Signs Forbearance Agreement with Lender Group
London, April 2, 2020 AEST (ABN Newswire) - Speedcast International Limited (
ASX:SDA) (7SC:FRA) (SPPDF:OTCMKTS), the world's most trusted provider of remote communication and IT solutions, today announced that it had signed a Forbearance Agreement with its lender group, effective from 31 March 2020.
- Speedcast has signed a Forbearance Agreement with its lender group in relation to certain obligations due 31 March 2020, and a potential covenant breach for the period to 31 December 2019
- Speedcast continues to progress discussions with its lender group for an interim funding package, as part of an overall restructuring of the Company's balance sheet
- Speedcast remains committed to working with its customers and suppliers through this unprecedented period to ensure continuity of their critical telecommunications services
During the course of finalising Speedcast's FY19 results, it became apparent that it was likely that the Company would not satisfy the net leverage covenant under its Syndicated Facility Agreement (SFA) as at 31 December 2019 (with that covenant calculation due to be provided to the lenders by the end of April). In addition, the impacts from the global COVID-19 coronavirus pandemic are being felt across the business, and current equity market conditions precluded a meaningful equity raising to support a recapitalisation.
Accordingly, the Company has negotiated a Forbearance Agreement under the SFA by which its lenders would provide temporary forbearance of actions under the SFA as a result of the breach, and other breaches including the non-payment of interest and amortisation as of 31 March 2020.
The Forbearance Agreement is intended to assist with the Company's liquidity position, to provide stability and to allow ongoing trading while the terms of the interim funding are finalised. Speedcast continues to progress discussions with its lender group to implement an interim funding package to allow the Company to continue operating and progress its recapitalisation and restructuring to reduce the overall leverage of the Company.
The Forbearance Agreement is scheduled to expire on 17 April 2020, and includes customary provisions that require Speedcast to continue to operate as far as possible, in the ordinary course.
Speedcast remains committed to working with its customers and suppliers through this unprecedented period to ensure continuity of the critical telecommunications services it provides.
About Speedcast International Ltd
Speedcast International Ltd (ASX:SDA) is the world's most trusted communications and IT services provider, delivering critical communications solutions to the Maritime, Energy, Mining, Media, Telecom, Cruise, NGO, Government, and Enterprise sectors. With more satellite capacity than any other provider, Speedcast enables faster, seamless pole-to-pole coverage from a global hybrid satellite, fiber, cellular, microwave, MPLS, and IP transport network with direct access to public cloud platforms. The company also integrates differentiated technology offerings that provide smarter ways to communicate and distribute content, manage network and remote operations, protect and secure investments, and improve the crew and guest experience. With a passionate customer focus and a strong safety culture, Speedcast serves more than 3,200 customers in over 140 countries. Learn more at www.speedcast.com.
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