Tervita skips interest payment on 10 7/8% notes, eyes recapitalization

By Angela McDaniels

Tacoma, Wash., Aug. 15 – Tervita Corp. has elected not to make the $18.2 million interest payment that was due Aug. 15 on its 10 7/8% senior notes due 2018 at this time, according to a company news release.

The failure to make the interest payment on Aug. 15 is not an event of default. The company has a 30-day grace period to make the payment.

The company said it plans to use the grace period to continue discussions with its lender and noteholder groups about a recapitalization transaction that will reduce long-term debt. No agreement about a recapitalization transaction has been reached, and the company gave no assurances that any agreement will be forthcoming.

The company said it has enough liquidity to maintain ongoing operations. This liquidity includes cash on hand and continued access to its C$350 million revolving credit facility.

Tervita is a Calgary, Alta.-based environmental management company for the oil and gas industry.

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