Great Western Minerals Group Ltd.

CCAA Filing

Page last updated: February 1, 2016

This page is for information purposes only and you should consult your professional adviser if you have any questions or are uncertain as to your rights or obligations.


On April 30, 2015, Great Western Minerals Group Ltd. (“GWMG” or the “Applicant”) applied for and received an order (the “Initial Order”) for protection pursuant to the Companies’ Creditors Arrangement Act (“CCAA”), R.S.C.1985, c.C-36 from the Ontario Superior Court of Justice Commercial List (the “Court”), which includes, among other things, a stay of proceedings against GWMG, and the appointment of PricewaterhouseCoopers Inc. as monitor of the Applicant (“PwC” or the “Monitor”).

The Initial Order permitted GWMG, among other things, to continue to carry on business in a manner consistent with the preservation of its business and property and shall be entitled, but not required, to continue to fund the working capital requirements of its direct and indirect subsidiaries from and after the date of the CCAA provided that such amounts are included in the cash flow forecast as may be amended with the prior written consent of the Monitor and the Ad Hoc Committee.

The Initial Order, also, among other things:

  1. authorized the Applicant to take all steps and actions in respect of and to comply with all of its obligations pursuant to the Support Agreement dated April 29, 2015 between the Applicant and certain holders and/or investment managers for one or more holders of the US $90,000,000 principal 8% secured convertible bonds due 2017 (the “Support Agreement”);
  2. approved the sale and investment solicitation process (the “SISP”) attached as Schedule A to the Initial Order;
  3. granted a stay of proceedings until May 29, 2015, or such later date as the court may order (the “Stay Period”);
  4. granted a priority charge on the Property of the Applicant, in the amount of $750,000, to secure the fees and disbursements of the Monitor, counsel to the Monitor, the Applicant’s domestic and foreign counsel, counsel for the directors of the Applicant, domestic and foreign counsel to the Ad Hoc committee, and Houlihan Lokey (the “Administration Charge”);
  5. approved the key employee retention payments (the “KERPs”) offered by the Applicant to its remaining employees and executive officer, as set out and described in the LeVier Affidavit;
  6. granted a priority charge on the Property of the Applicant, in the amount of $195,695, as security for the Applicant’s obligations in respect of the KERPs (the “KERP Charge”);
  7. granted a priority charge over the Property of the Applicant, in the amount of $200,000, in order to protect the Applicant’s directors and officers from certain potential liabilities that they may incur as directors or offices after the commencement of the CCAA proceedings (the “Directors’ Charge”);
  8. authorized the Applicant to carry out its obligations to the financial advisor to the Ad Hoc Committee, Houlihan Lokey Capital, Inc. (“Houlihan Lokey”) under the Houlihan Lokey Fees Letter (as defined in the LeVier Affidavit);
  9. granted a priority charge on the Property of the Applicant, in the amount of $300,000, as security for the transaction fees that may become payable to Houlihan Lokey in accordance with the terms of the Houlihan Lokey Fees Letter (the “Houlihan Lokey Transaction Fee Charge”); and
  10. approved and adopted the E-Service Protocol of the Commercial List to these CCAA proceedings.

A copy of the Initial Order is posted under the Orders tab.

In accordance with section 23 (1)(a) of the CCAA and the Initial Order, a notice was sent to all creditors who have a claim against the Applicant of more than $1,000 on May 5, 2015.

Notice to Creditors
List of Creditors

Status of File as of February 1, 2016

On January 29, 2016, the Court issued an order that:

