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I ~fl’ —
COURT FILE NUMBER 1601-06759 1i—ICOURT OF QUEEN’S BENCH OF ALBERTA
JUDICIAL CENTRE CALGARY
PLAINTIFF ALBERTA TREASURY BRANCHES
DEFENDANT CHINOOK PIPELINE INC., CHINOOK PIPELINELIMITED PARTNERSHIP, CHINOOK PIPELINE LTD.,AND 1466264 ALBERTA LTD.
APPLICANT KPMG INC., IN ITS CAPACITY AS COURT-APPOINTEDRECEIVER AND MANAGER OF CHINOOK PIPELINEINC., CHINOOK PIPELINE LIMITED PARTNERSHIP,CHINOOK PIPELINE LTD., AND 1466264 ALBERTALTD.
DOCUMENT SECOND REPORT TO THE COURT SUBMITTED BYKPMG INC., IN ITS CAPACITY AS COURT-APPOINTEDRECEIVER AND MANAGER OF CHINOOK PIPELINEINC., CHINOOK PIPELINE LIMITED PARTNERSHIP,CHINOOK PIPELINE LTD., AND 1466264 ALBERTALTD. DATED OCTOBER 7, 2016
ADDRESS FOR SERVICE AND KPMG INC.CONTACT INFORMATION OF 3100,205—S Ave. S.W.PARTY FILING THIS DOCUMENT Calgary, Alberta T2P 4B9
Att: Neil Honess/Cecil CheveldaveTelephone: 403-691-8014/250-314-5965Facsimile: 403-691-8008Email: nei1honess(~kpm~.ca
ccheveldave~kpm~.ca
MCCARTHY TETRAULT LLPSuite 4000, 421 7th Avenue SWCalgary, Alberta T2P 4K9Att: Sean Collins/Walker MacLeodTelephone: 403-260-3531/403-260-3710Facsimile: 403-260-3501Email: scollins(~mccarthv.ca
wmacleod(~,mccarthy.ca
Table of Contents
1. INTRODUCTION AND PURPOSE OF REPORT 2
2. PROPERTY TRANSFERS 5
3. BANKRUPTCY 7
4. FINANCIAL DIFFICULTIES OF CHINOOK PIPELINE 8
5. OUTLINE OF SALES PROCESS 10
6. RELATIONSHIP OF TRANSFEREES AND CHINOOK PIPELINE GROUP 12
Listing ofAppendices
Appendix “A” -
Appendix “B” -
Appendix “C” -
Appendix “D” -
Appendix “E” -
Appendix “F”
Appendix “G”
Appendix “H”
Appendix “I”
Freezing Order dated September 13. 2016
Certificate of Appointment — Bankruptcy of Chinook Pipeline Inc.
Statement of Affairs — Chinook Pipeline Inc.
Intact Agreement
Aged Accounts Payable listing as at December 1, 2015 — Chinook Pipeline LimitedPartnership
- Chinook Pipeline — Draft Management Discussion & Analysis document
- Chinook Pipeline Inc. and Chinook Pipeline Limited Partnership unauditedinternal Balance Sheets as at December 10, 2015
- Chinook Pipeline Inc. and Chinook Pipeline Limited Partnership unauditedinternal Balance Sheets as at March 1, 2016
• Aged Accounts Payable listing as at April 1, 2016 for amounts owing to Craig LawLLP and specific invoices
1. INTRODUCTIONAND PURPOSE OFREPORT
Introduction
1. Chinook Pipeline Inc., Chinook Pipeline Limited Partnership, Chinook Pipeline Ltd. and 1466264
Alberta Ltd. (“Chinook Pipeline” or the “Group”) carried on the business of civil and municipal
pipeline installation and construction throughout Alberta and Saskatchewan. The Group’s principal
assets include heavy duty machinery, pipeline laying equipment, light duty pickup trucks and real
estate. All assets are located in Alberta.
2. The main operating entity of Chinook Pipeline was Chinook Pipeline Limited Partnership
(“CPLP”), which carried out day to day business operations of the Group including entering into
construction contracts and carrying out construction projects.
3. Chinook Pipeline Inc. (“CPI”) owned construction equipment, which was made available to CPLP
to carry out construction projects. In addition to construction equipment CPI was the registered
owner of seven parcels of real estate.
4. Chinook Pipeline Ltd. was the general partner of CPLP.
5. 1466264 Alberta Ltd. was the limited partner of CPLP.
6. The Group’s primary secured lender is Alberta Treasury Branches (“ATB”) who has advanced
funds of approximately $12.6 million (plus interest and fees). These amounts were borrowed by
Chinook Pipeline pursuant to the amended facility agreements between ATB and Chinook Pipeline
dated September 1, 2015 and January 8, 2016 (the “Facility Agreements”).
7. As a result of the sharp decline in the Alberta economy and challenges with various construction
projects, the Group experienced significant financial difficulties in 2015 and was unable to perform
its commitments to ATB.
8. On April 27, 2016, ATB issued a demand for payment and notice of intention to enforce security
(the “ATB Notice”) pursuant to Section 244 of the Bankruptcy and Insolvency Act (“BIA”).
9. On May 27, 2016 (the “Receivership Date”), an application was made to appoint KPMG Inc.
(“KPMG”) as receiver and manager of Chinook Pipeline (the “Receiver”) pursuant to section 243
of the BIA and section 13(2) of the Judicature Act, RSA 2000, c J-2 to, inter a/ia, take possession
Page 2
of and exercise control over the assets of the Group (including the shares and partnership units of
the Group) and any and all proceeds, receipts and disbursements arising out of or from the assets
(the “Property”).
10. On May 27, 2016, the Court of Queen’s Bench of Alberta (“Court”) issued an order appointing
KPMG as the Receiver over all of the Property and undertakings of Chinook Pipeline (the
“Order”).
11. On September 26, 2016, CPI made an assignment for the general benefit of its creditors pursuant
to section 49 of the BIA and KPMG was appointed as trustee in bankruptcy of CPI (in such
capacity, the “Trustee”). This report (the “Second Report”) is filed by KPMG in its capacity as
both Receiver of the Chinook Group and Trustee of CPI and references to the Receiver herein shall
include both the Receiver and the Trustee where appropriate.
12. For further background information on Chinook Pipeline and these receivership proceedings please
refer to the Receiver’s website www.kpm g.calchinookpipeline.
13. In preparing this report, the Receiver has been provided with, and has relied upon, unaudited and
other financial information, books and records (collectively, the “Information”) prepared by the
Group and/or their representatives, and discussions with the Group’s management and/or
representatives. The Receiver has reviewed the Information for reasonableness, internal
consistency and use in the context in which it was provided and in consideration of the nature of
evidence provided to this Honourable Court. However, the Receiver has not audited or otherwise
attempted to verify the accuracy or completeness of the Information in a manner that would wholly
or partially comply with Canadian Auditing Standards (“CAS”) pursuant to the Chartered
Professional Accountants Canada Handbook and, accordingly, the Receiver expresses no opinion
or other form of assurance contemplated under the CAS in respect of the Information.
14. The information contained in this report is not intended to be relied upon by any prospective
purchaser or investor in any transaction with the Receiver.
15. All references to monetary amounts in this report are in Canadian dollars unless otherwise
specified.
Page I 3
Purpose of the Report
16. This Second Report is tiled to provide this Honourable Court an update on matters since the first
report of the Receiver dated September 9, 2016 (the “First Report”) and provides information
concerning the financial affairs of CP1 and CPLP on or around the time that certain transfers of real
estate were initiated.
