Orbite Technologies Inc.

Orbite Technologies Inc.

August 02, 2017 09:34 ET

Orbite Provides Corporate Update

MONTREAL, QUEBEC--(Marketwired - Aug. 2, 2017) - Orbite Technologies Inc. (NEX:ORT.H) ("Orbite" or the "Company") today announced that, further to its press release of July 27, 2017, the Superior Court of Québec (the "CCAA Court") granted a motion filed by the Company under the Companies' Creditors Arrangement Act ("CCAA") and issued an amended and restated order namely to (1) extend the stay of all proceedings from August 4, 2017 to October 31, 2017 and (2) approve the $6.8 million debtor-in-possession ("DIP") financing from the holders of Orbite's 7% Convertible Secured Debentures due September 28, 2018 (the "2015 ITC Debentures") and a related DIP super-priority charge over the Company's assets.

The terms and conditions of the DIP financing are set forth in a credit facility between the Company and Computershare Trust Company of Canada in its capacity as trustee for the holders of the 2015 ITC Debentures (the "Lender"). The terms and conditions namely provide for an interest rate of 9.25% payable on the first day of each month starting on September 1, 2017 and a termination date which shall occur on the earliest of a) February 23, 2018, b) the implementation of a plan of compromise or arrangement with respect to Orbite, c) the acceleration of the loan and the termination of the DIP financing upon the occurrence of an event of Default or d) upon refinancing of the DIP financing. A 1% commitment fee (or $68,000) is payable to the Lender upon closing as well as the payment by Orbite of the Lender's legal fees and other expenses (the "Fees").

The DIP financing will serve for working capital and other general corporate purposes as well as to pay fees and expenses related to Orbite's restructuring process, and is expected to close by August 4, 2017. The order provides for the release of the funds to Orbite as follows, a tranche of $4.6 million will be transferred to Orbite upon closing and the remaining $2.2 million minus the Fees will be held in trust by PricewaterhouseCoopers, in its capacity as court appointed Monitor, and will be released to Orbite upon approval of the CCAA Court.

According to the Company's cashflow projections filed with the CCAA Court, the $6.8 million funds to be received under the DIP financing should allow the Company to maintain its reduced operations until the week of February 22, 2018.

The Company will provide further updates as developments occur.

There can be no guarantees that Company will otherwise be successful in its restructuring efforts and will emerge from CCAA protection.

About Orbite

Orbite Technologies Inc. is a Canadian cleantech company whose innovative and proprietary processes are expected to produce alumina and other high-value products, such as rare earth and rare metal oxides, at one of the lowest costs in the industry, and in a sustainable fashion, using feedstocks that include aluminous clay, kaolin, nepheline, bauxite, red mud, fly ash as well as serpentine residues from chrysotile processing sites. Orbite is currently in the process of finalizing its first commercial high-purity alumina (HPA) production plant in Cap-Chat, Québec and has completed the basic engineering for a proposed smelter-grade alumina (SGA) production plant, which would use clay mined from its Grande-Vallée deposit. The Company's portfolio contains 15 intellectual property families, including 44 patents and 38 pending patent applications in 11 different countries and regions. The Company also operates a state of the art technology development center in Laval, Québec, where its technologies are developed and validated.

Forward-looking statements

Certain information contained in this document may include "forward-looking information". Without limiting the foregoing, the information and any forward-looking information include statements regarding projects, costs, objectives and future returns of the Company or hypotheses underlying these items. In this document, words such as "may"," confident", "would", "could", "will", "likely", "believe", "expect", "anticipate", "intend", "plan", "estimate" and similar words and the negative form thereof are used to identify forward-looking statements. Forward-looking statements should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether, or the times at or by which, such future performance will be achieved. Forward-looking statements and information are based on information available at the time and/or the Company management's good-faith beliefs with respect to future events and are subject to known or unknown risks, uncertainties, assumptions and other unpredictable factors, many of which are beyond the Company's control. Risks, uncertainties and other factors that could affect anticipated results and future events also include, but are not limited to, those described in the section of the Management's Discussion and Analysis (MD&A) entitled "Risk and Uncertainties" as filed on July 28, 2017 on SEDAR, including those under the headings "Going Concerns", Commercial Operation of HPA Plant", "We will need to raise capital to continue our growth" and "Development Goals and Time Frames" described in the MD&A filed on March 31, 2017.

The Company does not intend, nor does it undertake, any obligation to update or revise any forward-looking information or statements contained in this document to reflect subsequent information, events or circumstances or otherwise, except as required by applicable laws.

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