May 3, 2017
We are pleased to announce that the Superior Court of Justice (Commercial List) approved a Waiver and Reserve Agreement today which will allow the Monitor to make distributions. Based on the Monitor’s Report filed for the motion, the Monitor believes it will be able to distribute in late June or early July.
The Waiver and Reserve Agreement permits $44 million to be set aside. $44 million is the amount identified as necessary to make all of the LTD beneficiaries whole for the loss of their income benefits. Although unlikely, if the dissenting LTD Beneficiaries are successful, an additional $44 million will be distributed to LTD members over and above the amounts they would receive under the Plan of Compromise. If, however, leave to appeal is denied by the Supreme Court of Canada or the dissenting LTD Beneficiaries are not ultimately successful in an appeal, the $44 million will be put back in the pool of funds to be shared in a future distribution to all creditors.
The Waiver and Reserve Agreement also permits the Settlement Agreement and Plan of Compromise to be implemented notwithstanding that appeals or leaves to appeal the Sanction Order are outstanding.
Relevant documents can be accessed as follows:
Approval of the Waiver and Reserve Agreement must also be obtained from the US Bankruptcy Court. A hearing is scheduled for May 5, 2017.
As previously reported, the distribution to former Canadian employees including LTD Beneficiaries and retirees will be 45-49 cents on every dollar of approved claim with more than one distribution expected.
During the hearing on May 1, 2017 the two dissenting LTD Beneficiaries advised the court that they do intend to seek leave to appeal to the Supreme Court of Canada. The deadline to file their material is May 12, 2017. Justice Newbould’s endorsement urges the Supreme Court of Canada to expedite the hearing of the issue.
We will continue to update you as information becomes available. Please continue to check back for updates including information sessions (schedule to be announced) for information about the distribution and taxation matters.