17. Defined terms not defined herein have the same meaning as defined in the First Report.
Page I 4
2. PROPERTY TRANSFERS
1 8. On the Receivership Date, CPI was the registered owner in fee simple of seven parcels of real estate
as summarized in the table below and described in more detail in the First Report.
Parcel Reference Description
I Vacant Residential Lot — Pincher Creek, Alberta
2 Equipment Yard — Pincher Creek, Alberta
3 Commercial Building and Land (Chinook offices) Pincher Creek,Alberta
4 Vacant Residential Lot — Pincher Creek, Alberta
5 Vacant Residential Lot — Pincher Creek, Alberta
6 Vacant Land — Crowsnest Pass, Alberta
7 Land and Vacant Residential Building — Lamont County, Alberta
19. During the process of registering the Receiver’s interest on title in accordance with paragraph 3(o)
of the Receivership Order, it was discovered that four of the parcels had been conveyed to third
parties subsequent to the Receivership Date:
a) Parcels 4 and 5 were conveyed to 573935 Alberta Limited (“573 Alberta”) on August 20,
2016;
b) Parcel 6 was conveyed to 1182134 Alberta Ltd. (“118 Alberta”) on August 25, 2016; and
c) Parcel 7 was conveyed to Ms. Cavell Craig on August 25, 2016 (together, the
“Transfers”).
20. The Receiver views the completion of the Transfers - subsequent to the Receivership Date and
without the consent of the Receiver or the approval of this Honourable Court - as a violation of the
provisions of the Order.
21. Accordingly, the Receiver made application to this Honourable Court to obtain a freezing order to
preserve and protect these parcels pending determination of the rights of Chinook Pipeline.
Page I 5
22. On September 13, 2016, the Court issued an order freezing the transfer of certain of the property
parcels to third parties in breach of the Receivership order (the “Freezing Order”). A copy of the
Freezing Order is attached as Appendix “A”.
23. The Freezing Order prevented the transferees of the four parcels from:
a) Further selling, transferring, leasing, conveying, assigning, encumbering, mortgaging,
charging, pledging or similarly dealing with their interests in the transferred land parcels,
if any;
b) Instructing, requesting, counselling, demanding, or encouraging any person to sell,
transfer, lease, convey, assign, encumber, mortgage, charge, pledge or similarly deal with
their interests in the transferred land parcels, if any; and
c) Facilitating, assisting in, aiding, abetting, or participating in any acts the effect of which is
to cause or complete a sale, transfer, lease, conveyance, assignment, encumbering,
mortgaging, charging or pledging their interest in the transferred land parcels, if any.
Page I 6
3. BANKRUPTCY
24. CPI owned all the Groups’ real estate at the Receivership Date.
25. Pursuant to paragraph 3(s) of the Order and to preserve the Trustee in Bankruptcy’s right to pursue
its remedies tinder sections 95 and 96 of the BIA, the Receiver assigned CPI into bankruptcy on
September 26. 2016. A copy of Certificate of Assignment is attached hereto as Appendix “B”.
26. The Statement of Affairs (BIA Form 78) is attached hereto as Appendix “C” and is summarized
as follows:
Total estimated realizable value of assets $4,932,000
Total estimated value of liabilities ($12,769,539)
Total estimated deficiency ($7,837,539)
27. The first meeting of creditors in the bankruptcy of CPI is scheduled to take place on October 17,
2016.
Page 7
4. FINANCIAL DIFFICUL TIES OF CHINOOK PIPELINE
28. During the fall of 2015, CPLP was experiencing financial difficulties and cash flow constraints as
described below:
a) One of Chinook Pipeline’s significant projects was the Saskatoon Southeast Water Supply
System — Zelma East Pipeline Install project (the “Saskwater Project”). The Saskwater
Project was an approximate $33 million dollar project that Chinook Pipeline commenced
in 2012. The Saskwater Project was bonded with a performance bond and a material
payment bond provided by Intact Insurance Company (“Intact”). Chinook Pipeline entered
into an agreement with Intact in November 2015 whereby Intact would provide the
financial assistance Chinook Pipeline required to enable Chinook Pipeline to complete
work on The Saskwater Project. A copy of the agreement (the “Intact Agreement”) is
attached hereto as Appendix “B”;
b) According to Chinook Pipeline’s internal accounting records, CPLP owed $6,292,212 in
accounts payable as at December 1, 2015. Of this amount, $5,694,223 (91%) was more
than 90 days overdue. A copy of the aged accounts payable report as of December 1, 2015
is attached hereto as Appendix “E”;
c) In October 2015, a draft Management Discussion and Analysis (“MBA”) document was
prepared by Chinook Pipeline outlining the challenges being experienced at that time. As
indicated in the MDA, Chinook Pipeline identified liquidity and financial challenges
(including meeting covenants) and the decreasing amount of contract work. The MDA is
attached hereto as Appendix “F”; and
d) CPI and CPLP periodically generated internal balance sheets based on the accounting
software used by the Chinook Group. The Receiver used Chinook Group’s accounting
software to generate balance sheets for CPI and CPLP showing both the assets and
liabilities of CPI and CPLP as of the date of the Transfers attached hereto as Appendix
“G” and Appendix “H” respectively (collectively, the “Balance Sheets”). The Balance
Sheets show the accrued liability owned by CPI and CPLP on its obligations to ATB as of
the date of each of the Transfers, the book value of CPI’s and CPLP’s assets (as recorded
by CPI and CPLP) and the estimated market value of CPI’s and CPLP’s assets based on
various marketing efforts (such efforts are described below) undertaken subsequent to the
Page 8
Receivership Date. The Balance Sheets show both CPI and CPLP had significant deficits
at the date of the Transfers.
Page I 9
5. OUTLINE OFSALES PROCESS
Equipment
29. Given the nature of the equipment, the Receiver determined that an auction proposal would be the
most appropriate sales process to maximize realizations.
30. The Receiver developed a Request for Proposal (“RFP”) process to solicit offers from prospective
liquidators to conduct a liquidation program of the equipment.
31. The specifics of the RFP process included:
a) Development of a comprehensive RFP package including equipment listings;
b) Identification of prospective liquidation service providers;
c) Issuance of the RFP package; and
d) Coordination of site visits and site tours of the equipment.
32. The RFP process implemented for the liquidation of Chinook Pipeline’s equipment was as follows:
a) Ten prospective services providers (the “RFP Parties”) were identified from across
Canada and the United States;
b) The RFP materials were developed and the RFP Parties were provided a RFP package on
August 19, 2016; and
c) The deadline for written offers to be received was September 9, 2016 at 5pm Mountain
Standard time (“Submission Deadline”).
33. The Receiver was also open to proposals from parties other than the RFP Parties.
34. Seven RFP Parties visited Chinook Pipeline’s property to view the equipment, and six proposals
were being submitted to the Receiver on or before the Submission Deadline.
35. One party outside of the RFP Parties submitted an offer after the Submission Deadline.
Page 10
36. As of the date of this report, the Receiver is yet to finalize an agreement for the sale of the
equipment; however, the Receiver is of the view that the proposals submitted reflect the estimated
range of market values of CPI’s equipment.
Real Estate
37. The Receiver is also reviewing proposals from realtors for the realization of Chinook Pipeline’s
property.
