CCAA FAQ
GENERAL
What is CCAA and why is Northern Pulp Nova Scotia filing?

The Companies' Creditors Arrangement Act (commonly referred to as the "CCAA") is a federal law in Canada that allows certain financially troubled corporations  the opportunity to restructure their affairs in an orderly and Court-supervised process.  This presents an opportunity for a company (for instance) to address a major event that has occurred that materially impacts its business  and generally provides a stable platform for Norther Pulp Nova Scotia (“NPNS”) to take steps to restructure its business.

Which companies are filing for CCAA?

NPNS and its associated companies are filing for CCAA; this includes Northern Timber Nova Scotia, Northern Resources Nova Scotia, and other associated companies (collectively referred to as “NPNS”).   The filing does not impact any of the other Paper Excellence Canada entities.

Is NPNS bankrupt?

No. NPNS is not bankrupt and will continue its ordinary course operations during the CCAA proceedings.

Why did NPNS file for CCAA?

Decisions made by The Province of Nova Scotia have directly and materially impacted the business and prospects of NPNS.  It faces ongoing liquidity pressures that prevent it from continuing its restructuring efforts outside of a CCAA proceeding.  As a result, NPNS has filed for CCAA protection, to permit it to reorganize its affairs in a structured, transparent and Court-supervised process.

What happens in CCAA filing?

NPNS will focus on resolving issues  relating to the effluent treatment facility, environmental matters, engaging with stakeholders and employees on resuming operations, and assessing and developing plans to make the mill  a viable business on a long-term basis.

How long with CCAA proceedings take to complete?

At this time, it is not possible to say how long the CCAA proceedings will take to complete and will depend on the exact facts and circumstances that apply.  Complex CCAA cases in Canada generally last between six months and two years but everything depends on the precise facts of each case.

Who is the Monitor?

Ernst & Young Inc. is the Monitor.  Experienced professionals from the Monitor will be working with the Company throughout the CCAA process. 

What is the role of the monitor?

The Monitor is an independent third-party. The Monitor is appointed by and serves as an officer of the Court to oversee the CCAA proceedings.  The Monitor also maintains a website where you can find further information on the CCAA proceedings.  The Monitor’s website is located at:

www.ey.com/ca/northernpulp.

Who is now in charge of NPNS?

The NPNS Board of Directors and management team remain in control of the day-to-day operations of the business.The Court-appointed Monitor plays a supervisory role.  The Monitor does not directly operate NPNS or its business.

What does the filing mean for NPNS operations?

NPNS will continue its operations in the ordinary course during the restructuring process.  The NPNS Board of Directors and management team remain in control of the day-to-day operations of the business, as described above. 

Does NPNS have sufficient financing to complete its hibernation and environmental monitoring activities?

NPNS has sufficient cash to continue hibernation and to continue with environmental processes for a period of approximately one month.  NPNS intends to apply for interim financing in the CCAA proceedings so as to provide it with sufficient funding to complete hibernation.

Is NPNS required to comply with the government orders (e.g. May 14, 2020 Ministerial Order) during CCAA proceedings?

Although NPNS has appealed the Ministerial Order, the Mill intends to perform its legal obligations.

How does this affect the Effluent Treatment Facility (ETF) Environmental Assessment process?

The Environmental Assessment Process relating to the ETF has been paused to allow further discussions with stakeholders. The CCAA filing does not affect that decision.

Does this mean the Mill will not be restarting?

NPNS is committed to the restarting the Mill, as described above.

CCAA FAQ
EMPLOYEES
Do I continue to report to work during CCAA proceedings?

Yes, NPNS will continue its operations in the ordinary course.  If you are presently working, please continue to report to work in the usual manner and at the usual times, unless directed otherwise.

Why wasn’t I informed earlier that this was happening?

Restructuring proceedings are extremely sensitive and must remain confidential until the public CCAA filing occurs.  Only individuals directly required to develop the Court materials and to prepare for the CCAA proceedings were aware prior to the filing.