  1. authorized the Monitor to reserve from the available cash $252,849 (the “Costs of Completion Amount”) to pay the accrued and future fees and expenses of the Monitor, Davies, and counsel to the Ad Hoc Committee to complete the CCCAA and Bankruptcy Proceedings, and to pay any costs that may become payable to VKLPC in respect of the motion brought by VKLPC on January 28, 2016;
  2. authorized the Monitor to reserve from the available cash $15,000 on account of the Trade Creditor Reserve (and, together with the Costs of Completion Amount, the “Monitor’s Holdback Amount”). Any amounts that become payable to the Company on account of GST shall be added to the Monitor’s Holdback Amount;
  3. authorized the Monitor to pay, within five business days, $173,713 to the Bondholder Trustee or to such other party as the Bondholder Trustee may designate by written notice to the Monitor;
  4. approved the fees and disbursements of the Monitor for the period of November 15, 2015 to January 15, 2016;
  5. approved the fees and disbursements of Davies for the period of November 1, 2015 to January 25, 2016;
  6. approved the fee accrual for fees and disbursements incurred or to be incurred by the Monitor and Davies through to completion, as well as the fees and disbursements accrued or to be incurred by counsel to the Ad HOC Committee, be paid in full from the Costs of Completion Amount;
  7. ordered that the unused portion of the Monitor’s Holdback Amount following the completion of CCAA Proceedings and the Bankruptcy Proceedings, if any, be paid to the Bondholder Trustee, or to such other party as the Bondholder Trustee may designate;
  8. approved the Eleventh Report and the activities of the Monitor; and
  9. upon the filing of the Monitor’s Certificate, the CCAA proceedings will be terminated and the Monitor will be duly and properly discharged.

Status of File as of January 27, 2016

On January 27, 2016, the Monitor filed its Eleventh Report with the Court to provide the Court with information in respect of:

  1. the bankruptcy of the Company;
  2. the results of the SISP;
  3. the Monitor’s activities since the date of the Tenth Report;
  4. the outcome of the motion brought by VKLPC and subsequent communications with VKLPC;

and to recommend that the Court grant an order:

  1. approving the Company’s Statement of Cash Receipts and Cash Disbursements;
  2. authorizing the Monitor to hold back the Monitor’s Holdback Amount (as defined in the Monitor’s Eleventh Report);
  3. approving the Bondholder Distribution (as defined in the Monitor’s Eleventh Report);
  4. approving the Eleventh Report and the Monitor’s activities set out therein; and
  5. approving the discharge of the Monitor and terminating the proceedings under the CCAA following the filing of a certificate certifying that the Monitor has complete the remaining duties (as defined in the Monitor’s Eleventh Report).

A motion will be heard on January 29, 2016.

Status of File as of December 4, 2015

On December 3, 2015, the Monitor issued a press release announcing that it has filed an assignment in bankruptcy under the BIA on behalf of the Company. A copy of the press release has been posted under the Press Release section.

Status of File as of November 30, 2015

On November 30, 2015 the Court issued an order:

  1. extending the Stay Period to January 29, 2016;
  2. authorizing the Monitor to file an assignment into bankruptcy on behalf of the Applicant;
  3. approving the fees and disbursements of the Monitor and its legal counsel as detailed in the Monitor’s Tenth Report; and
  4. approving the Ninth and Tenth Reports of the Monitor and the Monitor’s activities as detailed therein.

Status of File as of November 25, 2015

On November 24, 2015, the Monitor filed its Tenth Report (“Tenth Report”) to Court to provide the Court with information in respect of:

  1. the Company’s operations and R&D;
  2. the Monitor’s activities since the date of the Eighth Report;
  3. the outcome of the motion brought by Vernon Kiss Legal Professional Corporation (“VKLPC”) and subsequent communications with VKLPC;
  4. the stats of the Company’s SISP; and

to recommend that the Court approve the Monitor’s motion seeking an order of the Court:

  1. extending the Stay Period (as defined in the Initial Order) to and including January 29, 2016;
  2. authorizing the Monitor to file an assignment in bankruptcy on behalf and in the name of the Company;
  3. approving the fees and disbursements of the Monitor and its legal counsel; and
  4. approving the Ninth Report, the Tenth Report and the Monitor’s activities as set out in the Ninth Report and the Tenth Report.

A motion will be heard on November 30, 2015.

Status of File as of November 12, 2015

On November 12, 2015, the Monitor, of GWMG issued a press release on behalf of the Company, to provide an update of the previously announced SISP being implemented under the CCAA in respect to GWMG. The Monitor has the authority to, among other things, act on behalf of GWMG to pursue the ongoing SISP and complete any related transactions. Full particulars of the update can be found in the press release, a copy of which has been posted under the “Press Release” tab.

Status of File as of November 3, 2015

On October 3, 2015, the Court dismissed the motion to lift the stay of proceedings brought by Vernon Kiss Legal Professional Corporation.

