TORONTO, Aug. 17, 2016 /CNW/ - West Face SPV (Cayman) III Inc. ("WFSPV"), a wholly-owned subsidiary of West Face Long Term Opportunities Global Master L.P. ("GMLP"), has filed an early warning report announcing that WFSPV acquired ownership of: (i) 4,152,082 common shares (the "Shares") of Chieftain Metals Corp. (the "Issuer") for cash consideration of $558,641.87, (ii) $500,000 principal amount of 8.0% Convertible Unsecured Debentures Series A of the Issuer (the "Series A Debentures") for cash consideration of $67,272.50, and (iii) $1,000,000 principal amount of 8.0% Convertible Unsecured Debentures Series B of the Issuer (the "Series B Debentures" and together with the Series A Debentures, the "Debentures") for cash consideration of $134,545.00. These Debentures are together convertible into 1,500,000 Shares of the Issuer. The Shares and Debentures were acquired by WFSPV pursuant to a private transfer of the Shares and Debentures from GMLP to WFSPV (the "Transfer") and not pursuant to market purchases.
After completion of the Transfer, WFSPV held 4,152,082 Shares of the Issuer, the Series A Debentures and the Series B Debentures. These holdings correspond to a securityholding percentage of 30.97%, assuming conversion of all Debentures. Prior to the Transfer, WFSPV did not own any securities of the Issuer.
The Shares and Debentures were acquired by WFSPV from GMLP for portfolio and risk management purposes and the acquisition does not reflect a change in investment intent of either GMLP or WFSPV. West Face Capital Inc. ("WFCI"), the investment manager of GMLP and WFSPV, exercises control or direction over the securities referred to above. While GMLP previously had the right to receive a forbearance payment (the "Forbearance Payment") in Shares pursuant to a forbearance agreement between GMLP and the Issuer as disclosed in a material change report filed by the Issuer on SEDAR on May 18, 2016 (the "Forbearance Agreement"), WFCI has elected on behalf of GMLP to receive the Forbearance Payment entirely in cash. WFCI has issued a demand for payment and a Notice of Intention to Enforce Security pursuant to the Bankruptcy and Insolvency Act to the Issuer in respect of a guarantee and related security it holds from the Issuer on the assets, property and undertaking of the Issuer, which has guaranteed the obligations of Chieftain Metals Inc. to GMLP. WFCI and GMLP are currently evaluating their options and alternatives in connection with possible enforcement proceedings as against the Issuer.
WFSPV is relying on the private agreement exemption in section 4.2 of National Instrument 62-104 – Takeover Bids and Issuer Bids ("NI 62-104") with respect to the Transfer. WFSPV acquired the Shares and Debentures from only GMLP and for consideration not greater than 115% of the market price of the Shares and Debentures as determined in accordance with section 1.11 of NI 62-104.
SOURCE West Face Capital Inc.
For further information: or to obtain a copy of the early warning report, please contact: West Face SPV (Cayman) III Inc. c/o West Face Capital Inc., 2 Bloor Street East, Suite 3000, P.O. Box 85, Toronto, Ontario, M4W 1A8, Supriya Kapoor, Chief Compliance Officer, West Face Capital Inc., 647-724-8900