Arctic Beverages Sask Limited

Notice of Intention to Make a Proposal

^{Page last updated: May 20, 2014}

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 March 19, 2014, Arctic Beverages Sask Limited (“Arctic Sask”) filed a Notice of Intention to Make a Proposal (“NOI”) pursuant to Section 50.4(1) of the Bankruptcy and Insolvency Act (Canada) (“BIA”) and PricewaterhouseCoopers Inc. was named as the trustee under the NOI (the “Trustee”).

Notice of the NOI and the Trustee’s appointment was mailed to all affected creditors of Arctic Sask on March 26, 2014.

Status Update as of May 16, 2014

On May 12, 2014, the Court issued an order, which among other things:

1. Approve the sale transaction contemplated by the Asset Purchase Agreement between Arctic Beverages (the “Vendors”) and 6898662 Beverages LP, by its General Partner, 6898662 Manitoba Ltd. (the “Purchaser”);
2. Vested in the Purchaser the Vendors’ right, title and interest in and to the assets described in the Asset Purchase Agreement;
3. Assigned the rights and obligations of the Vendors under the Critical Supplier Contracts and certain Other Assumed Key Supplier Contracts (both as defined in the Asset Purchase Agreement);
4. Authorized and directed the Trustee to pay on closing from the proceeds of the Transaction, the Cure Payments and Other Assumed Supplier Payables (both as defined in the Asset Purchase Agreement) and to repay the DIP Loan (as defined in the Order of the Court dated April 17, 2014) to Exchange Income Corporation, and pay certain other amounts to Royal Bank of Canada, Exchange Income Corporation, 7328010 Canada Limited and others on closing, or hold and make provision for payment of certain amounts after closing;
5. Provided an Administration Charge in relation to the net proceeds of the Transaction, in an amount to be determined; and
6. Extending the time within which the Trustee may file a proposal with the Official Receiver in the within proposal proceedings, to Thursday, June 26, 2014.

On May 8, 2014 the Financial Advisor prepared its Third Report to provide the Court with further information in respect of the Sales Process, including:

1. Further information on the Sale Process activities, including dealings with interested parties, discussions with Pepsico Canada ULC and ABL management, Asset Purchase Agreement documentation and data room information;
2. A summary and assessment of all bids received during the Sale Process; and
3. Further information regarding the selection of a recommended bid.

Status Update as of May 8, 2014

On May 8, 2014, the Trustee filed a motion with Court for an Order:

1. Approving the sale transaction contemplated by the Asset Purchase Agreement between Arctic Beverages (the “Vendors”) and 6898662 Beverages LP, by its General Partner, 6898662 Manitoba Ltd. (the “Purchaser”);
2. Vesting in the Purchaser the Vendors’ right, title and interest in and to the assets described in the Asset Purchase Agreement;
3. Assigning the rights and obligations of the Vendors under the Critical Supplier Contracts and certain Other Assumed Key Supplier Contracts (both as defined in the Asset Purchase Agreement);
4. Authorizing and directing the Trustee to pay on closing from the proceeds of the Transaction, the Cure Payments and Other Assumed Supplier Payables (both as defined in the Asset Purchase Agreement) and to repay the DIP Loan (as defined in the Order of the Court dated April 17, 2014) to Exchange Income Corporation, and pay certain other amounts to Royal Bank of Canada, Exchange Income Corporation, 7328010 Canada Limited and others on closing, or hold and make provision for payment of certain amounts after closing;
5. Providing an Administration Charge in relation to the net proceeds of the Transaction, in an amount to be determined;
6. Extending the time within which the Trustee may file a proposal with the Official Receiver in the within proposal proceedings, to Thursday, June 26, 2014; and
7. Sealing the Confidential Third Report of PricewaterhouseCoopers Corporate Finance Inc. until further order of the Court.

A motion will be heard on Monday, May 12, 2014.

This Web site will be updated as information becomes available.

For more information, please contact: David A. Johnson, Telephone: +1 204 926 2423, Fax: +1 204 956 1404, or via Email.