Status of File as of November 2, 2015

On October 30, 2015, the Monitor filed its ninth report (the “Ninth Report”) to provide the Court with information in respect of the motion to lift the stay of proceedings brought by Vernon Kiss Legal Professional Corporation and to recommend that the court dismiss the motion.

Status of File as of October 30, 2015

On October 29, 2015, the Court issued an order:

  1. approving the Transaction with the LCM Purchasers and vesting GWMG’s right, title and interest in and to the Sale Assets free and clear of all claims and encumbrances in the LCM Purchasers and or their nominee (all as defined in the Eighth Report);
  2. directing that all proceeds from the sale to LCM Purchasers be paid to the Monitor and be held in trust and directing the Monitor to pay the Second Bondholder Distribution amounts set forth in the Distribution Analysis to the Trustee, or to such other party as the Trustee may designate;
  3. authorizing the Monitor on behalf of the Company to provide a written direction to any person holding any documents or property constituting the Sale Assets to deliver such documents or property to the Monitor or such other Person as the Monitor may direct;
  4. ordering that pending closing of the Transaction the Bid Summary, the unredacted Offer and the Distribution Analysis be sealed, kept confidential and not form part of the public record;
  5. approving the fees and disbursements of the Monitor and its legal counsel to September 30, 2015; and
  6. approving the Seventh and Eighth Reports of the Monitor and the activities of the Monitor as set out in the Seventh and Eight Reports;

Status of File as of October 26, 2015

On October 23, 2015, the Monitor filed its eighth report (“Eighth Report”) to provide the Court with information in respect of:

  1. the Monitor’s activities since the date of the Seventh Report;
  2. the status of the Company’s SISP including the termination of the LCMG Limited (U.K.) offer between GWMG and Douglas Trust; and
  3. the Company’s ongoing negotiations with certain bidders for the Company’s business and/or property;

    and to recommend that the Court approve the Monitor’s motion seek an order of the Court:

  4. approving the transaction (the “Transaction”) contemplated by the offer to purchase the sale assets (the “Sale Assets”) between GWMG and Everett International FZCO and Australasian Minerals and Trading (S) Pte Ltd (the “LCM Purchasers”) accepted by the Monitor on behalf of GWMG on October 20, 2015 (subject to Court approval);
  5. upon the closing of the Transaction, vesting GWMG’s right, title and interest, if any, in and to the Sale Assets, in the LCM Purchasers free and clear of all claims and encumbrances;
  6. directing, at the direction of the Monitor, the Trustee and all other persons (as defined in the Initial Order) to:
    1. deliver to the Monitor, or such other person as the Monitor may direct, all documents or property constituting Sale Assets in their possession or control; and
    2. take such other action as reasonably required by the Monitor to consummate the Transaction;
  7. sealing the unredacted Bid Summary, the unredacted Offer and the Distribution Analysis until the Monitor files with the Court the Monitor’s Certificate as contemplated by the Approval and Vesting Order (all as defined in the Eighth Report);
  8. approving an interim distribution (the “Second Bondholder distribution”) to the Trustee or such other party as the Trustee may designate on behalf of the holders of the Bonds (as devined in the Eighth Report) from the proceeds of the Sale Transaction;
  9. approving the fees and disbursements of the Monitor and its legal counsel;
  10. approving the Seventh Report and the Monitor’s activities; and
  11. approving the Eighth Report and the Monitor’s activities.

A motion will be heard on October 29, 2015.

Status of File as of August 21, 2015

On August 20, 2015, the Court issued an order:

  1. approving the Transaction with Douglas Trust Reg. and the execution of the Offer by the Monitor on behalf of the Company;
  2. vesting all GWMG’s right, title and interest in the Sale Assets (as defined in the Offer) to the Purchaser free and clear of all claims and encumbrances;
  3. that any and all proceeds paid by the Purchaser be paid to the Monitor and held subject to the terms of the order and to be released only upon order of the Court on notice to the Service List;
  4. that, pending closing of the Transaction, the bid summary and the unredacted Offer, be sealed, kept confidential and not form part of the public record;
  5. that the Stay Period and the Outside Date be extended to and including November 30, 2015; and
  6. approving the Reports and the activities of the Monitor as set out in the Seventh Report.

