“We are pleased to have the support of each of our lenders as we navigate the unprecedented challenge presented by the effects of COVID-19 and the significant degradation and volatility in crude oil prices. In response, ClearStream has moved to ensure the safety and health of our people and to maintain liquidity, minimize capital outlays and emphasize cost reductions across all facets of our business,” commented
Senior Secured Debentures
ClearStream currently has
As Canso currently holds approximately 16% of ClearStream's outstanding common shares, approximately 99.8% of the outstanding Series 1 preferred shares, 100% of the outstanding series 2 preferred shares and 100% of the outstanding Senior Secured Debentures, it is an “insider” and "related party" of ClearStream and the Payment in Kind Transactions constitute a “related party transaction” under Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions ("MI 61‑101"). ClearStream is relying on the financial hardship exemption for both the formal valuation and minority approval requirements of MI 61-101 for the Payment in Kind Transactions.
Asset-Based Lending Facility
ClearSteam has an asset-based lending facility (the “ABL Facility”), which is comprised of (i) a revolving credit facility providing for maximum borrowings of up to $65 million (the “Revolving Facility”) with a syndicate of banks (the "Lenders") and (ii) a term loan facility providing for maximum borrowings of up to
The Lenders and Canso have agreed to amend the ABL Facility to, among other things: (a) provide the option to defer interest owing on amounts drawn on the Revolving Facility at the end of May, June and
Assuming that the amount drawn on the Term Loan Facility remains constant at
BDC Facilities
ClearStream has two secured loans totaling
BDC has agreed to postpone effective
Outlook
At this time, it is difficult to reliably estimate the full impact of the COVID-19 pandemic and oil price supply/demand imbalance on our business. We remain focused on protecting the health and safety of our workers, supporting our customers and managing our liquidity.
The
Our liquidity position remains strong with cash and available credit facilities of approximately $34 million as at
Like most businesses, we have had to adjust our cost structure as the economy slowed and our customers cancelled and deferred work. With the support from our lenders, customers and Federal and Provincial government programs, we will maintain our capabilities and service offerings so that we will be ready to support our customers when they resume normal operations.
About
With a legacy of excellence and experience stretching back more than 50 years, ClearStream provides solutions to the Energy and Industrial markets including: Oil & Gas, Petrochemical, Mining, Power, Agriculture, Forestry, Infrastructure and Water Treatment. With offices strategically located across
Chief Financial Officer (587) 318-0997 rwatt@clearstreamenergy.ca | Chief Executive Officer (587) 318-0997 ypaletta@clearstreamenergy.ca |
Advisory Regarding Forward-Looking Information
Certain information included in this press release may constitute “forward-looking information” within the meaning of Canadian securities laws. In some cases, forward-looking information can be identified by terminology such as “may”, “will”, “should”, “expect”, “plan”, “anticipate”, “believe”, “estimate”, “predict”, “potential”, “continue” or the negative of these terms or other similar expressions concerning matters that are not historical facts. Specifically, this press release contains forward-looking information relating to: our business plans, strategies and objectives; the amount of deferred interest payments on the Term Loan Facility; the impact of the COVID-19 pandemic and oil price supply/demand imbalance on our business; the
Forward-looking information involves significant risks and uncertainties. A number of factors could cause actual events or results to differ materially from the events and results discussed in the forward-looking information, including, but not limited to, the success of our response to the COVID-19 global pandemic, risks related to the integration of acquired businesses, conditions of capital markets, economic conditions, commodity prices, dependence on key personnel, interest rates, regulatory change, ability to meet working capital requirements and capital expenditure needs, factors relating to the weather and availability of labour. These factors should not be considered exhaustive. Risks and uncertainties about ClearStream’s business are more fully discussed in ClearStream’s disclosure materials, including its annual information form and management’s discussion and analysis of the operating and financial results, filed with the securities regulatory authorities in
Although the forward-looking information is based on what management of ClearStream consider to be reasonable assumptions based on information currently available to it, there can be no assurance that actual events or results will be consistent with this forward-looking information, and management’s assumptions may prove to be incorrect.
This forward-looking information is made as of the date of this press release, and ClearStream does not assume any obligation to update or revise it to reflect new events or circumstances except as required by law. Undue reliance should not be placed on forward-looking information. Forward-looking information is provided for the purpose of providing information about management's current expectations and plans relating to the future. Readers are cautioned that such information may not be appropriate for other purposes.
Source:
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