Pride Group Holdings Inc. and other applicant companies (the “Applicants”) sought and obtained protection under the Companies’ Creditors Arrangement Act (the “CCAA”) pursuant to an Initial Order of the Ontario Superior Court of Justice (Commercial List) (the “Initial Order”). Other companies affiliated with the Applicants (the “Additional Stay Parties”, and together with Applicants, the “Pride Group”), although not applicants themselves, were granted a stay of proceedings as part of these proceedings under the CCAA (the “CCAA Proceedings”) for the duration of 10-days, subject to extension thereafter as the Court deems appropriate.
Certain companies in the Pride Group will file cases under Chapter 15 of Title 11 of the United States Code in the United States Bankruptcy Court for the District of Delaware (the “Chapter 15 Cases”) seeking recognition of the CCAA Proceedings within the territorial jurisdiction of the United States and other related relief.
We have taken these steps to commence the CCAA Proceedings and to seek recognition under the Chapter 15 Cases so that we can maintain our current operations, stabilize our business, establish governance controls and monitoring, and develop a plan to restructure for the benefit of our stakeholders. We believe this is in the best interests of all of our employees, customers, business partners and other stakeholders.
During the course of the CCAA Proceedings and Chapter 15 Cases, it is expected to be business-as-usual for the Pride Group as we continue to operate in the ordinary course under the protection of the Initial Order. We do not anticipate any disruption to the products and services we provide.
The Pride Group intends to use the protections afforded to it by the Initial Order to reorganize and/or restructure its businesses to address short- and long-term goals. We are optimistic and confident that the Pride Group will emerge from these proceedings as a stronger company with stronger overall financial health.
Ernst & Young Inc. has been appointed as Monitor in the CCAA Proceedings, and has retained Blake, Cassels & Graydon LLP as their legal counsel. The Pride Group has retained Thornton Grout Finnigan LLP as their Canadian legal counsel, and Linklaters LLP as their U.S. legal counsel, to assist them with this restructuring process.
