ORAGIN Foods Inc. (TSX-V:OG, OTCQX:OGGFF) said it continues to seek ways to repay its outstanding unsecured convertible debentures.
Despite the resignation of four independent directors on its board, the Toronto-based food innovation company assured shareholders that its retail business and CPG division continue to operate without interruption.
The four resignations came from Ken Villazor, Keith Stein, Micheal Lovsin, and Kevin Williams, who had formed a special board committee evaluating strategic options to repay the unsecured debentures.
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On October 28, ORAGIN said it had received notices of default from the holders of the unsecured debentures issued on October 25, 2019, which matured on October 25, 2022.
Initially, through the management and then through the efforts of the special committee, ORAGIN said it continued to engage in discussions with the holders with the objective of coming to mutually beneficial terms for the repayment of the debt. However, despite these efforts, the company said it has been unable to do so on terms that are mutually agreeable and, in the best interests of the company and its shareholders.
ORAGIN said it might continue discussions with the holders if the company believes that mutually agreeable terms are feasible.
The company said that it believes the independent directors tendered their resignations, despite continued efforts to reach a resolution with the holders up until the date of such resignations, as a result of the inability of the company to continue to maintain full Directors and Officers indemnity insurance coverage for its board of directors and management.
ORAGIN CEO Matt Lurie remains the company’s sole director.
“I would like to thank the board for their efforts in trying to arrive at an agreement with the unsecured debenture holders. It is unfortunate that the set of events that has transpired has led us to this current situation however I am committed to working towards remedying the issues outstanding. The company’s retail and CPG Divisions continue to function as normal and the company has sufficient cash on hand to carry on with its operations,” Lurie said in a statement.
As the policies of the TSX Venture Exchange require that there be a minimum of three directors on the board of directors of a reporting issuer, the company said it anticipates that the Exchange will suspend the company’s listing in the coming days until and unless the company can fill the vacancies and return to compliance.
The remaining director intends to appoint the two additional directors, and continue to evaluate the strategic options with a view to repaying the unsecured debentures, improving or removing the limitations pursuant to the D&O Insurance, and undertaking such actions as are required to bring the company into compliance with the policies of the TSX Venture Exchange, according to ORAGIN.
Contact the author at susie@proactiveinvestors.com