Pagef 11
6. RELA TIONSHIP OF TRANSFEREES AND CHINOOKPIPELINE GROUP
38. In paragraphs 17 and 20-22 of the First Report, the Receiver advised this Honourable Court of the
information then known to it in respect of the Transfers. The Receiver has updated this information
below based on its further review of the books and records of the Chinook Group.
573 Transfer
39. Attached hereto as Appendix “I” is an aged accounts payable report from CPLP dated April 1,
2016 listing amounts owing to Craig Law LLP along with specific invoices located in Chinook
Pipeline’s files.
40. The aged accounts payable report indicates $22,642.04 owed to Craig Law LLP, of which
$19,670.68 (approximately 87%) was more than 90 days overdue. The Receiver notes that certain
of these invoices, totalling $6,493, were issued to non-Chinook Pipeline entities, but were recorded
and accounted for in CPLP’s accounting records. These particular invoices include the following:
Entities Date of Invoice AmountMr. Archie Craig 20-Jul-15 5,659.60Christie Ridge Enterprises Inc. 31-Dec-15 224.18Christie Ridge Enterprises Inc. 13-May-15 203.18Christie Environmental Inc. 2-Sep-15 203.18Chinook Construction Inc. 28-Jul-15 203.18Total 6,493.32
118 Transfer
41. To date, the Receiver has been unable to locate any documentation to demonstrate that Mr. Irwin
or 118 Alberta is a creditor of Chinook Pipeline.
Cavell Craig Transfer
42. To date, the Receiver has been unable to locate any documentation to demonstrate that Cavell Craig
is a creditor of Chinook Pipeline.
* * *
Page 112
Craig Law LLP Invoices issued to non Chinook Pipeline entities
All oF which is respectfully submitted this 7th day oFOctober, 2016.
KPMG INC.,COURT-APPOINTEI) RECEIVERAND MANAGER OF CHINOOK PIPELINE INC.,CHINOOK PIPELINE LIMITED PARTNERSHIP,ChINOOK PIPELINE LTD., AND 1466264 ALBERTA LTD.AND TRUSTEE IN BANKRUPTCY OF CHINOOK PIPELINE INC.and not in its personal capacity
/1/
Per: ~ HoriessSenior Vice President
Per: CF. (Cecil) CheveldaveVice President
Page I ~I3
A
Appendix A
Freezing Order dated September 13, 2016
COURT FILE NUMBER 1601-06759
COURT OF QUEENS BENCH OFALB E RTA
CALGARY
IN THE MATTER OF THE BANKRUPTCYAND INSOLVENCY OF CHINOOKPIPELINE INC., CHINOOK PIPELINELIMITED PARTNERSHIP, CHINOOKPIPELINE LTD., and 1466264 ALBERTA I hereby cerfl1~t this to be a true copy o~LTD.
ALBERTA TREASURY BRANCHES
CHINOOK PIPELINE INC., CHINOOKPIPELINE LIMITED PARTNERSHIP,CHINOOK PIPELINE LTD., and 1466264ALBERTA LTD.
the original ~. GT(1~1
DOCUMENT
ADDRESS FORSERVICE ANDCONTACTINFORMATION OFPARTY FILING THISDOCUMENT
ORDER (Interim Injunctive Relief)
McCARTHY TETRAULT LLPBarristers & SolicitorsSean F. Collins/Walker W. MacLeadSuite 4000, 421-7th Avenue S.W.Calgary AB T2P 4K9Phone:403-260-3531/403-260-371 0Fax: 403-260-3501Email: scollins~mccarthy.ca
UPON THE APPLICATION by KPMG Inc. in its capacity as the court-appointed receiver
and manager (the Receiver”) of the undertakings, property, and assets of Chinook Pipeline Inc.
pursuant to the order issued by this Honourable Court on May 27, 2016 (the “Receivership
Order”): AND UPON reading the First Report of the Receiver, dated September 9, 2016 (the “First
COURT
JUDICIAL CENTRE
APPLICANT
RESPONDENT
Dated thisJ~~?day of~f~- 2L~
DATE ON WHICH ORDER WAS PRONOUNCED:
LOCATION WHERE ORDER WAS PRONOUNCED:
NAME OF JUSTICE WHO MADE THIS ORDER:
September 13, 2016
Calgary, Alberta
Justice AD. Maclead
Receiver’s Report”), filed: AND UPON reading the Affidavit of Service of Katie Doran, sworn
-2-
September 12, 2016 (the “Affidavit of Service”); AND UPON HEARING the submissions of
counsel for the Receiver, for Alberta Treasury Branches (“ATB”) and for 573935 Alberta Limited
and Craig Law LLP and for 1182134 Alberta Ltd., Mr. Drew Irwin and Ms. Cavell Craig;
1. For the purposes of this Order, the following terms shall have the following meanings:
(a) “Lands” shall mean the real property identified in Schedule ‘A” to this Order;
(b) “Person” shall have the meaning ascribed to it in the Receivership Order; and
(c) “Respondents” shall mean each of 573935 Alberta Limited, Craig Law LLP,
1182134 Alberta Ltd., Mr. Drew Irwin and Ms. Cavell Craig.
2. It is hereby ordered and declared that each of the Respondents and each of their servants,
employees, agents, assigns, solicitors or any other Person acting on their behalf or in conjunction
with them are enjoined, estopped and prevented from:
(a) selling, transferring, leasing, conveying, assigning, encumbering, mortgaging,
charging, pledging or similarly dealing with their interest in the Lands, if any;
(b) instructing, requesting, counselling, demanding, or encouraging any Person to sell,
transfer, lease, convey, assign, encumber, mortgage, charge, pledge or similarly
deal with their interest in the Lands, if any; and
(c) facilitating, assisting in, aiding, abetting, or participating in any acts the effect of
which is to cause or complete a sale, transfer, lease, conveyance, assignment,
encumbering, mortgaging, charging or pledging of their interest in the Lands, if any.
3. The registrar of titles (the “Registrar”) under the Land Titles Act (Alberta) (the “LTA”) is
hereby ordered and directed to forthwith register a copy of this Order on title to the Lands and
notwithstanding the requirements of Section 191(1) of the LTA.
4. The application filed by the Receiver on September 9, 2016 (the “Application”) shall be
heard in accordance with a schedule to be set by agreement between the Receiver, the
Respondents and ATB or by further order of this Honourable Court. The issuance of this Orderwill
-3-
be without prejudice to the position taken by any Person including, without limitation, the Receiver,
ATB and the Respondents on the merits of the Application.
5. Each of the Receiver, ATB, the Respondents and any other interested Person has leave to
apply to vary, amend, modify or otherwise alter any term or provision of this Order including, without
limitation, the relief provided for in paragraph 2 of this Order.
6. Service of this Order on ATB and on each of the Respondents by email, facsimile, courier,
registered mail, regular mail or personal delivery shall constitute good and sufficient service of this
Order.
J.C~Q~B.A.
