12/9/2023 0 Comments Vice media cambodia![]() ![]() This was primarily caused by a delay in receiving a quarterly payment for the production of content for VICE World News (VWN) of about USD 34m that was due in mid-January under agreements with GMN Cayman Ltd (GMNC). Having just launched a sale process in accordance with the third forbearance agreement in January 2023, the debtors again faced a liquidity crunch. Pometti said the forbearance period was terminated due to failure to satisfy the milestones. The new directors, together with an existing independent board member, formed a special committee. The debtors agreed to milestones that required them to initiate a new process to solicit bids to sell substantially all of their assets, and Vice’s parent was required to appoint two new independent directors (selected by the lenders) to its board of directors. The parties also entered into an incremental credit amendment to the senior secured credit agreement to allow the debtors to get up to USD 30m in new senior secured term loans. The second forbearance agreement was followed by a third on 12 January, extending the forbearance period to 12 May. On 27 December 2022, the debtors, term lenders and agent entered into a second temporary forbearance agreement, which further extended the standstill period and required the appointment of the CRO. Under the agreement, the lenders and agent decided to forbear from taking enforcement actions under their credit agreement. Following an unsuccessful sale process in 2022-which itself followed failed efforts to pursue a SPAC transaction in 2022-the debtors, prepetition term lenders and Fortress Credit Corp, as administrative agent, entered into a forbearance agreement on 12 December 2022. Pometti noted that the lack of liquidity was especially problematic given ongoing capital requirements stemming from the fact that most of Vice’s businesses operate across platforms that require “near constant” adaption of new technologies, and the development of content which often takes multiple years to generate returns.Īccording to the declaration, the liquidity strain caused by the lack of profitability was further exacerbated late last year by the maturity of both the senior secured term loans and the senior subordinated notes. Although the fundraising efforts helped finance the company’s growth, they ultimately led to the company being “burdened by a highly leveraged and unusually complex” capital structure, Pometti said.Īs current market dynamics trended against the debtors, the substantial funded debt obligations, dividend requirements from various classes of preferred stock, and other non-operational expenses and obligations constrained liquidity and interfered with the ability to raise additional capital. As a result, it relied on external funding, raising both debt and equity capital to fuel its rapid growth and to fund expenses. Like many other companies in the media and technology sectors, Pometti said in his declaration, Vice has been cash flow negative for the last several years. The company also has an overdraft facility, and multiple series of notes. Vice’s prepetition debt largely stems from term loans, including USD 417.6m outstanding under an initial secured term loan and USD 57m outstanding under 2023 multi-draw terms loans. It distributes content across multiple distribution channels, such as digital platforms, social platforms, advertising-based and subscription video on demand streaming services, broadcast and cable television, live events, and experiential campaigns. Vice reaches its audience in multiple formats including editorial, digital and social video, experiential events, commercials, music videos, scripted and unscripted television, feature documentaries, and movies. Vice traces its roots back to 1994, when Shane Smith, the current chairman of the board of Vice’s parent, co-founded and launched Voice of Montreal – an alternative punk focused magazine – in Canada. Vice grew rapidly from a niche magazine into a global media company focusing on content centered on news and culture, serving a largely global youth audience, Chief Restructuring Officer Frank Pometti said in his first day declaration. A first day hearing was been scheduled for 16 May. The highly anticipated Chapter 11 petition, filed in the US Bankruptcy Court for the Southern District of New York, cited USD 1bn to USD 10bn in both assets and liabilities. The company also has a USD 225m stalking horse credit bid for its assets from prepetition term loan lenders. Vice Media filed for bankruptcy in the early hours of the morning on 15 May, with a USD 60m debtor-in-possession (DIP) financing facility, which rolls up USD 50m in prepetition term loan debt. By Taylor Harrison, Paul Gunther, Seth Crystall and Catherine Corey ![]()
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