to certain conditions, including obtaining approval from the Ontario Superior Court of Justice under the Companies’ Creditors Arrangement Act (Canada) at a hearing scheduled for April 30.
The credit facility, for which Cortland Credit Lending is serving as administrative agent, consists of a revolving loan, under which repayments and additional drawdowns will be permitted from time to time, provided that the amounts owing under the credit facility shall not exceed the borrowing limit of C$22.5 million ($17.83 million). The credit facility will have a term of 12 months, which may be extended for an additional 12 months upon mutual agreement.
The credit facility will be secured by a first-ranking security interest over all assets of CannTrust, subject to certain permitted encumbrances and certain excluded assets, and, during the pendency of the CCAA proceedings, a first-ranking super-priority DIP financing charge.
CannTrust will use funds advanced under the credit facility to fund working capital needs and to support the restoration of its operations. CannTrust remains under CCAA protection to facilitate its efforts to resolve its civil litigation claims and complete its review of strategic alternatives.