How will I be paid my wages/salary going forward?

Wages and salary will continue to be paid in the ordinary course for services performed during the CCAA proceedings.  You will be paid your ordinary wages or salary, on the same terms and dates as applied prior to the CCAA filing.

I am owed wages up to the filing date. Will I be paid? What about my unpaid expenses?

Yes, wages will continue to be paid to employees who continue to work on the normal course, in accordance with normal payroll practices.  Expenses incurred and submitted in accordance with NPNS policy will be reimbursed.

How will my vacation entitlements, including vacation payout, be affected?

Your vacation entitlements will not be affected, and will remain unchanged during the CCAA process.

Will my benefits package continue?

Yes, NPNS plans to honor employee benefits packages during the CCAA process, subject to Court approval.

Will I still be entitled to Workers Compensation Board (WCB) top-up?

Yes, WCB top-up will payments for eligible employees will continue during the CCAA process, subject to Court approval.

Will my weekly indemnity payments be impacted?

Weekly indemnity payments for eligible employees will continue during the CCAA process, subject to Court approval.

Will I still receive Long-term Disability (LTD) payments?

Yes, LTD payments for eligible employees will continue during the CCAA process, subject to Court approval.

Are there going to be layoffs because of the CCAA filing?

At present, there are no additional layoffs contemplated due to the CCAA filing.  In the event that there are any additional layoffs, NPNS will communicate directly with those affected by the layoffs.

How does the CCAA filing affect the Collective Bargaining Agreement?

The CCAA does not affect the collective bargaining agreement.  NPNS will remain subject to the terms of the collective bargaining agreement during the CCAA proceedings.

What do I do if I have a grievance during the CCAA proceedings?

The union continues to represent its members.  If you have a grievance, please speak to your union representative.

Will the union be involved in the restructuring?

Yes, the union and NPNS employees are each key stakeholders in the CCAA proceedings.  NPNS will continue to negotiate and consult with the union.

How will I be kept informed of developments during the proceedings?

NPNS leadership will periodically update all employees on key developments during the CCAA proceedings.  Additional information, including copies of any Court Order within the CCAA proceedings, is available on the Monitor’s website at: www.ey.com/ca/northernpulp.

What does the CCAA filing mean for the NPNS pension plan and their assets?

The NPNS pension plans currently remain intact.  The CCAA Initial Order allows NPNS to continue to make normal contributions to the registered pension plans in respect of ongoing service for active employees and NPNS intends to make such contributions.   

Will NPNS continue to make payments to my pension plan?

Yes, the CCAA Initial Order permits NPNS to make regular contributions in respect of ongoing service for active employees to the pension plans. NPNS has determined that, based on December 31, 2019 valuations, it made excess pension contributions in early 2020.  As a result, no contributions to the Plans will be required until late Fall, 2020, and NPNS intends to resume contributions at that time, subject to Court approval.

How does CCAA filing affect my salary continuation?

Your salary continuation is not affected by the CCAA filing, subject to Court approval.

How does CCAA filling affect my second severance payment?

NPNS will be seeking authorization from the Court to make the second severance payment at a subsequent hearing.

Will I receive my second severance payment?

If NPNS receives authorization to make the second severance payment, you will receive payment in the ordinary course.

Can I retire during the CCAA proceedings?

There is no restriction on the ability of employees to retire due to the CCAA filing.

CCAA FAQ
PENSIONERS
Will there be any impact on the amount of the pension payments I receive?

No, if you receive pension payments you will continue to do so in the ordinary course.

Will there be any impact on my health benefits?

No, if you receive health benefits you will continue to do so in the ordinary course.

I am entitled to a defined contribution pension, is the pension money in my member account at risk?

No.  Money in your member account is separate from the general assets of NPNS.

Is NPNS current on the Company and employees’ portion of the defined contribution pension payments?

Yes, NPNS has made all required contributions for the employees’ portion of the defined contribution pension plans.

Are the NPNS defined benefit pension plans underfunded?

