File voluntary Chapter 11 petitions to implement restructuring; The proposed reorganization plan creates an efficient path to resume account access and return value to customers
Voyager has approximately $1.3 billion in crypto assets on the platform, more than $350 million in cash held in the customer FBO account at Metropolitan Commercial Bank, and claims against Three Arrows’ equity of over $650 million1
NEW YORK , July 5, 2022 /PRNewswire/ — Voyager Digital Ltd . (“Voyager” or the “Company”) (TSX: VOYG) (OTCQX: VYGVF) (FRA: UCD2), today announced that it has commenced a voluntary Chapter 11 process to maximize value for all stakeholders. As part of this process, the Company and its principal operating subsidiaries filed voluntary Chapter 11 reorganization petitions in the United States Bankruptcy Court for the Southern District of New York (the “Court”). The Company intends to seek recognition of Voyager’s Chapter 11 case in the Superior Court of Ontario (Commercial List) under the Companies Creditors Arrangement Act.
“This comprehensive reorganization is the best way to protect the platform’s assets and increase value for all stakeholders, including customers,” said Steven Ehrlich, Voyager’s CEO. “Voyager’s platform was created to empower investors by providing access to crypto asset trading with simplicity, speed, liquidity and transparency. While I strongly believe in this future, the continued volatility and contagion of the crypto markets over the past few months and Three Arrows Capital’s (“3AC”) default on a loan by the company’s subsidiary, Voyager Digital, LLC, require us to take thoughtful and decisive action now. The Chapter 11 process provides an efficient and fair mechanism for maximizing recovery.”
The Proposed Plan of Reorganization (“Plan”) will resume account access and return value to customers upon completion. Under this plan, which is subject to change in light of ongoing discussions with other parties and requires court approval, customers with cryptocurrency in their accounts will receive in return a combination of the cryptocurrency in their accounts, proceeds from the 3AC recovery, common stock in the newly reorganized company and Voyager tokens . The plan allows customers to choose the ratio of common equity and crypto they will receive, subject to certain maximum thresholds.
Customers with USD deposits in their account(s) will be able to access those funds after completing the reconciliation and fraud prevention process with Metropolitan Commercial Bank.
The Company continues to evaluate all strategic alternatives to maximize value for stakeholders.
The company has over $110 million in cash and owned crypto assets that will provide liquidity to support day-to-day operations during the Chapter 11 process, in addition to more than $350 million in cash held for the benefit of customers (FBOs). account at Metropolitan Commercial Bank. Voyager also has approximately $1.3 billion in crypto assets on its platform, plus claims against Three Arrows Capital (“3AC”) for more than $650 million.
Voyager previously announced that its subsidiary, Voyager Digital LLC, had issued a notice of default to 3AC for failing to make the required payments on its previously disclosed 15,250 BTC and $350 million USDC loan. Voyager is actively pursuing all available means of recovery from 3AC, including through the court-supervised processes of the British Virgin Islands and New York.
The company also announced the appointment of four new independent directors: Matthew Ray at Voyager Digital Ltd.; Scott Vogel of Voyager Digital Holdings, Inc.; and Jill Frizley and Timothy Paul of Voyager Digital LLC. Information about their background and relevant experience is included at the end of this publication.
As part of the reorganization process, the Company will file customary “Day One” offerings in order to maintain operations in its ordinary course. Voyager intends to pay its employees in the usual manner and to continue their basic benefits and certain customer programs without interruption. The Company expects to receive court approval for all of these routine requests. Trading, deposits, withdrawals and loyalty rewards on the Voyager platform remain temporarily suspended.
Parties with questions about the Chapter 11 process may contact the Company’s claims agent, Stretto, at +1 (855) 473-8665 (toll free in the US) or +1 (949) 271-6507 (for non-US countries) . They also created a website that includes court documents and other information.
To carry out the restructuring process, the Company has engaged Moelis & Company and The Consello Group as financial advisors, Kirkland & Ellis LLP as legal advisors and Berkeley Research Group, LLC, as restructuring advisor.