-4-
SCHEDULE “A”
LANDS
PLAN 0811978BLOCK 5LOT 27EXCEPTING THEREOUT ALL MINES AND MINERALSESTATE: FEE SIMPLEATS REFERENCE: 4;30;6;22:NEMUNICIPALITY: TOWN OF PINCHER CREEKREFERENCE NUMBER: 121 187 051
PLAN 0811978BLOCK 5LOT 28EXCEPTING THEREOUT ALL MINES AND MINERALSESTATE: FEE SIMPLEATS REFERENCE: 4;30;6;22;NEMUNICIPALITY: TOWN OF PINCHER CREEKREFERENCE NUMBER: 121 187 051 ÷1
PLAN 0824507BLOCK 1LOT 2EXCEPTING THEREOUT ALL MINES AND MINERALSAREA: 2.02 HECTARES (4.99 ACRES) MORE OR LESSESTATE: FEE SIMPLEATS REFERENCE: 4;18;53;27;NEMUNICIPALITY: LAMONT COUNTYREFERENCE NUMBER: 122 061 736
PLAN 8210039BLOCK 2CONTAINING 4.41 HECTARES (10.9 ACRES) MORE OR LESSEXCEPTING THEREQUT ALL MINES AND MINERALSATS REFERENCE: 5;5;8;10:SEESTATE: FEE SIMPLEMUNICIPALITY: MUNICIPALITY OF CROWSNEST PASSREFERENCE NUMBER: 141 261 057
B
Appendix B
Certificate of Appointment — Bankruptcy of Chinook Pipeline Inc.
I Industry Canada Industrie CanadaOffice of the Superintendent Bureau du surintendantof Bankruptcy Canada des faillites Canada
District of: AlbertaDivision No.: 02 - CalgaryCourt No.: 25-2169893Estate No.: 25-2169893
In the Matter of the Bankruptcy of:
Chinook Pipeline Inc.Debtor
KPMG INC.Licensed Insolvency Trustee
Ordinary Administration
Date and time of bankruptcy: September 26, 2016, 13:13 Security: $0.00
Date of trustee appointment: September26, 2016
Meeting of creditors: October 17, 2016, 16:00Ramada Hotel1132 Table Mountain StreetPincher Creek, AlbertaCanada,
Chair: Trustee
CERTIFICATE OF APPOINTMENT - Section 49 of the Act: Rule 85
I, the undersigned, official receiver in and for this bankruptcy district, do hereby certify that:- the aforenamed debtor filed an assignment under section 49 of the Bankruptcy and Insolvency Act;- the aforenamed trustee was duly appointed trustee of the estate of the debtor.
The said trustee is required:- to provide to me, without delay, security in the aforementioned amount;- to send to all creditors, within five days after the date of the trustee’s appointment, a notice of the bankruptcy;
and- when applicable, to call in the prescribed manner a first meeting of creditors, to be held at the
aforementioned time and place or at any other time and place that may be later requested by the officialreceiver.
Date: September 26, 2016, 15:16E-FilelDépOt Electronique Official Receiver
Standard Life Tower, 639 5 Avenue SW, Suite 400, Calgary, Alberta, Canada, T2POM9, (877)376-9902
Canaa
C
Appendix C
Statement of Affairs — Chinook Pipeline Inc.
Alberta02. Calgaty ~Original []Amended
-.Form7B--Statement of Affairs (Business Bankruptcy) made by an entity
(Subsection 49(2> and Paragraph 158(d) of the Act/ Subsections 50(2) and 62(1) of the Act>
In the matter of the bankruptcy ofChinook Pipeline Inc.
of the Town of Pincher Creek, in the Province of AlbertaTo the bankrupt:
You are required to carefully and accurately complete Ibis tarm and the applicable attachments showing the stale of your affairs on the date of the bankruptcy, on the26th day of September 2016. When completed, this form and the applicable attachments wilt constitute the Statement of Affairs and must be yenned by oath or solemndeclarahon,
LIABILITIES(as stated and esfimaled by the officer)
1. Unsecured credulors as per list A
Ba’ance of secured claims as per list ‘B”
Total unsecured creditors
2 Secured creditors as per list “9”
3 Preferred creditors as per list C”
4. Contingent, trust claims or other liabilities as per list Destimated lobe reclaimable for
Total liabilities
Surplus
ASSETS(as slated and eshmated by the otficer(
1. Inventory
2. Trade fixtures, etc
3. Accounts receivable and other receivables, as per list E
Good 0.00
Doublful 0.00
Bad 0.00
Estimated to produce
4. Bills of enchange. promissory note, etc.. as perils
5. Deposits in financial institutions
6. Cash7. Livestock
8. Machinery, equipment and plant
9. Real property or immovable us per list ‘0”
10. Fureilure
11. RRSPo, RRIFs, life insurance, etc12. Securities (shares, bonds, debentures, etc.)
13, Inlerests under wills
14. Vehicles
15. Other property, as perils
It bankrupt is a corporalion, add:
Amountof subscribed capital 0.00
Amount paid on capital 000
Balance subscribed and unpaid
Estimated to produce
Total assets
Deficiency
District of:Di~ision No.Court No.Estate No.
tOO
8.237,538.19
8.237,539. 19
4,532,000.00
0.00
0.00
12,769,539.19
tilL
000
000
0.00
0.00
0.00
000
0.00
3,500,000.00
1.032.00000
0.00
0 CO
0.00
000
0.00
400,000.00
0.00
000
4.932,000.00
7,837,539.19
I, KPMG Inc., Receiver & Manager for Chinook Pipeline Inc., of the Town of Pincher Creek in Ike Province of Alberta, do swear (or solemnly declare) that thisstatement and the anactred lists are to the best of my knowledge, a full, true and complete statement of my affairs on the 26th day of September 2016 and fullydisciese all properly of every description that is in my possession or that may devolve on nrc in uccorstance wilts the Act.
SWORN (or SOLEMNLY DECLARED)betare me at the City of Kamloops in the Province of British Cohimbia, on this 26th day of September 2016.
~ cA ~Sen Bordas, Commissioner of OathsFor the Province of British ColumbiaEnpires Nov. 30. 2018
Geri Lynn BordasA Commissioner for Taking Affidavitsfor the Provkice of British ColumbiaExpiry date: November 30, 2018
Page 1
D
Appendix D
Intact Agreement
THIS AGREEMENT made and effective as of the.~ii day of November, 2015.
BETWEEN:
INTACT INSURANCE CO~PANY
(“Intact”)
OF THE FIRST PART
AND:CHINOOK PIPELINE LIMITED PARTNERSHIP
(“Chinook PLP”)
OF THE SECOND PART
AND:CHINOOK PIPELINE LTD., CHINOOK PIPELINE INC.,1466264 ALBERTA LTD., ARCHIE WILLIAM CRAIG, ANDNOBLE JOHN CRAIG(hereinafter referred to collcctively as the “Indemnitors);
OF THE THIRD PART
WHEREAS:
A. Intact has issued construction bonds (the “Bonds’) on behalf of Chinook PLP including aperformance bond (the “Performance Bond”) and a labour and material payment bond (the “Labourand Material Payment Bond”) in respect of the Saskatoon Souteast Water Supply System, Zelma EastPipeline Install, Section 1 Contract. (the “Bonded Contract”);
B. Chinook i’Ll) and the Indemnitors have granted security to Intact in return for the issuanceof the Bonds as more fully described in the General Application and Indemnity Agreements (the“Indemnity Agreements”) executed by Chinook I’Ll) and the Inden~nitors in favour of Intact datedJanuary 11, 2011 and January 17, 2012, copies of which are attached as Attachment A to thisagreement;
C. Chinook i’Ll’ and the Indemnitors acknowledge that each has a substantial, material andbeneficial interest in the Bonded Contract and in the Bonds issued by Intact on behalf of ChinookPLP in regard to the Bonded Contract;
D. Chinook PU’ has encountered completion issues and cashfiow difficulties on the BondedContract and requires the assistance of Intact to complete the Bonded Contract.
