Extruder’s credit arrangements expanded (September 22, 2003)
Canadian PlasticsCanadian Plastics
Financially troubled pipe and profile manufacturer Imperial PlasTech, and its subsidiaries, obtained a further orde...
Financially troubled pipe and profile manufacturer Imperial PlasTech, and its subsidiaries, obtained a further order under the Companies’ Creditors Arrangement Act (CCAA) in connection with the credit protection status the company acquired this summer. The company received the Fifth Order, which provides for an extension of the period of the stay imposed under the CCAA to November 30, 2003, in order to carry out the continued restructuring of the PlasTech Group.
As part of the restructuring effort, The PlasTech Group, formerly based in Peterborough, ON, has negotiated favorable price and credit terms with their resin suppliers. In specific cases, the credit being provided to the PlasTech Group by resins suppliers is secured by a charge against the assets of the company and by a guarantee given by A.G. Petzetakis SA, a major shareholder of Imperial PlasTech. The Fifth Order approved an increase in the amount of the charge in favor of resin suppliers from Cdn$1.0 million to US$2.0 million. The Fifth Order also approved the agreement between the PlasTech Group and Chevron Phillips Chemical Company LP, settling ongoing litigation commenced by the parties prior to the CCAA proceedings. Imperial Pipe had filed a claim against Chevron Phillips for defective resin and Chevron Phillips had issued a claim against Imperial Pipe and Ameriplast Inc. (PlasTech subsidiaries) for unpaid resin supply. Under the terms of the agreement, Chevron Phillips has agreed to credit Imperial Pipe the amount of US$250,000 against US$1,737,338 owed to Chevron for unpaid resin.