New independent directors to provide additional leadership and expertise
Matthew Ray joins as an independent director of Voyager Digital Ltd. Mr. Ray is the founder and managing partner of Portage Point Partners, where he served as Chief Restructuring Officer (CRO), Chief Executive Officer (CEO), Chairman, Lead Independent Director, Special Chairman of the Restructuring Committee and Strategic Advisor to the wide-ranging transformations and restructurings for both private and public companies.
Scott Vogel joins as an independent director of Voyager Digital Holdings, Inc. Mr. Vogel has extensive experience on numerous boards of directors of financially distressed companies in a diverse range of industries. Mr. Vogel carefully and skillfully manages complex situations, develops restructuring plans and post-restructuring organizational priorities, builds consensus among and between stakeholders and management, executes complex capital market and corporate transactions, facilitates clear lines of communication and aligns the incentives of management to ensure accountability.
Jill Frisley joins as an independent director of Voyager Digital LLC. Ms. Frizzley is a corporate governance expert with significant experience as a member of boards of directors and advises on corporate governance, restructuring, bankruptcy and mergers and acquisitions. Drawing on two decades of legal practice in financial restructuring and insolvency, Ms. Frizzley has a deep wealth of knowledge covering corporate, financial and governance matters across a wide range of industries.
Timothy Paul joins as an independent director of Voyager Digital LLC. Mr. Paul has extensive experience and expertise in all aspects of corporate restructuring and financing, mergers and acquisitions, valuation, valuation and analysis of liquidity and balance sheet, capital markets, corporate law, restructuring law and litigation. Mr. Paul currently serves as a senior advisor in a number of situations as well as as an independent director for a number of corporations. Mr. Paul has also consulted in a wide range of industries and provided expert testimony on valuation and corporate and restructuring matters.
About Voyager Digital Ltd.
Subsidiary of Voyager Digital Ltd. (TSX: VOYG) (OTCQX: VYGVF) (FRA: UCD2) in the US, Voyager Digital, LLC, is a United States cryptocurrency platform founded in 2018 to bring choice, transparency and cost efficiency to the market. Voyager offers a secure way to trade over 100 different crypto assets using its easy-to-use mobile app. Through its subsidiary Coinify ApS, Voyager provides crypto payment solutions for both consumers and merchants worldwide. To learn more about the company, please visit https://www.investvoyager.com.
Forward-looking statements
Certain information in this press release, including, but not limited to, statements regarding the restructuring process, the restructuring plan, available recovery funds from 3AC, planned filings as part of the restructuring process, resumption of account access, return of value of customers, Voyager’s ability to continue as a going concern, exploration of strategic alternatives, discussions with third parties regarding strategic alternatives and the results of those discussions, the temporary nature of the platform shutdown, future growth and business performance, exploration of strategic alternatives, future adoption of digital assets, anticipated trends and challenges in our business and industry, regulation of the supply of digital assets, the impact of 3AC’s default on the Company, the Company’s liquidity and ability to satisfy customer orders and withdrawals, and K’s expected results ompanies may constitute forward-looking information (collectively, forward-looking statements), which may be identified by the use of terms such as “may,” “will,” “should,” “expect,” “anticipate,” “project,” ” appreciate,” “intend,” “continue,” or “believe” (or the negatives), or other such variations. Forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause Voyager’s actual results, performance or achievements to be materially different from any of its future results, performance or achievements, expressed or implied of forward-looking statements. In addition, we operate in a very competitive and rapidly changing environment. New risks arise from time to time. It is not possible for our management to anticipate all risks, nor can we estimate the impact of all factors on our business or the extent to which any factor or combination of factors could cause actual results to differ materially from those contained in any forward – looking statements we can make. In light of these risks, uncertainties and assumptions, the future events and trends discussed in this press release may not occur and actual results may differ materially and adversely from those anticipated or implied by the forward-looking statements. Not sure the timing or results of…
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