21u987a’
-2-
E. Intact has received notices of potential claims from subcontractors and suppliers to ChinookPLP under its Labour and Material Payment Bond;
F. Chinook PLP and the Indemaitors agree that it is in the best interests of Chinook PLP andthe Indemnitors that Intact provide financial assistance to Chinook PLP to complete the work underthe Bonded Contract using the services of Chinook PLP as general contractor and subcontracting partof the completion work to Hamm Construction Ltd. (“Hamm”) if determined by Intact to benecessary.
C. Intact is prepared to engage the services of Hamm to assist in the completion of the work onthe Bonded Contract if required and pay the amounts properly payable by Chinook PLP to clsi~mrntsor potential claimants without insisting upon strict compliance with all terms and conditions of theLabour and Material Payment Bond on the terms hereinafter set forth;
NOW THEREFORE THIS AGREEMENT WffNESSETH that in consideration of thepremises and the sum of $10.00 now paid by Intact to Chinook PLP and to each of the Indemnitorsand other good and valuable consideration (the receipt and sufficiency of which is acknowledged byeach of Chinook I’Ll’ and the Indemnitors), Chinook PU’ and the Indemnitors do for themselves,their respective heirs, executors, administrators, successors and assigns, jointly and severally herebycovenant and agree with Intact as follows:
1. Chinook PLP and the Indemnitors acknowledge that Chinook PLP requires theassistance of Intact to complete the work on the Bonded Contract and to fund thepayment of amounts properly payable by Chinook PLP to its workers, suppliers andsubcontractors who would be in a position to 61e claims under the Labour and MaterialPayment Bond (the “Claimants”).
2. Chinook PLP and the Indemnitors wish to arrange for the completion by ChinookPLP of its obligations under the Bonded Contract and hereby agree that any and allamounts paid by Intact to complete the work under the Bonded Contract and todischarge the obligations of Chinook I’Ll’ to potential Ch~imants shall, for thepurposes of the Indemnity Agreements be deemed to be damage, loss, costs, chargesand expenses sustained and incurred by reason of Intact’s execution of the Bonds andthat the Indemnity Agreements, shall secure the repayment of all such amountswhether or not
(a) Chinook PLP has defaulted or been properly declared in default of the BondedContract or under the Performance Bond;
(b) any of the Claimants have advanced or perfected a claim or claims under theLabour and Material Payment Bond.
3. Chinook I’Ll’ and the Indemmtors agree that Intact shall have total control of thework required to complete the Bonded Contract and that Chinook I’Ll’ shallimplement all instructions provided by Intact respecting the completion of the BondedContract including, without limitation, all instructions respecting:
(a) the size and composition of the crew to be employed by Chinook PLP;
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(b) the nature and scope of the work to be completed by Chinook PLP and thenature and scope of the work to be completed by Harnm;
(c) the source, quality and quantity of the materials required;
to complete the Bonded Contract having regard to ordinary and prudent constructionpractice.
4. Chinook PLP and the Indemnitors hereby agree to the appointment by Intact ofHamm to complete part of the remaining work on the Bonded Contract
5. Chinook PLP and the Indemnitors hereby consent to Intact providing a Release of theHoldback Bond and/or indemnity Agreement to SaskWater to obtain the early releaseof Hoidhack funds to fund the completion of the work on the Bonded Contract andagree that Chinook PU’ will sign and deliver the Release of Holdback Bond toSaskWater if requested to do so by Intact.
6. Chinook PLP and the Indemnitors each hereby acknowledge and agree that, for thepurposes of the Indemnity Agreements:
(a) all amounts paid to Hamxn in respect of the completion of the work underthe Bonded Contract;
(b) all amounts paid to Claimants pursuant to this Agreement or under the Labourand Material Payment Bond;
(c) all payroll expenses of Chinook paid by Intact;
(d) all costs of any nature or ldnd which intact may incur to satisfy or settle claim~or potential claims or to obtain discharges or the release of the obligations ofIntact under the Bonds; and
(e) all completion costs, legal fees, consultants’ fees, overhead costs or otherreasonable expenses of any nature or kind which Intact may incur under theBonds;
shall be deemed to be damage, loss, costs, charges and expenses sustained and incurredby reason of Intact’s execution of the Bonds and that the Indemnity Agreements, shallsecure the payment of all such amounts.
EXPENSES
7. Chinook PU’ and the Indemnitors acknowledge that Intact has and will continue toincur the following costs, charges and expenses (the “Expenses”):
(a) payments of outstanding accounts payable by Chinook I’Ll’ on the BondedContract, including but not limited to payments to Clalmants under the Labourand Material Payment Bond induding subcontractors, suppliers, workers,
282987L1
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labour contractors, Workers’ Compensation Board assessments and otherstatutory or related duties and assessments;
(b) financing the completion of the Bonded Contract including without limitation,any amounts paid to Haznm during the completion of the Work;
(c) the costs of monitoring the completion of the Bonded Contract;
(d) in retaining experts and consu1t~nts to assist Intact in assessing the surety riskor liability under the Bonds and negotiating with SaskWatez;
(e) in enforcing any covenants and conditions of this agreement; the Bonds andthe Indemnity Agreements; and
(f) generally in connection with matters referred to herein.
8. The Expenses shall include legal fees on a solicitot and own client basis, auditing fees,engineering fees and travel expenditures of Intact and its agents, consultants, advisorsand solicitors respecting the matters referred to in this agreement
9. Chinook PLP and the Indemnitors agree to repay all amounts advanced or paid byIntact and to reimburse Intact for the Expenses upon demand.
10. The Expenses shall constitute debts, liabilities and obligations of Chinook PU’ andthe Jndemnitors to Intact and shall be secured by the Indemnity Agreements.
PAY~&E~~S
11. Chinook PLP and the Indemnitors acknowledge and agree that the amounts paiddirectly by Intact to Chnrm,nts together with any and all amounts paid by Intact toI-Iamm or to Chinook PLP for the completion of the Bonded Contract and theExpenses as provided for in this agreement are paid and incurred in consequence ofthe Bonds issued by Intact on behalf of Chinook PLP and shall be couclusivclypresumed to be a loss thereunder and recoverable under the Indemnity Agreements.
12. Chinook PLP and the Inderenitors hereby waive notice of any default, act, fact orinformation coming to the notice or knowledge of Intact concerning or affecting theirrights or liabilities under this agreement; the Bond and the Indemnity Agreements andacknowledge and agree that Chinook PLP and the Indemnitors shall be and continueto be jointly and severally liable to Intact under the Indemnity Agreements.
13. AU funds advanced by Intact to complete the Bonded Contract, to discharge theobligations of Chinook PLP to Claimants, and all expenses incurred by Intact providedfor in this agreement will be repayable on demand together with interest at the primerate of interest charged from time to time by the Bank of Montreal to its commercialcustomers plus 2.0 % per annum. All funds advanced by Intact pursuant to the termsof this agreement will be used solely for the purposes of assisting Chinook PLP tocomplete the Bonded Contract and to discharge its obligations to sub-contractors andsuppliers who qualify as Claimants under the Labour Material Payment Bond.
