Court File No. CV-11-9532-00CL ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST B E T W E E N: IN THE MATTER OF THE COMPANIES' CREDITORS ARRANGEMENT ACT, 1985, c. C-36 AS AMENDED AND IN THE MATTER OF A PLAN OF COMPROMISE OR ARRANGEMENT OF CRYSTALLEX INTERNATIONAL CORPORATION ______________________________________________________________________ SUPPLEMENTAL RECORD OF THE DIP LENDER (Motion Returnable: April 11, 2016) ______________________________________________________________________ April 10, 2016 CASSELS BROCK & BLACKWELL LLP Barristers and Solicitors Scotia Plaza 40 King Street West Suite 2100 Toronto, ON M5H 3C2 Timothy Pinos LSUC #: 20027U Tel: 416.869.5784 Fax: 416.350.6903 [email protected] Shayne Kukulowicz LSUC #: 30729S Tel: 416.860.6463 Fax: 416.640.3176 [email protected] Ryan C. Jacobs LSUC #: 59510J Tel: 416.860.6465 Fax: 416.640.3189 [email protected] Lawyers for the DIP Lender TO: DAVIES WARD PHILLIPS & VINEBERG LLP Barristers and Solicitors 155 Wellington Street West 40th Floor Toronto ON M5V 3J7 Jay Swartz LSUC #: 15417L James Doris LSUC #: 33236P Natalie Renner LSUC #: 55954A Tel: 416.863.0900 Fax: 416.863.0871 Lawyers for Crystallex International Corporation AND TO: STIKEMAN ELLIOTT LLP Barristers and Solicitors 5300 Commerce Court West 199 Bay Street Toronto ON M5L 1B9 David Byers Tel: 416.869.5697 Fax: 416.957.0866 [email protected] Maria Konyukhova Tel: 416.869.5230 Fax: 416.957.0866 [email protected] Lawyers for Ernst & Young Inc., in its capacity as the monitor AND TO: GOODMANS LLP Barristers and Solicitors Bay Adelaide Centre 333 Bay Street Suite 3400 Toronto ON M5H 2S7 Jay Carfagnini Tel: 416.597.4107 Fax: 416.979.1234 [email protected] Robert Chadwick Tel: 416.597.4285 [email protected] Celia Rhea Tel: 416.597.4178 [email protected] Chris Armstrong Tel: 416.849.6013 [email protected] Lawyers for Computershare Trust Company of Canada, in its capacity as Trustee for the Holders of 9.375% Senior Unsecured Notes of Crystallex International Corporation AND TO: THORNTON, GROUT, FINNIGAN Barristers and Solicitors Canadian Pacific Tower 100 Wellington Street West, Suite 3200 P.O. Box 329, TD Centre Toronto ON M5K 1K7 John T. Porter Tel: 416.304.0778 Fax: 416.304.1313 [email protected] Lawyers for Juan Antonio Reyes AND TO: NORTON ROSE OR LLP Barristers and Solicitors Royal Bank Plaza, South Tower 200 Bay Street, Suite 3800 Toronto ON M5J 2Z4 Robert Frank Tel: 416.202.6741 Fax: 416.360.8277 [email protected] Ryan Hauk Tel: 416.203.4468 Fax: 416.360.8277 [email protected] Lawyers for Forbes & Manhattan Inc. and Aberdeen International Inc. AND TO: LENCZNER SLAGHT ROYCE SMITH GRIFFIN LLP Barristers and Solicitors 130 Adelaide Street West Suite 2600 Toronto ON M5H 3P5 Peter H. Griffin Tel: 416.865.2921 Fax: 416.865.3568 [email protected] Lawyers for McMillan LLP AND TO: ERNST & YOUNG INC. 222 Bay Street, P.O. Box 251 Toronto,ON M5K 1J7 Brian M. Denega Tel: 416.943.3058 Fax: 416.943-3300 [email protected] Fiona Han Tel: 416.943.3739 Fax: 416.943-3300 [email protected] Court-appointed Monitor AND TO: GOWLING WLG (CANADA) LLP Barristers and Solicitors 1 First Canadian Place 100 King Street West Suite 1600 Toronto ON M5X 1G5 David Cohen Tel: 416.369.6667 Fax: 416.862.7661 [email protected] Clifton Prophet Tel: 416.862.3509 Fax: 416.862.7661 [email protected] Nicolas Kluge Tel: 416.369.4610 Fax: 416.862.7661 [email protected] Lawyers for the ad hoc committee of shareholders of Crystallex AND TO: OSLER, HOSKIN & HARCOURT LLP Barristers and Solicitors 100 King Street West 1 First Canadian Place Suite 4600, P.O. Box 50 Toronto ON M5X 1B8 Alexander Cobb Tel: 416.862.5964 Fax: 416.862.6666 [email protected] Lawyers for Greywolf Loan Participation LLC 1 Court File No. CV-11-9532-OOCL ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST BETWEEN: IN THE MATTER OF THE COMPANIES' CREDITORS ARRANGEMENT ACT, 1985, c. C-36 AS AMENDED AND IN THE MATTER OF A PLAN OF COMPROMISE OR ARRANGEMENT OF CRYSTALLEX INTERNATIONAL CORPORATION AFFIDAVIT 1, Hilary Fender, of the City of Toronto, in the Province of Ontario, MAKE OATH AND SAY: 1. I am an Associate with the law firm of Cassels, Brock &Blackwell LLP, lawyers to the DIP Lender and, as such, have knowledge of the following matters. I. BREACH OF CONFIDENTIALITY AGREEMENT BY SHAREHOLDERS 2. On December 18, 2014, this Court issued the Approval Order, a copy of which is attached hereto and marked as Exhibit "A". 3. Paragraph 6 of the Approval Order provided that subject to the execution of a proper confidentiality agreement, the Applicant or the Monitor may provide to counsel, and such stakeholders that executed such a confidentiality agreement, access to certain of the Applicant's confidential information and documents. 