The resolution (the “Plan Resolution”) approving the Plan pursuant to the CCAA was approved by 100% of the First Lien Lenders and 100% of the Company’s general unsecured creditors (the “General Creditors”) who were present and voted in person or by proxy on the Plan Resolution at the creditors’ meetings held on June 19, 2019, in accordance with the 2019 Creditors’ Meetings Order granted by the Court on May 16, 2019.
Following the positive vote at the creditors’ meetings, on July 16, 2019 the Court entered an order sanctioning Connacher’s Plan (the “2019 Plan Sanction Order”), which reflected certain voluntary amendments to address requests of the Court (the “Plan Amendments”). The Plan Amendments are not materially prejudicial to the interests of any of the creditors under the Plan.
The Company is now working towards satisfying conditions precedent to the Plan and consummating the Plan transaction. In connection with Connacher’s application for the sanction of the Plan, on June 27, 2019 the Court granted an order extending the Court-ordered stay of proceedings in respect of the Company under the CCAA until the earlier of (i) September 30, 2019; and (ii) subject to the Court sanctioning the Plan (which has now occurred), the filing of a certificate by the Court-appointed Monitor, Ernst & Young Inc., (the “Monitor”), confirming the implementation of the Plan.
The approval of the Plan by affected creditors and subsequent Court sanction of the Plan, are key steps towards the Company’s implementation of the Plan transaction and its emergence from protection under the CCAA. The Plan represents the best alternative for the long-term interests of Connacher and significantly reduces its existing funded debt, improves liquidity, and is beneficial to employees, customers, suppliers and the communities where Connacher operates.
As previously announced, in the event of a circumstance where the Plan cannot be implemented, the Company will proceed to seek Court approval of and, if such approval is granted, complete a pre-negotiated asset purchase transaction whereby the First Lien Agent, on behalf of the First Lien Lenders, will cause a new company to be formed to execute a purchase and sale and agreement and credit bid a portion of the first lien obligations for all or substantially all of the Company’s property and assets.
The above description is a summary only and is subject to the express terms of the orders and documents described herein. A copy of the 2019 Plan Sanction Order, the Plan, including the amended and restated Plan dated July 16, 2019, and all related CCAA materials can be found on the website maintained by the Monitor at www.ey.com/ca/connacheroilandgas and will be filed on the Company’s profile on www.sedar.com.
Connacher is a Calgary-based in situ oil sands developer, producer, and marketer of bitumen. The Company’s principal asset is a 100 per cent interest in the Company’s Great Divide oil sands leases near Fort McMurray, Alberta. The Company operates two steam-assisted gravity drainage facilities at these oil sands leases.