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WrYER~O~ DEFENCES
14. Chinook PLP and the lndcmnitors acknowledge and agree that the paymentscontemplated by this agreement are necessary and proper in order to minimize theliability of Chinook PLP and the lndernnitors under the Bonds and the IndemnityAgreements and hereby undertake and agree not to take the position in defence of anyclaim which may hereinafter be advanced by Intact to enforce their obligations underthe Indemnity Agreements that
(a) Chinook PLP was not in default under the Bonded Contract;
(b) the Bonded Contract had not been properly terminated or declared to be indefault by SaskWater;
(c) one or more or all of the subcontractors, material suppliers, workers or otherscapable of advancing claims under the Labout Material Payment Bond had notadvanced or perfected a claim or claims against Intact and/or Chinook PLPunder the Labour and Material Payment Bond;
(d) there was any failure by an obligee identified in the Bond to declare ChinookPLP to be in default or to perfect its claim under the Performance Bond orLabour and Material Payment Bond.
15. Each of Chinook PLP and the Indemnitors hereby acknowledge and agree that theexecution and delivery of this agreement shall in no way prejudice or limit Intact’srights under the Bonds or the Indemnity Agreements and each of Chinook PLP andthe Indeninitors acknowledge and agree that they remain jointly and severally liable toIntact under the Indemnity Agreements.
16. The Indeninitors and each of them do hereby covenant with Intact to guarantee, asprima.zy debtors and not as surety, that Chinook PLP:
(a) will pay all monies payable hereunder and under the Bonds and IndemnityAgreement when due; and
(b) will duly observe, perform and keep all the covenants herein contained orcontained in Bonds and Indemnity Agreement;
and do hereby jointly and severally covenant to indemnify and save harmless Intactfrom any loss, costs or damages from non payment of the said monies or breach ornon performance of any of the said covenants and do further agree that Intact mayarrange with Chinook PLPJ its successors and assigns, to allow monies to be in arrearsand/or may extend the time for payment of any monies or deal with this agreementor the Indemnity Agreements however it may deem fit and all without releasing theIndcmnjtors, their heirs, executors, administrators, successors and assigns from theirobligations hereunder and without notice to them, and Intact shall not be bound toexercise its remedies against any other person before requiring payment of money orperformance of covenants from the Indemnitors or any of them.
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ACKNOWLEDGMENT
17. Chinook PLP and the Indemnitors hereby acknowledge, covenant and agree that:
(a) the provisions of this agreement shall not in any way merge, impede orprejudice in any maimer whatsoever any iights or remedies of Intact, includingwithout limitation, Intact’s right to make a demand for repayment at any time;
(b) the Indemnity Agreements remain in full force and effect notwithstanding theexecution of this agreement;
(c) any waiver by Intact of any breach or breaches hereof or the Bonds or theIndemnity Agreement shall not be deemed nor shall the same constitute awaiver of any subsequent breach or breaches; and
(d) a default under any of the provisions of this agreement or under the Bonds orthe Indemnity Agreements shall, at the option of Intact, be deemed to be adefault under all or any of the Bonds, or the Indemnity Agreements asdetermined by rntact
COOPERATION
18. Chinook PLP and the Indemnitors agree to do everything within their power tocomplete the Bonded Contract at the least, reasonable, possible cost having regard toordinary and prudent construction practice.
19. Chinook PLP and the Indemnitors agree to cooperate and assist Intact and its agentsand will instruct any employees and agents of Chinook PLP to cooperate with andassist Intact and its agents by supplying all information requested and reasonablyrequired by Intact or its agents, by providing Intact and its agents with unrestrictedaccess to their respective books and records and by generally providing suchcooperation and assistance as is required to ensure that the work under the BondedContract Is completed by Chinook PLP in accordance with the terms and conditionsof the Bonded Contract
MISCELLANEOUS PROYISIONS
20. Each of the parties hereto acknowledges that they have entered into this agreement oftheir own free will without any coercion or duress having been imposed upon themby any of the parties to this agreement.
21. Each of the parties to this agreement also acknowledges that they have received, orhad the opportunity to receive, legal advice in respect of this agreement, that thcyknow the contents of it, that they have sufficient capacity to execute this agreementand that in doing so they are acting on their own free will.
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22. This agreement and the rights, benefits and obligations set forth or referred to hereinshall not be assignable by any party hereto without the prior written consent of all ofthe other parties hereto.
23. This agreement shall ensure to the benefit of and be binding upon the parties hereto,and their respective heirs, executors, administrators, successors and assigns.
24. All covenants and obligations of Chinook PLP and the lndemnitors under thisagreement shall be joint and several.
25. This agreement shall be interpreted in accordance with and governed by the laws ofthe Province ofAlberta.
26. The parties hereto undertake and agree to execute such further documents and to takesuch further action as rosy be necessary or desirable in order to fully carry out theintent and meaning of this agreement
27. The recitals to this agreement are true and are incorporated in this agreement as ifrepeated in this agreement
28. This agreement sets out all of the terms and conditions among the parties relating tothe subject matter and may not be varied or amended except by written documentsigned by all the parties hereto.
29. Any notice or other instrument required to be given pursuant to the provisions of thisagreement shall be in writing and may be given by delivery of same or mailing sameby registered mail, in each case addressed to the relevant party as follows:
(a) To Chinook LPL or any of the Indemnitors:
BennettJonesBarristers & Solicitors4500 Bankers Hall EastCalgary, AB T2P 41(7
Fax No.: 1-403-298-3100
Attention: Ms. Olivia Dixon
(b) To the Surety:
Intact Insurance CompanySecond Floor — 999 West Hastings StreetP0 Box 22Vancouver, BC V6C 2W2
Fax No.: 604-669-1646
Attention: Mr. Peter Dempater
2am
-8-
Any notice or other instrument aforesaid shall, if delivered or sent by fax, be deemed to have beengiven and received on the day on which it was so delivered and, if not on a business day, then on thebusiness day next following the day of delivery and, ifmailed, deemed to have been given and receivedon the third business day following the day on which it was mailed. Any party may change its addressfor notice by notifying all other parties to this agreement, in writing~ in accordance with the provisionsof this paragraph.
30. The invalidity or unenforceability of any provision in this agreement or of anycovenant herein contained on the part of any party shall not affect the validity orenforceability of any other provision or covenant hereof or herein contained and theparties hereby undertake to renegotiate in good faith, with a view to concludingarrangements as nearly as possible the same as those herein contained.
31. Nothing in this agreement or in the relationship of Intact, Chinook PLP or thelndemnitors or any of them shall be construed as in any case creating a partnershipbetween Intact or its agents and Chinook PLP, the Indemnitors, or any of them, or assubjecting Intact or its agents to any of the creditors of Chinook PLP, the Iademnitors,or any of them.
32. Time shall be of the essence of this agreement
33. This agreement may be executed in several parts in the same form and the parts soexecuted shall together form one original agreement, and the parts, ifmore than one,shall be read together and construed as if all the signing parties hereto had executedone copy of this agreement Whenever the singular or masculine are used throughoutthis agreement, the same shall be construed as being the plural or feminine where thecontext so requires.
34. In case any of the parties mentioned in this agreement fails to execute the same, or inthe case of the execution hereof by any of the parties is defective or invalid for anyreason, such failure, defect or invalidity shall not in any manner affect the validity ofthis agreement or the liability hereunder or any of the parties executing the same buteach and every party so executing shall and remain fully bound and liable hereunderto the same extent as if such failure, defect or invalidity had not existed. It isunderstood and agreed by Chinook PLP and the Indemnitors that the rights, powersand remedies given to Intact under this agreement shall be and are in addition to, andnot in lieu of, any and all other rights, powers and remedies which Intact may have oracquire against Chinook PLP, the Indernzutors, or others whether by the tenns of thisor any agreement or by operation of law or otherwise.
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35. No waiver by Intact of any provision of this agreement, thc Bond or the IndemnityAgreements is effective unless made in writing.
