Troika Media management sees ‘substantial doubt’ to continue as going concern

The company states: “As has been previously reported, the Company agreed with its senior lender, Blue Torch, to undertake a process with an investment banker to facilitate the repayment of Blue Torch’s debt in full either through an acquisition or disposition involving the Company, a refinance of Blue Torch’s debt, or some combination thereof. As a result, the Company engaged Jefferies LLC, a leading global full-service investment banking and capital markets firm, in December 2022 and the Board formed a Special Committee to, among other things, oversee a Potential Transaction. To date, no agreement for a Potential Transaction has been reached, and the Company is pursuing a long-term amendment of the Financing Agreement with Blue Torch. The current waivers with Blue Torch expire on October 20, 2023, subject to potential extension if a definitive written agreement is delivered on or prior to October 20, 2023, providing for cash repayment in full of all obligations owed to Blue Torch or which is otherwise acceptable to Blue Torch. There can be no assurance that the Company will be able to execute a Potential Transaction or reach agreement with Blue Torch by such date. If necessary, the Company will request additional waivers and extensions of the expiration date of the waivers from Blue Torch, but there can be no assurance that Blue Torch will agree to any requested waivers or extensions. The Company is currently in negotiations to extend that date. The issues with the Company’s capital structure and the costs of the Blue Torch debt have materially impacted the liquidity of the Company and have negatively impacted the performance of the business given the Company’s limited ability to invest in the business and the material amounts of time management has spent on the restructuring process. Pursuant to current projections of the Company’s cash flow, the Company would fail to have enough cash to continue to fund operations for the next twelve months. Thus, management has concluded that there is substantial doubt that the Company will continue as a going concern.”