Lightstream Resources Ltd. LSTMF

RE:LST commitment to unsecured as of Sept 30, 2016

[Oldfart74]

wizthewiz wrote: If there is a lawyer with a few minutes to spare, can you spell out in plain language what this means for the Common of LTS at this point? (And no need for the feather pluckers--you know who you are--to wade in here as you have nothing useful to add).

"The members of the Ad Hoc Committee have agreed that, subject to the terms and conditions of the Support Agreement, in the event that the Secured Notes Credit Bid is the successful bid, they will replicate the consideration offered to Unsecured Noteholders or Shareholders in the Recapitalization as part of the Secured Notes Credit Bid, provided that, the Unsecured Noteholders or Shareholders, as the case may be, previously approved the Recapitalization at the requisite levels at their respective special meetings held to vote on the Recapitalization. Alternatively, if the Secured Notes Credit Bid is not the successful bid, the members of the Ad Hoc Committee have agreed that, in the event that they are repaid in full, then upon receipt of such repayment they will make $20,000,000 available to Shareholders provided that the Shareholders previously approved the Recapitalization at the requisite levels at the special meeting held to vote on the Recapitalization and that no other consideration was made available to the Shareholders from the Ad Hoc Committee or otherwise. However, the obligation to pay such consideration to the Shareholders or Unsecured Noteholders, as applicable, is not applicable if certain Unsecured Noteholders are successful in obtaining any remedy in respect of their existing litigation against the Company that would have a material adverse effect on the Company or would impact the priority or composition of the Secured Noteholders."

 

On Sept 17, LTS announced that they were unable to reach an agreement with the holders of the unsecured notes.  As part of the previously announced restructuring agreement, it was a requirement of the support agreement that the agreement with unsecured note holders had to be reached on or before Sept 16.  If agreement was not reached by then, the company was required to cancel the previously announced plan of arrangement to be voted on at the Sept 30 meeting and file under CCAA.  On Sept 26, the company filed under CCAA and announced the postponement of the annual meeting scheduled for Sept 30.