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Motion, Returnable February 1, 2018 1 1 Court File No.:CV-17-589016-00CL ONTARIO SUPERIOR COURT OF JUSTICE (COMMERCIAL LIST) IN THE MATTER OF THE COMPANIES CREDITORS ARRANGEMENT ACT, R.S.C. 1985, C. C-36, AS AMENDED AND IN THE MATTER OF A PLAN OF COMPROMISE OR ARRANGEMENT OF BANRO CORPORATION, BANRO GROUP (BARBADOS) LIMITED, BANRO CONGO (BARBADOS) LIMITED, NAMOYA (BARBADOS) LIMITED, LUGUSHWA (BARBADOS) LIMITED, TWANGIZA (BARBADOS) LIMITED AND KAMITUGA (BARBADOS) LIMITED (the “Applicants”) MOTION RECORD (RETURNABLE FEBRUARY 1, 2018) January 25, 2018 Cassels Brock & Blackwell LLP 2100 Scotia Plaza 40 King Street West Toronto, ON M5H 3C2 Ryan C. Jacobs LSUC# 59510J Tel: 416.860.6465 Fax: 416.640.3189 [email protected] Jane O. Dietrich LSUC# 49302U Tel: 416.860.5223 Fax: 416.640.3144 [email protected] Joseph J. Bellissimo LSUC# 46555R Tel: 416.860.6572 Fax: 416.642.7150 [email protected] Ben Goodis LSUC # 70303H Tel: 416.869.5312 Fax: 416.640.3199 [email protected] Lawyers for the Applicants TO: SERVICE LIST LEGAL*45182502.1 2 INDEX 3 Court File No.:CV-17-589016-00CL ONTARIO SUPERIOR COURT OF JUSTICE (COMMERCIAL LIST) IN THE MATTER OF THE COMPANIES CREDITORS ARRANGEMENT ACT, R.S.C. 1985, c. C-36, AS AMENDED AND IN THE MATTER OF A PLAN OF COMPROMISE OR ARRANGEMENT OF BANRO CORPORATION, BANRO GROUP (BARBADOS) LIMITED, BANRO CONGO (BARBADOS) LIMITED, NAMOYA (BARBADOS) LIMITED, LUGUSHWA (BARBADOS) LIMITED, TWANGIZA (BARBADOS) LIMITED AND KAMITUGA (BARBADOS) LIMITED (the “Applicants”) INDEX DOCUMENT TAB EXHIBIT Notice of Motion, returnable February 1, 2018 1 Schedule “A” – Draft Claims Procedure Order A Schedule “B” – Draft Meeting Order B Affidavit of Rory James Taylor, sworn January 25, 2018 2 First Affidavit of Rory James Taylor, sworn December 21, 2017, A without Exhibits Affidavit of Geoffrey Farr, sworn December 22, 2017, with Exhibits B Exhibit “A” – Support Agreement A Initial Order, dated December 22, 2017 C Stay Extension and CCAA Charges Priority Order, dated January D 18, 2018 SISP Approval Order, dated January 18, 2018 E Amended and Restated DIP Term Sheet, dated January 18, 2018 F Plan of Compromise and Reorganization, dated January 25, 2018 G Draft Information Circular H LEGAL*45190267.3 4 TAB 1 5 Court File No. CV-17-589016-00CL ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST IN THE MATTER OF THE COMPANIES’ CREDITORS ARRANGEMENT ACT, R.S.C. 1985, c. C-36, AS AMENDED AND IN THE MATTER OF A PLAN OF COMPROMISE OR ARRANGEMENT OF BANRO CORPORATION, BANRO GROUP (BARBADOS) LIMITED, BANRO CONGO (BARBADOS) LIMITED, NAMOYA (BARBADOS) LIMITED, LUGUSHWA (BARBADOS) LIMITED, TWANGIZA (BARBADOS) LIMITED AND KAMITUGA (BARBADOS) LIMITED (the "Applicants") NOTICE OF MOTION (Claims Procedure Order and Meeting Order) (Returnable February 1, 2018) The Applicants will make a motion before a Judge of the Ontario Superior Court of Justice (Commercial List) on February 1, 2018 at 10:00 a.m., or as soon after that time as the motion can be heard, at 330 University Avenue, Toronto, Ontario. PROPOSED METHOD OF HEARING: The Motion is to be heard orally. THE MOTION IS FOR: 1. An Order substantially in the form attached as Schedule “A” hereto (the “Claims Procedure Order”) inter alia: (a) if necessary, abridging the time for service of the Notice of Motion and the Motion Record herein and, if necessary, validating service thereof; (b) seeking approval of a procedure for the identification and determination of certain claims against the Applicants; and LEGAL*45113396.7 6 -2- (c) seeking approval of a procedure for the identification of claims against the Applicants’ Directors and Officers (as defined therein); 2. An Order substantially in the form attached as Schedule “B” hereto (the “Meeting Order”) inter alia: (a) if necessary, abridging the time for service of the Notice of Motion and the Motion Record herein and, if necessary, validating service thereof; (b) accepting the filing of a Consolidated Plan of Compromise and Reorganization in respect of the Applicants dated January 25, 2018 (the “Plan”)1; (c) authorizing the Applicants to establish two classes of Affected Creditors for the purpose of considering and voting on the Plan: (i) the Affected Secured Class; and (ii) the Affected Banro Unsecured Class; (d) authorizing the Applicants to call, hold and conduct a meeting of the Affected Secured Creditors and a meeting of the Affected Banro Unsecured Creditors (together, the “Creditors’ Meetings”) to consider and vote on a resolution to approve the Plan, and approving the procedures to be followed with respect to the Creditors’ Meetings; (e) approving the procedures to be followed with respect to the calling and conduct of the Creditors’ Meetings; (f) setting the date for the hearing of the Applicants’ motion seeking an order to sanction the Plan (the “Sanction Order”) should the Plan be approved by the required majorities of Affected Creditors at the Creditors’ Meetings; and 1 Terms not