Walter Energy Canada Holdings, Inc.

Status of Proceedings

On October 21, 2020, New Walter Energy Canada Holdings, Inc., New Walter Canadian Coal Corp., Cambrian Energybuild Holdings ULC, New Willow Creek Coal Corp., New Wolverine Coal Corp., and New Brule Coal Corp. made assignments in bankruptcy. As a result, and in accordance with the Court Order dated February 25, 2020, these CCAA proceedings have now been terminated. Below is a copy of the monitor's certificate that is filed with the Court.

Monitor's Certificate

CCAA Proceedings

KPMG Inc. (“KPMG” or the “Monitor”) was appointed as Monitor pursuant to the Initial Order issued by the Supreme Court of British Columbia (the “Court”) on December 7, 2015 in respect of the application filed by Walter Energy Canada Holdings, Inc., Walter Canadian Coal ULC, Wolverine Coal ULC, Brule Coal ULC, Cambrian Energybuild Holdings ULC (“Cambrian”), Willow Creek Coal ULC, Pine Valley Coal Ltd. and 0541237 B.C. Ltd.(collectively, the “Original Petitioners”) under the Companies' Creditors Arrangement Act, R.S.C. 1985, c. C-36, as amended (the "CCAA"), granting a stay of proceedings (the “Stay”) that was most recently extended to December 1, 2018. The Stay and certain other relief was also extended to Walter Canadian Coal Partnership, Wolverine Coal Partnership, Brule Coal Partnership and Willow Creek Coal Partnership (collectively with the Original Petitioners, “Old Walter Canada”).

On December 28, 2016, pursuant to orders of the Court which were granted on December 7, 2016 and December 21, 2016, as well as bankruptcy and proposal proceedings which were initiated by Old Walter Canada under the Bankruptcy and Insolvency Act (the “BIA”) during December 2016, the CCAA Proceedings in respect of all of the Old Walter Canada entities, except for Cambrian, were terminated and the CCAA Proceedings were continued with respect to Cambrian and the following new entities which were formed and became petitioners in the CCAA Proceedings on December 8, 2016 (the “New Walter Entities” which, collectively with Cambrian, are referred to herein as “Walter Canada”):

• New Walter Energy Canada Holdings, Inc.;
• New Walter Canadian Coal Corp.; New Brule Coal Corp.;
• New Willow Creek Coal Corp.; and
• New Wolverine Coal Corp.

Please refer to the Monitor’s Reports, Court Materials and other information posted below for additional information regarding the CCAA Proceedings to date.

On May 31, 2018, the Court granted an order accepting the filing of Walter Canada’s Plan of Compromise and Arrangement dated May 29, 2018 (the “Plan”) and authorizing it to call meetings of its creditors that were deemed to have occurred on June 27, 2018 and authorizing deemed votes of all of New Walter Canada’s creditors in favour of resolutions to approve the Plan.

On July 3, 2018, the Court granted an order sanctioning the Plan which required that certain conditions precedent be fulfilled prior to the Plan being implemented. On April 24, 2019, the final condition precedent was satisfied and the Plan was implemented on the same date.

The distribution to former employees of New Wolverine Coal Corp. cannot occur until Service Canada has completed its review of Employment Insurance overpayments. All required information was submitted to Service Canada on April 24, 2019. At this time, the Monitor does not have any indication on the timing of an ultimate distribution in respect of Employee Claims.

Given that the Plan contemplates the making of cash distributions to New Walter Canada’s creditors in due course, the Monitor encourages creditors to review the Claims Register dated as at May 12, 2018 that is posted below under the “Plan of Compromise and Arrangement Materials” heading (and attached to the Eighteenth Report of the Monitor) and contact the Monitor at the coordinates listed below to advise of any errors or changes in their contact details as any notices and cash distributions shall be sent to the addresses listed on the Claims Register.

BIA PROCEEDINGS

As noted above, Old Walter Canada entered into and completed the Restructuring Transaction, which generated approximately $17 million of additional cash for Old Walter Canada’s creditors and other stakeholders. The Restructuring Transaction was approved by Order of the Court on December 7, 2016 and closed on December 29, 2016.

In order to effect the completion of the Restructuring Transaction, eleven of the Old Walter Canada entities each filed a voluntary assignment in bankruptcy pursuant to the BIA on December 15, 2016 and KPMG Inc. was appointed trustee (the “Bankruptcy Trustee”) of each estate.

On December 16, 2016, the Bankruptcy Trustee applied to the Court for an order to, amongst other things, procedurally consolidate the administration of the eleven estates including holding one consolidated first meeting of creditors for all eleven estates (the “First Meeting of Creditors”). A copy of the order is posted below.

The First Meeting of Creditors was held on December 19, 2016 and, immediately following the First Meeting of Creditors, the Bankruptcy Trustee filed a proposal (the “Joint Proposal”) to the creditors of Old Walter Canada pursuant to the BIA on December 19, 2016. A copy of the Joint Proposal is posted below.

The Meeting of Creditors to vote on the Joint Proposal was held on December 19, 2016, at which the creditors approved the Joint Proposal. The application for Court approval of the Joint Proposal was heard on December 21, 2016, and the Joint Proposal was sanctioned and approved by the Court on that date pursuant to the Proposal Sanction Order, a copy of which is posted below.

Please note that all allowed claims filed against Old Walter Canada under the CCAA Proceedings have been transferred to the applicable members of the New Walter Group and will be dealt with under the CCAA Proceedings.