Nortel Networks Corporation has announced that it, Nortel Networks Limited and the other Canadian subsidiaries that filed for creditor protection under the companies’ Creditors Arrangement Act, or CCAA, have obtained an order from the Ontario Superior Court of Justice further extending, to July 30, 2009, the stay of proceedings that was previously granted by the Canadian court.
The purpose of the stay of proceedings is to allow the Nortel companies to continue to develop a restructuring strategy for consideration by their creditors and the Canadian court and file a plan of arrangement.
Nortel also announced that it has entered into a further amendment to its agreement with Export Development Canada (EDC), initially announced on January 14, 2009, to permit continued access by Nortel Networks Limited (NNL) to its EDC performance-related support facility up to July 30, 2009 for up to a maximum of $30m of support.
The amendment also clarifies that going forward, the charge over certain of Nortel’s assets in favor of EDC will only extend to new support provided after January 14, 2009 and rollovers or extensions of pre-existing support made before April 14, 2009. The amendment and extension of the support facility has been approved by the Canadian court.