Status of File as of August 18, 2015

On August 17, 2015, the Monitor filed its Seventh Report to provide the Court with information in respect of:

  1. the Monitor’s activities since the date of the Sixth Report;
  2. the status of the Company’s SISP; and
  3. the Company’s ongoing negotiations with certain bidders for the Company’s business and/or property;

    and to recommend that the Court approve the Monitor’s motion seeking an order of the Court (the “Approval and Vesting Order”):

  4. approving the transaction (the “Transaction”) contemplated by the offer (the “Offer”) to purchase the Sale Assets (as defined in the Seventh Report) entered into (subject to Court approval) between GWMG and Douglas Trust;
  5. upon closing the Transaction, vesting GWMG’s right, title and interest, if any, in and to the Sale Assets, in the Purchaser free and clear of all claims and encumbrances;
  6. sealing the unredacted Bid Summary (as defined in the Seventh Report) and the unredacted Offer until the Monitor files with the Court the Monitor’s certificate as contemplated by the Approval and Vesting Order; and
  7. extending the Stay Period and the Outside Date of the SISP until and including November 30, 2015.

A motion will be heard on August 20, 2015.

Status of File as of August 4, 2015

On August 4, 2015, the Court issued an Order:

  1. authorizing the Monitor to pay the Bondholder distribution, in the amount of CDN $1.973,534 to Wilmington Trust (London) Limited;
  2. discharging the Houlihan Lokey Transaction Fee Charge (as defined in the Monitor’s Sixth Report);
  3. approving the Fifth and Sixth Reports of the Monitor and the activities of the Monitor as set out in the reports; and
  4. approving the fees and disbursements of the Monitor and that of its legal counsel for the period from April 24, 2015 to July 10, 2015.
  5. Status of File as of July 29, 2015

    On July 28, 2015, the Monitor filed its Sixth Report to provide the Court with information in respect of:

    1. the Monitor’s activities since the date of the Fifth Report;
    2. the status of the Company’s SISP; and
    3. the Company’s ongoing negotiations for the sale of remaining assets;

      and is filed in support of the Monitor’s request for an order:

    4. approving the Bondholder Distribution as described in the Sixth Report;
    5. approving the fees and disbursements of the Monitor and its legal counsel;
    6. eliminating the Houlihan Lokey Transaction Fee Charge;
    7. approving the Fifth Report and the Monitor’s activities as defined in the Fifth Report; and
    8. approving the Sixth Report and the Monitor’s activities as defined in the Sixth Report.

    A motion will be heard on August 4, 2015.

    Status of File as of July 24, 2015

    On July 24, 2015, the Court issued an Order:

    1. extending the Stay Period (as defined in the Initial Order dated April 30, 2015) and the Outside Date (as defined in the SISP) to and including August 31, 2015; and
    2. approving the Fourth Report of the Monitor and the activities of the Monitor as set out in the Fourth Report.

    Status of File as of July 21, 2015

    On July 21, 2015, the Monitor filed its Fifth Report to provide the Court with information in respect of:

    1. the Monitor’s activities since the date of the Fourth Report;
    2. the status of the Company’s sale and investment solicitation process (the “SISP”); and
    3. the Company’s ongoing negotiations with certain Bidders;

      and in support of the Monitor’s request for an order;

    4. extending the Stay Period and the Outside Date (as defined in the SISP) to and including August 31, 2015; and
    5. approving the Fourth Report and the Monitor’s activities set out therein.

    A motion will be heard on July 24, 2015.

    Status of File as of July 13, 2015

    On July 13, 2015, the Court issued an Order, which among other things:

    1. approving the Transaction and sealing the Offer;
    2. extending the Stay Period to July 27, 2015; and
    3. approving the Second Report and Third Report of the Monitor and the Monitor’s activities as set out in the reports.

    Status of File as of July 10, 2015

    On July 10, 2015, the Monitor filed a motion for an order, among other things:

    1. approving the transaction (the “Transaction”) contemplated by the offer of purchase (the “Offer”) entered into between GWMG and Douglas Trust Reg. (the “Purchaser”);
    2. upon closing of the Transaction vesting GWMG’s right, title and interest in the Sale Assets (as defined in the Fourth Report) in the Purchaser free and clear of all claims and encumbrances;
    3. sealing the unredacted Bid Summary (as defined in the Fourth Report) and Offer until the Monitor files with the Court the Monitor’s Certificate (also as defined in the Fourth Report);
    4. extending the Stay Period to July 27, 2015; and
    5. approving the Second Report of the Monitor dated June 24, 2015 and the Third Report of the Monitor dated July 2, 2015 and the activities of the Monitor as set out in the reports.

