CALGARY, April 20, 2017 /CNW/ - Dear Twin Butte Debentureholders,
We, the Ad Hoc Committee of unaffiliated holders (the "Ad Hoc Group") of 6.25% Convertible Unsecured Subordinated Debentures due December 31, 2018 of Twin Butte Energy Ltd. ("Twin Butte"), wish to update Twin Butte's Debentureholders concerning recent developments in connection with the Receivership sales and investment solicitation process ("SISP"):
- On March 30, 2017, FTI Consulting Canada Inc., the Court-appointed Receiver of Twin Butte (the "Receiver") filed its Receiver's Certificate, certifying that the asset sale to HOC (the "HOC Transaction") had been completed to the satisfaction of the Receiver, and the Receiver made an interim distribution repaying Twin Butte's Banking Syndicate in full;
- The Receiver's Third Report indicates that the HOC Transaction provides for a "substantial distribution" to unsecured creditors including the Debentureholder class;
- As such, the Ad Hoc Group's successful campaign to reject the proposed transaction between Twin Butte and Reignwood Resources Holding Pte. Ltd. in favour of an alternate transaction will provide for a more equitable distribution to Debentureholders;
- The Ad Hoc Group will now focus its attention on ensuring that the remaining distributions to the entire class of Debentureholders are maximized with the ongoing assistance of its financial and legal advisors;
- The Ad Hoc Group believes that the ongoing involvement of its financial and legal advisors will provide additional substantial benefit to all debentureholders by, among other things, providing additional financial and legal advice to the Ad Hoc Group regarding the claims of other creditors in the anticipated creditor claims process and advising on and conducting further negotiations and/or litigation to take all necessary steps to enhance the position and recovery of all Debentureholders; the Ad Hoc Group anticipates this may result in an improvement to each Debentureholder's recovery from a potential low end recovery of approximately $450 per $1,000 face value of Debenture to a potential high end recovery of $600 per $1,000 face value Debenture, subject to among other things, the claims process (Note: This range is indicative only as the Ad Hoc Group does not have detailed information on the existing or potential claims that may arise as part of the claims process. As such the actual recovery realized by Debentureholders could be higher or lower than these estimates); if the Ad Hoc Committee's application is successful, each Debentureholder's pro rata share of the aggregate cost of the Ad Hoc Committee's legal and financial advisory services, is estimated to be approximately $26 per $1,000 face value Debenture to $37 per $1,000 face value Debenture (including estimated fees to conclusion);
- The Ad Hoc Group is making an application in the Court of Queen's Bench of Alberta (the "Court") in Calgary at 2:00 p.m. Mountain time on Thursday, April 27, 2017;
- Further details about the Ad Hoc Group's court application and with respect to actions of the Ad Hoc Group and its advisors throughout the Receivership SISP are contained in the Affidavit of Mike Maguire which has been filed with the Court and is available on the website of the Receiver (http://cfcanada.fticonsulting.com/TwinButte).
We look forward to working with other stakeholders to achieve an expeditious conclusion to the Receivership process.
SOURCE Informal Committee of Concerned Debentureholders of Twin Butte