All dollars referred to below are Canadian.
On May 15, 2007, the Court approved, among other things, a 10th Distribution in the amount of $50 million, to be allocated in accordance with the Settlement described below, $10 million or 3.3 cents on the dollar of their allowed claims to the Ordinary Creditors and $40 million or 14.9 cents on the dollar of the 1994 Amount (defined below) to the Sub Debt Holders. The 10th Distribution will bring the total amount paid to Ordinary Creditors in post liquidation interest to 21.4 cents of their allowed claims, or approximately 3.1% per annum simple interest since the date of liquidation, and the total paid to Sub Debt Holders to 87.4% of the 1994 Amount.
The Court also approved the Liquidator’s request for Additional Compensation as defined and described below and in the Liquidator’s Motion.
For the Liquidator’s motion record, click here
TENTH DISTRIBUTION TO CREDITORS
The Liquidator will make the distribution on allowed Ordinary Creditor claims in the amount of $10 million mailing cheques on May 30, 2007
FIFTH DISTRIBUTION TO SUB DEBT HOLDERS
The Settlement
Under the settlement, any monies remaining in the estate after Ordinary Creditors have received payment of 100% of their allowed claims will be distributed in accordance with the following formula:
- the first $55 million to Sub Debt Holders on account of the amount outstanding on the Sub Debt as at August 12, 1994 ("the 1994 Amount"), on a pro rata, pari passu basis in accordance with their interest in the Sub Debt
- the next $20 million to the Ordinary Creditors on a pro rata, pari passu basis on account of interest on their allowed claims from August 12, 1994, being the commencement of the liquidation; and
- of any amounts in excess of $75 million, 80% to the Sub Debt Holders and 20% to the Ordinary Creditors, both on the basis set out in (a) and (b) above.
The Court also confirmed that the total global claim of the Sub Debt Holders is $267,299,686, being comprised of $222,960,166 for the Pound Sterling Issue and $44,339,520 for the Luxembourg Franc Issue. These amounts include interest accrued to August 12, 1994. The exchange rates are the Bank of Canada noon spot rate of exchange for such currencies on August 12, 1994, the date the liquidation is deemed to have commenced. The rate for Pounds Sterling was $2.1353, and for Luxembourg Francs was $0.04297.
Financial Projections
Based on the Liquidator’s current projections after taking into account the Additional Compensation, and using the above exchange rates, the ultimate payments from the estate will result in:
- the Sub Debt Holders recovering 95.3% of the 1994 Amount, of which a total of 87.4% will have been paid if the Fifth Distribution is approved and made; and
- the Ordinary Creditors recovering approximately 3.3% simple interest per annum on their allowed claims, or about 23.3% of their claim amounts, of which 3.1% simple interest or 21.4% of the claims will have been distributed when the 10th distribution is made.
Note: These projections are estimates and subject to a number of contingencies. Actual results will vary from the projections and the variation may be material. Therefore, undue reliance should not be placed on these projections.
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