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Uh Oh: BuildDirect files for Creditor Protection | Raises $15 Million US Financing to Fund Interim Operations ($4M Immediate)
Friday, November 3, 2017Company Profile | Follow Company
Vancouver, BC, November 3, 2017--(T-Net)--BuildDirect announced that it has voluntarily filed for relief from creditors under the Companies' Creditors Arrangement Act (CCAA), effective as of October 31st.
This comes just one day after the company's co-founder and former CEO Jeff Booth "abruptly" resigned earlier this week.
The company is reportedly evaluating a range of alternatives to either recapitalize the company (so that it can continue to transition from an e-commerce business to a platform business), or, to possibly sell the company, while it will continue to operate as a going concern while under creditor protection.
PricewaterhouseCoopers Inc. has now been appointed Monitor under the Companies' Creditors Arrangement Act (“CCAA”) of BuildDirect.com Technologies Inc. (known as “the Petitioner Entity”), by Order of the Supreme Court of British Columbia.
For any updates on the CCAA proceedings, please refer to The Monitor's website: www.pwc.com/ca/builddirect.
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Editor's Note: PWC has posted the following formal "Status Update" regarding BuildDirect on its website:
This page and information is for information purposes only and you should consult your professional adviser if you have any questions or are uncertain as to your rights or obligations.
On October 31, 2017, PricewaterhouseCoopers Inc. was appointed Monitor under the Companies' Creditors Arrangement Act (“CCAA”) of BuildDirect.com Technologies Inc. (known as “the Petitioner Entity”), by Order of the Supreme Court of British Columbia.
More information will be posted to this website, as soon as it becomes available.
On October 31, 2017 (the "Filing Date"), BuildDirect.com Technologies Inc. ("BuildDirect") sought and obtained an Initial Order pursuant to the CCAA.
BuildDirect's stated purpose for doing so was to facilitate either a recapitalization or a sale transaction as part of the CCAA proceedings, and to facilitate further financing that BuildDirect required.
In order to continue to fund BuildDirects' operations, BuildDirect negotiated a $15 million U.S. DIP Term Sheet (aka "Debtor in Possession" Term Sheet) with a syndicate of lenders who are signficant investors in BuildDirect.
The Court approved this Interim Financing which provides for an immediate advance of USD $4 million within 24 hours of approval of the DIP Term Sheet by the Court. BuildDirect's intention is to continue its operations during these CCAA proceedings while it works on its financial restructuring.
As is typical of Initial Orders pursuant to the CCAA, there are restrictions on BuildDirect's trading partners from terminating their arrangements with BuildDirect and on payments that BuildDirect can make with respect to obligations owing to BuildDirect's creditors on the Filing Date.
BuildDirect is however, expected to meet its payment obligations for goods and services provided following the Filing Date. The Interim Financing approved by the Court facilitates this.
Details regarding BuildDirect's background and financial position are contained within the initial application materials posted on this website as well as the Initial Order.
The Monitor prepared a pre-filing report to assist the Court during the application made by BuildDirect. This report is posted on this website.
The Monitor will post regular status updates to this website and post future Monitor reports and court materials, as they become available during these CCAA proceedings.
For any updates on the CCAA proceedings, please refer to The Monitor's website: www.pwc.com/ca/builddirect.
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About BuildDirect
BuildDirect is reinventing the home improvement industry with the first artificial intelligence (AI)-driven technology platform for heavyweight products. The BuildDirect platform includes two core business units:
The platform is powered by proprietary AI, machine learning, and predictive analytics that drives robust efficiencies for the innovation of heavyweight product services, distribution, and sales across buyers, sellers, shippers, and everyone in between.
BuildDirect is headquartered in Vancouver, British Columbia with warehouse locations across North America.
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