IBI Group gets needed consents to extend 7% convertible debentures

By Jennifer Chiou

New York, July 16 – IBI Group Inc. announced that it received consents from holders of 71.2% of its 7% convertible subordinated debentures at a special meeting held on Wednesday.

The company may now extend the maturity date of the convertibles to June 30, 2019 from Dec. 31, 2014.

The meeting date had been pushed back from July 7, while the deadline for submitting proxies was previously extended to 5 p.m. ET on July 14 from July 3.

The company said at the start of the offer that it could be forced to convert the debentures into common shares if the amendments failed to pass, which “will likely result in significant adverse consequences for IBI’s business.”

Holders who consented could choose between two consent fee options.

Option A is a consent fee consisting of an unsecured non-convertible promissory note equal to C$195.65 per C$1,000 principal amount of debentures, payable Dec. 31, 2016 and bearing interest at 7% per year and payable at maturity.

Option B is a consent fee consisting of an unsecured non-convertible promissory note equal to C$86.96 per C$1,000 principal amount of debentures, payable Dec. 31, 2016 and bearing interest at 7% per year and payable at maturity, and the reduction of the conversion price for the debentures to C$5.00 per common share from C$19.17 per common share.

Holders who did not deposit a proxy, abstained from voting on the amendments or voted against the amendments will receive the benefit of the reduction of the conversion price to C$5.00 per share.

The consent solicitation began on May 7. The meeting was originally scheduled for May 28 and was later postponed to June 27 and then to July 7.

When the offer began, the consent fee on offer was an unsecured, non-convertible promissory note equal to C$70 per C$1,000 principal amount of convertibles payable Dec. 31, 2016 and bearing interest at the rate of 7% per year and payable at maturity. The company announced the amended consent fee on May 27.

IBI Group is an architecture, planning, engineering and technology firm based in Toronto.

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