Celadon Group (OTCPink: CGIP) announced a company update along with an update on its credit facility.
The press release said, “the company’s current primary focus areas are executing its operational improvement plan and replacing its existing credit facility with a long-term capital structure.”
CGIP said that the operational improvement plan calls for refreshing the tractor fleet, disposing of non-trucking operations-related real estate and improving the discipline of its asset-based truckload services in the U.S. as well as its cross-border operations.
CGIP entered into the 17th amendment of its credit facility on May 24, 2019 to provide the company with liquidity through June 28, 2019 as it evaluates credit facility repayment transaction proposals.
The amendment retains the June 28 maturity with a maximum outstanding amount of $122.7 million, with $93.8 million of maximum borrowing capacity. The agreement also stipulates a mandatory weekly cash budget.
“The budget and borrowing limit are designed to permit the Company to operate in the ordinary course of business,” said the press release.
Independent investment banking advisory firm, Evercore, has been retained by CGIP to lead the repayment transaction efforts.
“I am confident in our turnaround plan and our ability to execute it with a stable capital structure in place. We are speaking with multiple parties to negotiate a capital structure solution that most highly values our ongoing potential. We have already received support from tractor manufacturers and financing sources with new tractor deliveries underway and with an accelerated delivery schedule under a new capital structure,” said Celadon’s Chief Executive Officer Paul Svindland.
Over the last several weeks, Celadon has announced executive title changes, agreed to pay $42.2 million in restitution to shareholders regarding alleged accounting fraud and divested non-core business units.