otherwise defined herein have the meanings given to them in the Plan. LEGAL*45113396.7 7 -3- (g) approving the second report of FTI Consulting Canada Inc. in its capacity as court appointed monitor (“Monitor”) (the “Second Report”) and the activities as set out therein; and 3. Such further and other relief as this Honourable Court may deem just. THE GROUNDS FOR THE MOTION ARE: Background 4. Banro Corporation (“Banro”) is the direct or indirect parent of Banro Group (Barbados) Limited, Banro Congo (Barbados) Limited, Namoya (Barbados) Limited, Lugushwa (Barbados) Limited, Twangiza (Barbados) Limited, and Kamituga (Barbados) Limited (together with Banro, the “Applicants”); 5. Banro is a Canadian public corporation involved in the exploration, development and mining of gold in the Democratic Republic of the Congo; 6. The Applicants obtained an initial order under the Companies’ Creditors Arrangement Act, R.S.C. c. C-36, as amended (the “CCAA”) on December 22, 2017 (the “Initial Order”)2; 7. The Stay Period, initially granted until January 19, 2018, has been extended to and including March 30, 2018 by an order of the Court dated January 18, 2018; 8. Prior to filing the CCAA application, the Applicants and the Non-Applicant Subsidiaries entered into a Support Agreement with the Requisite Consenting Parties under which the Banro Group agreed to seek approval of and comply with a sale and investment solicitation process (the “SISP”) and, if no Successful Bid (as defined in the Support Agreement) is identified, to proceed to take steps to complete the Recapitalization (as defined in the Support Agreement). The SISP 2 Terms not otherwise defined herein have the meanings given to them in the Initial Order. LEGAL*45113396.7 8 -4- was approved by the Court on January 18, 2018 and the Applicants, with the Monitor are taking steps to implement the SISP; 9. In order to be in a position to proceed with the Recapitalization as quickly as possible in the event that no Successful Bid is identified as a result of the SISP, and to comply with the milestones established by the DIP Term Sheet, the Applicants are now seeking approval of the Claims Procedure Order and the Meeting Order; Claims Procedure Order3 10. The proposed Claims Procedure Order provides separate procedures with respect to claims against the Applicants and claims against the Directors and Officers of the Applicants. The Plan only provides for a compromise of certain Affected Secured Creditors (being the Doré Loan, the Namoya Forward II Agreement and the Secured Notes) as well as certain Affected Banro Unsecured Creditors (being the Affected Secured Creditors to the extent of their Affected Banro Unsecured Deficiency Claims and the Listed Creditors). The procedures applicable to each of these categories of creditors of the Applicants are set out in the proposed Claims Procedure Order; 11. The proposed Claims Procedure Order also outlines: (a) a process for determination of claims by the CRA under section 6(3) of the CCAA so that payment of such amounts can be addressed on Plan implementation as required under the CCAA; and (b) a process for the identification of Director/Officer Claims; 3 Terms not otherwise defined herein have the meanings given to them in the proposed Claims Procedure Order. LEGAL*45113396.7 9 -5- 12. The Claims Bar Date under the proposed Claims Procedure Order is March 6, 2018. Setting a Claims Bar Date over four (4) weeks from the date of the proposed Claims Procedure Order will provide sufficient time for creditors of the Applicants in these circumstances to prepare and submit their Claims; Meeting Order4 13. The proposed Meeting Order provides for, among other things: (a) the acceptance of the plan for the purposes of filing and calling the Creditors’ Meetings to seek approval of the Plan; (b) the process to modify or amend the Plan; (c) the classification of Affected Creditors into two classes, the Affected Secured Creditor Class and the Affected Banro Unsecured Class for voting purposes; (d) the voting by Affected Secured Creditors with respect to their Affected Unsecured Deficiency Claims as part of the Affected Banro Unsecured Class; (e) separate notification and solicitation procedures for Affected Creditors (other than Beneficial Holders) and Beneficial Noteholders; (f) a declaration that no shareholders’ vote on the Plan will be required; (g) the procedures for conduct and voting at the Creditors’ Meetings, including with respect to Disputed Voting Claims; and (h) the scheduling of the Sanction Motion, in the event the Plan is approved at the Creditors’ Meeting; 4 Terms not otherwise defined herein have the meanings given to them in the proposed Meeting Order. LEGAL*45113396.7 10 -6- 14. The Meeting Order and Plan comply with the provisions of the CCAA; 15. Those grounds as set out in the Affidavit of Rory James Taylor sworn January 25, 2018 and the exhibits thereto (the “Third Taylor Affidavit”); 16.
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