Performance Sports Group Ltd. said it received 60-day extension from its lenders to file its Annual Report on Form 10-K, avoiding a default.
As a result of the amendments, the Annual Filings and the Company’s first quarter filings must be filed or provided to the lenders by October 28, 2016.
On August 15, Performance Sports said it expected to default on its loan because of delays in a financial filing caused by an unspecified internal investigation.
Performance Sports said the amendments also grant the company with continued access to borrowings under its revolving credit facility, which provides it with liquidity to fund operations as the company continues to operate its business and serve its customers in the ordinary course.
The company has agreed to increase the applicable margin by 1.5 percent (of which 1 percent is payable in kind) under the term loan credit facility and by 0.5 percent under the revolving credit facility, subject to certain levels of leverage and availability.
Retention of Centerview Partners LLC
The company also announced that its board of directors has formed a special committee comprised of independent directors, and such committee has retained Centerview Partners LLC as its independent financial advisor to assist in the review and evaluation of strategic alternatives and in the company’s ongoing discussions with its lenders.
Application for Management Cease Trade Order
As a result of the delay in filing the annual filings, the company has made an application with securities regulators for a management cease trade order (MCTO) be imposed in respect of this late filing. If the MCTO is granted and until the Annual Filings are filed, management of the company plans issue bi-weekly default status reports in the form of news releases so long as the company remains in default of the filing requirements. Management will also be restricted from trading in the securities of the company during the period.
The company owns the Bauer, Mission, Maverik, Cascade, Inaria, Combat and Easton brand names.
