TORM gets restructuring support deal, amortization default forbearance

By Caroline Salls

Pittsburgh, March 26 – TORM A/S reached an agreement with some of its lenders and Oaktree Capital Management that will secure lender support to implement a restructuring, according to a news release.

As previously reported, TORM entered into a restructuring agreement with a group of lenders and Oaktree in October. The original restructuring agreement was set to expire on March 31.

However, the terms of the agreement with some of the lenders and Oaktree are set in a new restructuring agreement.

In addition, the company said it obtained forbearance of potential events of default in connection with amortizations scheduled to begin on March 31 on its ship financing.

TORM said the scheduled amortizations could lead to an event of default under its financing agreements.

The forbearance granted by the company’s lenders will expire on the earlier of the finalization of a new restructuring agreement and April 23.

The company said the forbearance will give it a limited amount of extra time to obtain signatures to the new agreement from its stakeholders.

TORM’s super senior working capital facility has already been fully repaid and will terminate on March 31, the release said.

As of Thursday, TORM’s cash position was $51 million.

General meeting results

According to a separate release, the company’s annual general meeting was held March 26, with the following occurring at the meeting:

The 2014 annual report was approved;

• A proposal that no dividend be distributed for financial year 2014 and that the net result of negative $237 million be carried forward was approved;

• The board of directors’ proposal to authorize it to increase the company’s share capital for the period until April 30, 2016 through issuance of new shares up to a total of DKK 375 million with pre-emptive subscription rights for existing shareholders was approved;

• The board’s proposal to authorize it to issue warrants for the period until April 30, 2016 with pre-emptive subscription rights for the existing shareholders granting the holders the right to subscribe for up to DKK 80 million of shares was approved;

• The board’s proposal to authorize it in the period until April 30, 2016 to increase the share capital by up to a total of DKK 700 million at or above market price without pre-emptive subscription rights to existing shareholders was approved;

• The board’s proposal to authorize it in the period until April 30, 2016 to increase share capital by issuance of new shares against cash payment, contribution of assets other than cash or conversion of debt by up to a total of DKK 700 million with pre-emptive subscription rights for the existing shareholders was approved;

The board’s proposal to authorize it in the period until April 30, 2016 to increase the share capital by up to DKK 375 million at or above market price without pre-emptive rights for existing shareholders was approved;

• The board’s proposal to authorize it in the period until April 30, 2016 to issue warrants to third parties and without pre-emptive rights for existing shareholders, which would grant holders the right to subscribe for up to DKK 80 million of shares was approved;

• The board’s proposal to authorize it in the period until April 30, 2016 to increase the share capital without pre-emptive subscription rights for the existing shareholders to up to DKK 1 million at or above market price was approved;

• The board’s proposal to authorize it in the period until April 30, 2016 to increase share capital by up to a total of DKK 700 million at a rate discounted to the market price without pre-emptive rights to existing shareholders was approved;

• The board’s proposal to authorize it in the period until April 30, 2016 to increase share capital by up to a total of DKK 375 million at a rate discounted to the market price without pre-emptive rights to existing shareholders was approved;

• The board’s proposal to authorize it in the period until April 30, 2016 to issue warrants to third parties without pre-emptive rights for existing shareholders, which grants holders the right to subscribe for up to DKK 80 million of shares was approved; and

• The board’s proposal to authorize it to complete a possible transaction before April 30, 2016 involving a transfer on fair market terms of all or part of the company’s assets and liabilities to another entity in consideration for equity, cash or such other fair consideration was approved.

TORM is a Copenhagen-based carrier of refined oil products and is involved in the dry bulk market.

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