Loan & DebtJun 10, 2026, 11:47 AM
Pacific Oak Subsidiary Debt Arrangement Approved by Israeli Court
AI Summary
Pacific Oak Strategic Opportunity REIT, Inc. announced that an Israeli court approved a debt arrangement for its indirect wholly-owned subsidiary, Pacific Oak SOR (BVI) Holdings, Ltd., on June 5, 2026. This arrangement restructures the maturity, interest rate, security, and enforcement terms for the BVI's Series B and Series D bonds, with a final maturity date of June 30, 2028. The bonds will bear interest at 11.5% annually from the Completion Date, and the BVI will be subject to significant covenants, operational limitations, and a minimum liquidity reserve requirement.
Key Highlights
- Tel Aviv–Jaffa District Court approved a debt arrangement for Pacific Oak SOR (BVI) Holdings, Ltd. on June 5, 2026.
- The arrangement restructures Series B and Series D bonds, with principal amounts of NIS 388,237,587 and NIS 587,063,000 respectively.
- Principal and interest repayment is due in one payment on June 30, 2028 (Final Maturity Date).
- Bonds bear interest at 11.0% annually until the Completion Date, then 11.5% annually thereafter.
- Creditors are entitled to an additional payment equal to the lesser of 1.5% incremental interest or 50% of BVI's residual asset value.
- Requires creation of first-priority security interests over substantially all unencumbered BVI assets within 105 days of Completion Date.
- BVI must maintain a minimum liquidity reserve of $6.0 million (not less than $2.0 million).
- Annual caps on BVI's G&A expenses: $5.0 million for 2026, $4.0 million for 2027, and $3.0 million for 2028.
Price Impact
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