CALGARY, May 17, 2016 /CNW/ – Connacher Oil and Gas Limited (CLC – TSX; “Connacher” or the “Company”) announced today that the Company has obtained court protection under the Companies’ Creditors Arrangement Act (“CCAA”) pursuant to an initial order granted by the Court of Queen’s Bench, in the Province of Alberta, on May 17, 2016 (“Initial Order”). Pursuant to the Initial Order, the Company has obtained protection from its creditors under the CCAA for a period expiring June 16, 2016, as the Company attempts to restructure and reorganize its assets, business and financial affairs, subject to possible extension from time to time pursuant to further court order.
During the CCAA proceedings, it is expected that the Company’s operations will continue uninterrupted in the ordinary course of business and that every day obligations to employees, key suppliers of goods and services and the Company’s customers will, after the filing date, continue to be met on an ongoing basis. While under CCAA protection, management of the Company will remain responsible for the day-to-day operations of the Company under the general oversight of the Monitor. At this time, there are no intended changes to the management team or the composition of the Board of Directors of the Company and the Company anticipates that such individuals will continue in their respective roles throughout the CCAA process.
To enable the Company to maintain normal business operations, the Initial Order provides a stay of certain creditor claims and the exercise of contractual rights arising out of the CCAA process.
Subject to execution of definitive documents, the Company has received commitments from certain of its existing lenders for up to US$20 million in interim financing, subject to certain terms and conditions (including initial draws up to US$11.5 million), to support its continued operations, which interim financing was approved by the Court in the Initial Order. The interim financing is expected to provide sufficient liquidity to support the business of the Applicants during the CCAA proceedings.
Pursuant to the Initial Order, the Company also obtained approval to initiate a sale and investment solicitation process to be conducted in conjunction with the CCAA proceedings, intended to generate interest in the business and/or the assets of the Company, with the goal of maximizing value for all stakeholders of the Company.
Ernst & Young Inc. has been appointed Monitor of the Company for the CCAA proceedings. A copy of the CCAA Initial Order will be made available and details relating to this case may be accessed on the Monitor’s website at www.ey.com/ca/connacheroilandgas. The Monitor has also established the following information hotline related to enquiries regarding the CCAA process, at 403-206-5650.
On May 16, 2016, the TSX suspended trading of Connacher’s common shares and has commenced an expedited review with respect to whether Connacher continues to meet the requirements for continued listing. There is no certainty as to timing or likelihood that the common shares will recommence trading on the TSX or any other exchange or market.
Further news releases will be provided on an ongoing basis throughout the CCAA process as may be determined necessary.