TSX-VENTURE: SBX.V
VANCOUVER, May 2, 2017 /CNW/ - On April 28, 2017 the Supreme Court of British Columbia (the "Court") approved the
second amended proposal of Sea Breeze Power Corp. ("Power Corp.")
and one of its wholly-owned subsidiaries, Sea Breeze Energy Inc.
(together, "Sea Breeze" or the "Company"), dated April 21, 2017 (as amended, the "Proposal")
pursuant to the Bankruptcy and Insolvency Act (the
"BIA").
As a result of the Company's ongoing operational losses and
increasing liabilities it was unable to meet its obligations to
creditors and on December 30, 2016
the Company commenced proposal proceedings under the BIA. Through
the proposal proceedings the Company has sought to (i) satisfy
creditor claims, including the secured claims of certain
shareholders of the Company (collectively, the "Secured Lender
Group") that have advanced secured loans to the Company to fund its
operations; (ii) maximize recoveries for unsecured creditors; and
(iii) facilitate the continued development of the Company's many
projects.
An earlier version of the proposal was approved by the Company's
creditors at a meeting convened on January
18, 2017. The Proposal is expected to generate better
recoveries for the Company's creditors than would be available in a
bankruptcy and is designed to maximize the realizable value of the
Company's assets.
The Proposal contemplates that it will be implemented as soon as
practicable following Court approval and that upon
implementation:
- the Secured Lender Group will transfer all of the common shares
they own in Power Corp. to Tu-Can Energy LLC ("TuCan"), a limited
liability company controlled by the Secured Lender Group;
- Power Corp. will issue an additional one billion common shares
to TuCan, following which Power Corp.'s common shares will be
consolidated at a rate of 25 million to 1; and
- all fractional shares and other securities of Power Corp.,
except for the common shares held by TuCan, will subsequently be
cancelled, with the result that TuCan will be the sole shareholder
of Power Corp.
Payments to the Company's unsecured creditors will be funded
from various sources, including the Secured Lender Group and the
sale of certain of the Company's assets.
The Company's existing management will remain in place.
Because certain members of the Secured Lender Group are
directors of Power Corp., the Proposal may be considered a related
party transaction under Multilateral Instrument 61-101. In the
Order approving the Proposal, the Court confirmed that Power Corp.
does not have to comply with sections 5.4 and 5.6 of Multilateral
Instrument 61-101 and Power Corp. is entitled to rely on the
exemptions set forth in subsections 5.5(f)(i) and 5.7(d) to obviate
the need for obtaining a formal valuation in respect of the
existing equity of the company and minority approval in respect of
the transactions contemplated by the Proposal.
As Power Corp. will not meet the continued listing
requirements of the TSX Venture Exchange (the "TSXV") upon
completion of the implementation of the Proposal, Power Corp.
intends to have its common shares delisted from the TSXV and apply
to Canadian securities regulators to cease to be a reporting
issuer.
Sea Breeze believes the
Proposal provides the best possible outcome for its stakeholders in
the circumstances and intends to implement the Proposal as soon as
practicable.
Information concerning the Company's restructuring and the
Proposal can be found on website of the proposal trustee, Alvarez
& Marsal Canada Inc. (the "Proposal Trustee") at:
www.alvarezandmarsal.com/seabreeze. Any inquiries concerning
the Proposal may be directed to the Proposal Trustee.
Sea Breeze Power Corp. is a Vancouver-based renewable energy company
focused on unlocking British
Columbia's enormous but "stranded" renewable energy
potential. Sea Breeze has
been engaged in the development of utility-scale wind farms,
"run-of-river" hydroelectric projects, and through a joint venture,
the development of state-of-the-art electricity transmission
projects.
Neither TSX Venture Exchange nor its Regulation Services
Provider accepts responsibility for the adequacy or accuracy of
this release.
Cautionary Statement Regarding Forward-Looking Information
and Statements
This news release includes certain forward-looking
statements or information. All statements other than statements of
historical fact included in this release, including, without
limitation, statements regarding the Proposal are forward-looking
statements that involve various risks and uncertainties. There can
be no assurance that such statements will prove to be accurate and
actual results and future events could differ materially from those
anticipated in such statements. Important factors that could cause
actual results to differ materially from the Power Corp.'s
plans or expectations include risks relating to the failure to
implement the Proposal and other risks detailed herein and from
time to time in the filings made by Power Corp.
SOURCE Sea Breeze Power Corp.