Invesque asks holders to amend 8.75% convertibles, reduce redemption amount

By Wendy Van Sickle

Columbus, Ohio, Aug. 17 – Invesque Inc. will host a meeting for holders of its 8.75% convertible debentures due Sept. 30, 2023 to vote on a number of changes to the convertibles, including reducing the principal amount to be redeemed, according to a news release on Thursday.

Under the indenture dated Aug. 24, 2018, the issuer is required to redeem $22 million of the principal amount outstanding plus accrued interest on Sept. 30, but Invesque is restricted under an amendment entered with its primary credit facility lender from redeeming more than $4,828,000 of the convertibles.

Therefore, Invesque is asking holders to approve reducing the amount redeemed on Sept. 30 to $4,828,000 plus interest, as well as decreasing the conversion price to $1.10 from $2.75 a share.

Invesque is also asking holders to approve adding a covenant the Invesque will not make any cash repayment or redemption of principal on its outstanding 7% convertible subordinated debentures due Jan. 31, 2025 whether before, on or after the maturity date of the 7% debentures unless, prior to or contemporaneously with the repayment or redemption of 7% debentures, it redeems or repays for cash an equal principal amount of the 8.75% debentures; and adding a covenant that it shall not issue a new class or series of unsecured convertible debentures unless the maturity date for those debentures is at least 18 months after Sept. 30, 2026 or senior notes in exchange for, or to fund the cash repayment of, all or a portion of the 7% debentures.

If the amendments are approved, the effective date will be the date that Invesque enters into a second supplemental trust indenture effecting the amendments.

Debentureholders holding approximately 33% of the outstanding debentures have either signed voting support agreements or provided written undertakings to vote for the amendments, according to the release.

For the amendments be to passed, at least two-thirds of the principal amount of the debentures voted, either in person at the meeting or by proxy, must be voted in favor of the amendments. Alternatively, the amendments will be approved without the need for a meeting if the form of proxy or voting instruction form accompanying the circular is executed in writing by holders of at least two-thirds of the principal amount of the debentures who mark the “for” box prior to the meeting.

The record date for holders to receive notice and vote at the meeting is Aug. 21 and the meeting will be held on Sept. 26 at 10 a.m. ET.

The issuer is a Toronto-based health care real estate company.

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