CALGARY, Feb. 17, 2016 /CNW/ - Argent Energy Trust ("Argent" or the "Trust") (TSX: AET.UN) announces that, further to the news release issued by it earlier today, the Trust and its direct and indirect subsidiaries, Argent Energy (Canada) Holdings Inc. ("Argent Canada") and Argent Energy (U.S.) Holdings Inc. ("Argent U.S.", and together with the Trust and Argent Canada, the "Applicants"), have obtained creditor protection under the Companies' Creditors Arrangement Act (Canada) (the "CCAA") pursuant to an initial order (the "Initial Order") granted on February 17, 2016 by the Court of Queen's Bench of Alberta (the "Court"). The Court appointed FTI Consulting Canada Ltd. as the Monitor (the "Monitor") of each of the Applicants.
The Court granted protection under the CCAA for an initial period expiring on March 18, 2016, to be extended thereafter as the Court deems appropriate. The Initial Order, among other things, provides a stay of certain creditor claims and the exercise of contractual rights, and approves the continuation of the previously announced sale solicitation process (the "Sale Solicitation Process"). As previously announced, The Oil & Gas Clearinghouse, LLC will act as sales agent in connection with the Sale Solicitation Process. The Sale Solicitation Process is intended to generate interest in either the business or the assets of Argent U.S. with the goal of maximizing the return in respect of the assets of the Applicants.
During the CCAA proceedings, it is expected that the Applicants' operations will continue uninterrupted in the ordinary course of business and that everyday obligations to employees, key suppliers of goods and services and the Applicants' customers will, after the filing date, continue to be met on an ongoing basis. While under CCAA protection, management of the Applicants will remain responsible for the day-to-day operations of the respective Applicants 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 Applicants and the Applicants anticipate that such individuals will continue in their respective roles throughout the CCAA process.
Argent U.S. has received commitments from its existing lending syndicate for up to U.S.$7.3 million in interim financing to support its continued operations, which interim financing was approved by the Court in the Initial Order. The interim financing, with cash generated from ongoing operations, is expected to provide sufficient liquidity to support the business of the Applicants during the CCAA proceedings.
A copy of the Initial Order will be made available, and additional details relating to the CCAA proceedings will be accessible, on the Monitor's website at http://cfcanada.fticonsulting.com/argent. The Monitor has also established an information hotline for enquiries regarding the CCAA process at 1-877-754-5840.
Pursuant to the Initial Order, the Monitor was authorized to, and is expected to very shortly, file petitions under Chapter 15 of Title 11 of the United States Bankruptcy Code to obtain creditor protection and recognition of the CCAA proceedings in the United States in respect of Argent Canada and Argent U.S.
The trading on the Toronto Stock Exchange (the "TSX") of the units of the Trust, the 6.00% convertible unsecured subordinated debentures due June 30, 2018 and the 6.50% convertible unsecured subordinated debentures due December 30, 2018 have been halted and it is anticipated that the trading thereof will continue to be halted. As previously announced on February 2, 2016, the TSX is undertaking a review of the eligibility of the Trust for the continued listing of its securities on the TSX. Argent expects that review to be expedited and the securities of the Trust to be suspended from trading on the TSX indefinitely.
Further news releases will be provided on an ongoing basis through the CCAA process as may be determined necessary.
Note About Forward Looking Statements
This press release includes forward-looking information within the meaning of applicable Canadian and United States securities legislation. All statements, other than statements of historical facts, that address activities, circumstances, events, outcomes and other matters that Argent budgets, forecasts, plans, projects, estimates, expects, believes, assumes or anticipates (and other similar expressions) will, should or may occur in the future, are considered forward-looking information.
Forward-looking information contained in this news release includes, but is not limited to, statements concerning the CCAA proceedings, the Sale Solicitation Process, the Applicants' business operations and the satisfaction of their ongoing obligations to employees, key suppliers and customers during the CCAA proceedings, the composition of the management team and the boards of directors of the Applicants during the CCAA proceedings, the filing of petitions under Chapter 15 of Title 11 of the United States Bankruptcy Code and the TSX's review of the eligibility of the Trust's securities for trading on the TSX. The forward-looking information contained in this news release is based on management's current beliefs, expectations and assumptions, based on currently available information as to the outcome and timing of future events. The forward-looking information contained in this news release involves risks and uncertainties which may cause actual results or performance to be materially different from any future results or performance expressed or implied herein. These risks and uncertainties include, but are not limited to, the uncertainty involved in the CCAA proceedings and the proceedings expected to be commenced under Chapter 15 of Title 11 of the United States Bankruptcy Code, the liquidity and level of indebtedness of the Applicants, the success of the Sale Solicitation Process, the business and financial affairs of the Applicants, the cooperation of the creditors of the Applicants, the Applicants' ability to meet their ongoing obligations during the CCAA proceedings and thereafter, the ability of the Applicants to maintain relationships with key suppliers, customers, employees and other third parties in light of the events leading up to and including the CCAA proceedings, and other general assumptions regarding, among other things, industry activity, the general stability of the economic and political environment, the effect of market conditions on commodity prices and exchange rates, the ability to obtain goods and services in a timely and cost-efficient manner, and the ability to maintain current production levels.
Forward-looking information is subject to a number of risks and uncertainties, including those mentioned above, that could cause actual results to differ materially from the expectations set forth in the forward-looking information. Forward-looking information is not a guarantee of future results or performance or an assurance that our current assumptions and projections are valid. All forward-looking information speaks only as of the date of this news release, and the Trust assumes no obligation to, and expressly disclaims any obligation to, update or revise any forward-looking information, except as required by law. You should not place undue reliance on forward-looking information. You are encouraged to closely consider the additional disclosures and risk factors contained in the Trust's periodic filings on SEDAR that discuss in further detail the factors that could cause future results to be different than contemplated in this press release.
About Argent Energy Trust
Argent is a mutual fund trust under the Income Tax Act (Canada). Argent's objective is to create stable, consistent returns for investors through the acquisition and development of oil and natural gas reserves and production with low risk exploration potential, located primarily in the United States. Material information pertaining to Argent Energy Trust may be found on www.sedar.com or www.argentenergytrust.com.
SOURCE Argent Energy Trust
For further information: Sean Bovingdon, President & Chief Financial Officer, Argent Energy Trust, (403) 770-4809; Steve Hicks, Chief Operating Officer, Argent Energy Trust, (281) 847-1888