Yes, the NPNS defined benefit pension plans are currently underfunded.

Why are the defined benefit plans underfunded?

Pension plan assets are invested by the plans’ fund managers.  The downturn in financial markets has meant that pension assets have lost value and the decline in the interest rates used in the valuation of pension plans has increased the liabilities calculated under the defined benefit plans.  As a result, the defined benefit plans show a deficit.  It is important to note, however, that it is not uncommon for pension plans to be underfunded and Canadian pension benefits standards legislation specifically contemplates this possibility.

Can I take out the commuted value of my defined benefit pension?

The CCAA proceedings will not affect your ability to make an election to transfer the commuted value of your pension.  The pension plan text outlines the conditions for transferring the communted value.

Does NPNS intend to wind-up any of its pension plans as part of the CCAA process?

At this time, NPNS does not intend to wind-up any of its pension plans.

If all or a portion of NPNS is sold to another organization, what happens to the pension plans? Would the purchaser be responsible for maintaining the same pension plans or could the plans’ rules or theNPNS contributions change?

No sale transaction is contemplated by NPNS at this time.  If there is a sale transaction, issues with respect to the pension plans will be negotiated between NPNS, the purchaser and pension beneficiaries.

Who can I contact about my pension?

If you have questions about your pension, you should contact your pension administrator.  

The Nova Scotia pension regulator is the Pension Regulation Division of the Finance and Treasury Board, which may be contacted at the following address:

Mailing Address:

Finance and Treasury Board

Pension Regulation Division

PO Box 2531

Halifax, NS  B3J 3N5

Phone:

902-424-8915, weekdays 8:30 - 4:30.

Fax:

902-424-5327

Email:

pensionreg@novascotia.ca

What do I do if I have other questions?

For questions regarding ordinary course business, you should continue to speak to your regular contact person in human resources.  

For questions relating to the CCAA proceedings, the Monitor can be contacted at 604-891-8491.

 

Additional information is also available on the Monitor’s website at: www.ey.com/ca/northernpulp.

CCAA FAQ
SUPPLIERS
I have unpaid invoices for products/services delivered prior to the CCAA filing. How do I file a claim for amounts outstanding?

If it is determined that a claims process is appropriate, a procedure for the filing of claims will be approved by the Court at a future date in the proceedings. 

Do I continue dealing with my existing contact(s) at NPNS?

Yes, you should continue to deal with your regular contacts at NPNS.

Do I have to continue to provide goods/services to NPNS?

The CCAA Order provides that anyone having an existing written or oral agreement to provide goods or services to NPNS is prohibited from terminating such arrangements, provided that NPNS pays the agreed prices or charges for such goods or services.  You are not required to allow NPNS to purchase goods on credit, and may require Cash on Delivery terms if necessary.

Can I pick-up tools or equipment belonging to my company that are at a NPNS site involved in the CCAA filing?

Yes, property belonging to another person may be removed from NPNS sites.  You should first contact both NPNS and the Monitor, prior to removing any such property, to arrange for pickup.

Do I have to sign a new contract with NPNS for up-coming services or product I am providing?

No, you do not have to sign a new contract with NPNS.  The existing NPNS contracts will generally continue on their current terms, subject to any further Court order within the CCAA proceedings.

How can I keep informed on developments during the proceedings?

The Monitor’s website contains up-to-date information on the CCAA proceedings generally, including copies of any Court orders, the Monitor’s written reports to the Court, and certain other legal and business-related materials.  The website will be periodically updated in light of any key developments.

The Monitor’s website is located at: www.ey.com/ca/northernpulp.

What do I do if I have other questions?

For questions regarding ordinary course business, you should continue to speak to your regular contact person at NPNS.  For questions relating to the CCAA proceedings, the Monitor can be contacted at 604-891-8491. Additional information is also available on the Monitor’s website at: www.ey.com/ca/northernpulp.

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Richmond, British Columbia
V7B 1C3

Phone: 604.247.4400

Fax: 604.247.0512

Email: info@paperexcellence.com

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