4. I have been advised by Jay Swartz of Davies, Ward, Phillips & Vineberg LLP, counsel for the Applicant, that following entry of the Approval Order, a confidentiality Lega1~25148685.1 2 2 agreement was signed by Mr. Justin Fine, a member of the ad hoc committee of shareholders (the "Ad Hoc Committee") seeking Court approval of such committee. Attached hereto and marked as Exhibit "B" is the confidentiality agreement executed by Mr. Fine. 5. I have also been advised by Jay Swartz that a confidentiality agreement in the same form as the agreement signed by Justin Fine and attached hereto was signed by Mr. Lyn Goldberg. Mr. Goldberg is also a member of the Ad Hoc Committee. Mr. Swartz has also advised me that Cowling WLG (Canada) LLP ("Cowlings"), counsel to the Ad Hoc Committee, has not signed a confidentiality agreement with the Applicant. 6. I have accessed the Monitor's website and have reviewed the thirteenth report of the Monitor dated December 14, 2014 (the "Thirteenth Monitor's Report"). The Thirteenth Monitor's Report is redacted to maintain the confidentiality of certain information. Attached hereto and marked as Exhibit "C" is the Thirteenth Report of the Monitor in its redacted form. 7. I understand from Mr. Swartz that the unredacted version of the Thirteenth Monitor's Report had only been provided to certain of the parties who had signed confidentiality agreements, including Ad Hoc Committee member shareholders Mrrs. Fine and Goldberg. I have reviewed the unredacted version of Thirteenth Monitor's -•. 8. On April 8, 2016 at 1:31 p.m., Delna Contractor, associate at Cowlings sent to the service list in these proceedings via email the reply factum of the Ad Hoc Committee (the "Reply Factum") for their motion returnable April 11, 2016. I have reviewed the attached Legal`25148685.1 3 3 Reply Factum, which appears to contain or use information highly confidential information included in the Thirteenth Monitor's Report which had been redacted. Attached hereto and marked as Exhibit "D" is the email sent by Delna Contractor at 1:31 p.m. 9. On April 8, 2016 at 2:02 p.m., Mr. Swartz sent an email to counsel at Cowlings and Cassels Brock &Blackwell LLP, informing Cowlings that the information contained in the Reply Factum relating to the DIP financing had been redacted from the Thirteenth Monitor's Report, such unredacted copies had been provided to certain of Cowlings clients pursuant to confidentiality agreements, and such clients were not permitted to share or publish this information. The email stated that this conduct was in breach of the agreement. Attached hereto and marked as Exhibit "E" is the email sent by Mr. Swartz at 2:02 p.m. 10. At 2:25 p.m., almost an hour after the unredacted Reply Factum was sent to the service list, and over twenty minutes after Jay Swartz informed Cowlings of the release of such confidential information, Nicholas Kluge, partner at Cowlings, sent via email to the service list an email stating that the incorrect, unredacted version of the Reply Factum had been served by way of the email from Delna Contractor at 1:31 p.m. The email requested that all recipients of such email delete the copy of the unredacted Reply Factum, and stated that the correct, redacted version of the Reply Factum was attached. Attached hereto and marked as Exhibit "F" is the email sent by Mr. Kluge at 2:25 p.m. 11. At 2:35 p.m., Mr. Kluge sent an email to Mr. Swartz, copying counsel at Stikeman Elliott LAP, Cassels, Brock &Blackwell LLP and Davies, Ward, Phillips & Vineberg LLP, informing them that the correct, redacted version of the Reply Factum had been filed with Legal"25148685.1 4 the Court, and that the book of authorities containing the unredacted Thirteenth Monitor's Report had not been filed with the Court but would be provided directly to Justice Newbould. Mr. Kluge confirmed that the unredacted Report had been provided to him by an unnamed client "who had executed a confidentiality agreement." He further stated that the unredacted Reply Factum had not been circulated to any proposed members of the Ad Hoc Committee, or any other person, and that Cowlings would maintain the confidentiality of the Thirteenth Monitor's Report and execute a confidentiality agreement if the parties wished. Attached hereto and marked as Exhibit "G" is the email sent by Nicholas Kluge at 2:35 p.m. II. FINANCIAL CONDITION OF VENEZUELA 12. It is a matter of public record that a number of news articles have been recently published remarking on the poor financial state of the nation Venezuela. In an article published by Bloomberg Technology on March 14, 2016, the author states that "swaps traders put the odds of Venezuela default in the next five years at 91 percent, the highest in the world".