    The motion will be heard on July 13, 2015.

    Status of File as of July 3, 2015

    On July 3, 2015, the Court issued an Order, which, among other things:

    1. expanded the powers of Monitor in the CCAA proceedings, in accordance with the application made by the Ad Hoc Committee; and
    2. extended the Stay period to July 13, 2015.

    Status of File as of July 2, 2015

    On July 2, 2015 the Ad Hoc Committee of Convertible Bondholders (the “Ad Hoc Committee”) filed a motion for an order expanding the powers of the Monitor in the Applicants’ CCAA proceedings and extending the Stay Period to July 13, 2015.

    Also on July 2, 2015, the Monitor filed its Third Report to the Court to provide the Court with information in respect of:

    1. the Company’s operations since the date of the Second Report;
    2. the status of the Company’s SISP; and
    3. the Company’s ongoing negotiations with certain bidders

      and to provide the Court with the Monitor’s views in respect of:

    4. the Ad Hoc Committee’s request to extend the power and duties of the Monitor; and
    5. the Ad Hoc Committee’s request to extent the Stay Period to July 13, 2015.

    Status of File as of June 26, 2015

    On June 25, 2015, the Court issued an order extending the Stay Period to July 6, 2015. The Hoidas Lake Sale Agreement was adjourned to be dealt with at the next court attendance on July 3, 2015.

    Status of File as of June 25, 2015

    On June 24, 2015, the Monitor filed its Second Report to Court to provide the court with information in respect of:

    1. the Company’s operations since the date of the Initial Order;
    2. the Company’s sale and investment solicitation process and the milestones achieved to date;
    3. the Company’s ongoing negotiations with certain bidders;

      and to provide the court with the Monitor’s views in respect of:

    4. the Third Cash flow Forecast (as defined in the Second Report) for the period from June 22, 2015 to July 6, 2015; and
    5. the Company’s request for an extension of the Stay Period to July 6, 2015.

    Status of File as of June 24, 2015

    On June 23, 2015, the Applicant filed a motion for an order extending the Stay Period (as defined in paragraph 16 of the Initial Order dated April 30, 2015) to and including July 6, 2015, and an order approving the transaction contemplated by the the Hoidas Lake Sale Agreement and vesting all of GWMG’s rights, title and interest in and to the Hoidas Lake JV, as set out and described in the Hoidas Lake Sales Agreement, in Star Minerals Group Ltd., as purchaser, free and clear of all claims and encumbrances.

    The motion will be heard on June 26, 2015.

    Status of File as of May 29, 2015

    On May 28, 2015, the Court issued an order extending the Stay Period until and including June 26, 2015 and approving the First Report and the activities of the Monitor.

    Status of File as of May 26, 2015

    On May 25, 2015, the Applicant filed a motion for an order extending the Stay Period (as defined in paragraph 16 of the Initial Order dated April 30, 2015) to and including June 26, 2015 and approving the first report and activities of the Monitor. The motion will be heard on May 28, 2015.

    On May 26, 2015, the Monitor filed its First Report to Court to provide the Court with:

    1. Background information about the Company;
    2. Information regarding the Company’s operations since the date of the Initial Order;
    3. The Monitor’s views on the Revised Cash Flow Forecast as described in the First Report for the period from April 27, 2015 to July 3, 2015;
    4. An update on the Company’s sale and investment solicitation process (the “SISP”) and the milestones achieved to date; and
    5. The Monitor’s views on the Company’s request for an extension of the Stay Period.

    Status of File as of May 12, 2015

    On May 11, 2015, the Financial and Consumer Affairs Authority of Saskatchewan (“FCAA”) issued a Cease Trade Order against GWMG. A copy of the order can be found on our website under the Orders tab. For further details, please visit the FCAA’s website at http://www.fcaa.gov.sk.ca.


    This Web site will be updated as information becomes available.

    For more information, please contact: Tammy Muradova, Telephone: +1 416 941 8383 ext 14456, or via Email.