IN WITNESS WHEREOF the parties hereto have executed this agreement as of theday and year first above written.
THE CORPORATE SEAL of INTACT INSURANCE COMPANY was hereunto affixed in thepresence of~
THE CORPORATE SEAL OF CHINOOKPIPELINE LIMITED PARTNERSHIPwas hereunto affixed in the presence ofi
C/S~-—
uthonzed Stgnarory
Authorized Signatory
THE CORPORATE SEAL OF CHINOOKPIPELINE LTD. was hereunto affixed inthe presence of~
~2~-~Authorized Signatory
Authorized Signatory
THE CORPORATE SEAL OF CHINOOKPIPELINE INC. was hereunto affixed in thepresence of~
t2~~Authorized Signatory
Authorized Signatory
THE CORPORATE SEAL OF 1466264ALBERTA LTD. was hereunto affixed inthe presence ofi
Authorized Signatory
Authorized Signatory
2525878j
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SIGNED, SEM RD and DELIVERED by )ARCHIE WILUAM CRAIG in the presence )
)
S~e ) ~U <~ ~ ARCHJE WILLIAM CRAIG ~
Print ~%me
Address ))))
Occupation
SIGNED, SEALED and DELIVERED by )NO C IG in the presence o~ )
Print N~3me ) ~JOHN CRAIG (Z ~
~ C~Ze~. ~:i e).Address NOBLE
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Occupation )
2~Z987R ~
E
Appendix E
Aged Accounts Payable listing as at December 1, 2015 —Chinook Pipeline Limited Partnership
Chinook Pipeline Limited PartnershipSupplier Aged Summary As at 01/12/2015
Name Total Current 31 to 60 61 to 90 91÷
101021178 SASKATCHEWAN LTD. 1239.00 0.00 0.00 0.00 1,239.00
101197290 SASKATCHEWAN LTD. O/AGHDR 1,479.50 0.00 0.00 0.00 1,479.50
1026560 ALBERTA LTD. 5,953.50 0.00 0.00 0.00 5,953.50
1065256 AB LTD - NAPA HIGH RIVER -111.13 0.00 0.00 0.00 -111.13
AABLE DIRECTIONAL BORING 110617.50 0.00 0.00 0.00 110,617.50
ACCEDE ENERGY SERVICES LTD. (JET RENTALS) 4,520.25 0.00 0.00 0.00 4,520.25
ACCURATE HD LTD. 286,623.75 0.00 0.00 0.00 286,623.75
ACE LINE LOCATING LTD 6,479.61 0.00 0.00 0.00 6,479.61
AGCOM PETROLEUM SALES LTD. 24,682.48 10,523.07 7,582.41 6,577.00 0.00
ALBERTA LINE FIND 255.15 0.00 0.00 0.00 255.15
ALBERTA ROCKS / A DIV OF V & 0 ANDERSON DEV. CORP. 9,636.01 0.00 0.00 0.00 9,636.01
ALEX CRX 2000 TRANSPORT LTD. 99,757.55 0.00 0.00 0.00 99,757.55
ALLIED DISTRIBUTORS 37,307.74 5,918.11 6,899.92 6,264.89 18,224.82
ALTERNATIVE TRENCHLESS SERVICES LTD. 179,891.25 0.00 0.00 0.00 179,891.25
AMEC ENVIRONMENT & INFRASTRUCTURE 30,540.09 0.00 0.00 11,696.52 18,843.57
ASPIRE TOO 840.00 0.00 0.00 0.00 840.00
ATB MASTERCARD -ARCHIE-1798/7739 12,551.16 12,551.16 0.00 0.00 0.00
ATB MASTERCARD - BEAU S - 1871/4123 -8.29 0.00 -8.29 0.00 0.00
ATB MASTERCARD - DREW I - 1848/4107 -5,866.91 -5,866.91 0.00 0.00 0.00
ATB MASTERCARD - KEVIN R - 1806/4073 1,223.66 1,223.66 0.00 0.00 0.00
ATB MASTERCARD - LUKE W - 1855/4115 1,198.30 20.86 222.28 23.25 931.91
ATB MASTERCARD - MIKE C - 1830/4099 591.41 11.87 20.23 19.96 539.35
ATB MASTERCARD -TIM B - 1814/4081 944.81 15.71 23.02 22.35 883.73
BADGER DAYLIGHTING INC 60,370.57 0.00 0.00 0.00 60,370.57
BATTLE RIVER POWER COOP 91.54 91.54 0.00 0.00 0.00
BEHIEL, WILL & BIEMANS 566.32 0.00 566.32 0.00 0.00
BELL MOBILITY 6,272.45 1,026.72 5,245.73 0.00 0.00
BENNETT JONES LLP 119,822.26 0.00 0.00 12,872.00 106,950.26
BIG BORE DIRECTIONAL DRILLING 348,537.00 0.00 0.00 0.00 348,537.00
BISON IRON CORP. 340.63 0.00 0.00 0.00 340.63
BLUE LINE TRUCK SERVICE LTD. 5,072.16 214.74 0.00 0.00 4,857.42
BMO-BANK OF MONTREAL - 8243/7003 3,762.19 3,961.35 2,300.84 -2,500.00 0.00
BOULDER METAL INDUSTRIES 1,508.40 0.00 0.00 93.93 1,414.47
BRIAN E. WILLIAMS,CA 23,546.98 0.00 17,594.85 2,887.50 3,064.63
BRIDGE LAND & ENERGY SERVICES LTD. 5,725.70 84.61 83.37 82.13 5,475.59
CALGARY TUNNELLING & HORIZONTAL AUGERING LTD. 437,592.45 0.00 0.00 0.00 437,592.45
CAPITAL ONE BUDDY! 4860/3915 5,290.58 1,477.07 3,813.51 0.00 0.00
CAPITAL ONE BUDDY!5415!3501 5,159.69 0.00 166.83 2,501.94 2,490.92
CENTRAL LINE LOCATING INC. 3,360.00 0.00 0.00 0.00 3,360.00
CIC ELECTRIC SERVICE LTD. 1,822.47 2.96 9.06 0.00 1,810.45
CLARESHOLM RENTALS & OILFIELD SERVICES INC. 2,052.75 0.00 0.00 0.00 2,052.75
CLEAN HARBORS PRODUCTION SERVICES, ULC 5,516.10 0.00 0.00 0.00 5,516.10
CRAIG LAW LLP 20,446.50 0.00 0.00 609.54 19,836.96
CROWSNEST-PINCHER REG.WASTE 338.75 0.00 0.00 0.00 338.75
CRP PRODUCTS AND MANUFACTURING LTD. 1,195.57 1,195.57 0.00 0.00 0.00
C-SPEC INSPECTION SERVICES INC. 234.52 0.00 0.00 0.00 234.52
CURTIS ENGINEERING ASSOCIATES LTD. 10,213.24 0.00 0.00 0.00 10,213.24
CYPRESS GROUP 1,514.35 508.79 317.37 310.33 377.86
D.A. WELDING LTD. 14,175.00 0.00 0.00 0.00 14,175.00
D.J. EQUIPMENT RENTALS & SALES 4,449.81 0.00 0.00 0.00 4,449.81
DENKAR AGGREGATES INC. 105,536.40 0.00 0.00 0.00 105,536.40
DFI CORPORATION 22,191.76 0.00 0.00 0.00 22,191.76
DMH PLUMBING & HEATING LTD. 1,427.46 464.25 0.00 0.00 963.21
EMCO CORPORATION 1,950,410.19 0.00 17,181.86 39,608.70 1,893,619.63
EMPIRE TRUCK PARTS (1995) LTD. -1,365.00 0.00 0.00 0.00 -1,365.00
FINNING CANADA (KRAMER LTD.) 14,117.87 233.15 240.93 233.15 13,410.64
FLEET BRAKE -1,894.31 0.00 0.00 0.00 -1,894.31
FOSTER PARK BROKERS INC. 1,840.08 1,840.08 0.00 0.00 0.00
FURNACE MASTERS LTD. 1,129.80 0.00 1,129.80 0.00 0.00
G & J GULKA FARMS LTD 17,226.40 0.00 0.00 0.00 17,226.40
GARNET’S OILFIELD TRUCKING INC. 2,086.88 0.00 0.00 0.00 2,086.88
GARRET’S HEAVY DUTY REPAIR 1,479.50 0.00 0.00 0.00 1,479.50
GRUMPY’S LANDSCAPING LTD. 5,778.20 0.00 0.00 0.00 5,778.20
HBC MASTERCARD 9595 (CAVELL) 2,533.46 1,226.80 248.96 746.79 310.91
HI-WAY 9 EXPRESS 469.39 0.00 187.14 282.25 0.00
HUB INTERNATIONAL PHOENIX 7,201.00 0.00 1,224.00 0.00 5,977.00
HYDRO PRO INC. 78,046.50 0.00 0.00 0.00 78,046.50
HYDROMA)(X INC 619.50 0.00 0.00 0.00 619.50
INTEGRA TIRE WATROUS 437.10 0.00 0.00 0.00 437.10
JADCO SALES LTD. 2,289.44 78.23 392.19 1,819.02 0.00
JAMES MARSHALL TRUCKING LTD. -19,209.06 0.00 0.00 0.00 -19,209.06
JANZEN METAL-FAB LTD. 15,548.55 371.22 655.77 2,418.93 12,102.63
JB CONSULTING INC. 11,603.50 0.00 0.00 477.75 11,125.75
JOHN VERHOEVEN 1,575.00 0.00 0.00 0.00 1,575.00
KEN REED EXCAVATING 682.50 0.00 682.50 0.00 0.00
KINDERSLEY TRANSPORT LTD. 1,107.61 120.48 0.00 328.42 658.71
KINSELLA WATER HAULING 11,265.24 0.00 0.00 0.00 11,265.24
KNEEHILL COUNTY 241.85 62.94 0.00 31.01 147.90
KOCH FUEL PRODUCTS INC. 14,489.70 4,535.70 6,656.96 3,297.04 0.00
KORPAN TRACTOR 94,578.92 1,224.22 1,224.22 0.00 92,130.48
KRAMER RENTS -THE CAT RENTAL STORE 24,471.43 0.00 0.00 -2,788.80 27,260.23
L.M. WASTE REMOVAL LTD. 3,290.50 111.00 47.25 47.25 3,085.00
LAINE CARTER CONTRACTING -14,580.72 0.00 0.00 0.00 -14,580.72
LAST MOUNTAIN INN 1,292.50 0.00 0.00 0.00 1,292.50
LAW INSPECTION SERVICES INC. 949.20 0.00 0.00 0.00 949.20
LONESTAR SYLVAN INC 177,597.05 0.00 0.00 0.00 177,597.05
LOOMIS EXPRESS 14.44 14.44 0.00 0.00 0.00
MANITOU HOTEL 8,013.70 0.00 0.00 0.00 8,013.70
MARSHALL COSTUCTION COMPANY 20,604.00 340.80 340.80 340.80 19,581.60
MCNALLY CONTRACTORS LTD. 30,827.29 0.00 0.00 0.00 30,827.29
MELRON SERVICE LTD. 15,186.32 0.00 0.00 0.00 15,186.32
MIKE SPENCER GEOMETRICS LTD. 2,789.55 0.00 0.00 0.00 2,789.55
MILLER TRUCK PARTS LTD. 2,482.22 51.18 94.65 0.00 2,336.39
MILLSAP FUEL DISTRIBUTORS LTD. 28,426.12 28,426.12 0.00 0.00 0.00
MODERN INDUSTRIAL RENTALS(1 978) LTD. 3,575.25 0.00 0.00 0.00 3,575.25
MRC CANADA (MIDFIELD) ULC 1,274.05 0.00 0.00 1,274.05 0.00
NAPA AUTO PARTS (0441) 9,392.60 184.17 64.51 64.84 9,079.08
NAPA TRACTION BROOKS 347.35 0.00 0.00 347.35 0.00
NATIONAL SALVAGE 2,172.95 0.00 0.00 0.00 2,172.95
NEWELL REGIONAL SERVICES CORP. 8.41 8.41 0.00 0.00 0.00
NORTHBRIDGE GENERAL INSURANCE CORPORATION 2,500.00 0.00 0.00 2,500.00 0.00
NORTHERN INDUSTRIAL PLATING LTD. 2,628.35 0.00 0.00 0.00 2,628.35
NORWOOD WATERWORKS / DIV. OF EMCO CORPORATION 10,791.75 0.00 0.00 0.00 10,791.75
OK TIRE & AUTO - MARSH MECHANICAL 14,510.72 2,940.41 8,770.16 2,800.15 0.00
OK TIRE (LINDE) 601.45 444.00 157.45 0.00 0.00
PARK DEROCHIE COATING (SK) INC. 80,371.75 0.00 0.00 0.00 80,371.75
PARKLAND GEOTECNICAL CONSULTING LTD. 10,585.32 0.00 0.00 0.00 10,585.32
PENNY STEAMERS 2,478.00 0.00 0.00 0.00 2,478.00
PETROFIELD INDUSTRIES INC. 318.48 0.00 0.00 0.00 318.48
PINCHER CREEK FARM CENTRE 8,230.58 4,276.46 2,985.80 968.32 0.00
PINE LAKE SAND & GRAVEL CO. LTD. 585.84 000 000 000 585.84
PIONEER HDD CANADA INC. 66,513.75 0.00 0.00 0.00 66,513.75
PRAIRIE CRANE 10,803.91 0.00 0.00 0.00 10,803.91
PURE PRAIRIE TRUCKING LTD. 84,400.37 0.00 0.00 0.00 84,400.37
QUEST DISPOSAL AND RECYCLING INC 5,622.75 0.00 0.00 0.00 5,62275
R.M. OF WOLVERINE NO. 340 24,459.24 0.00 15,750.00 7,505.79 1,203.45
RAYDON RENTALS dba THE CAT RENTAL STORE 41,298.18 12,217.71 9,998.01 5,635.19 13,447.27
RBC VISA - KEVIN 4452 24,951.46 10,919.25 14,032.21 0.00 0.00
REACT WASTE MANAGEMENT DISTRICT 1,181.85 113.96 520.36 547.53 0.00
REG O’SULLIVAN CONSTRUCTION 4,944.35 0.00 0.00 0.00 4,944.35
RELIABLE TIRE RECYCLING 3,098.86 0.00 0.00 0.00 3,098.86
RESORT VILLAGE OF MANITOU BEACH 5,379.90 1,288.61 98.70 1,430.59 2,562.00
RICHARDSON BROS. COLDS) LTD. 103,320.14 0.00 0.00 0.00 103,320.14
ROBERT STROMBERG LLP 1,568.03 1,568.03 0.00 0.00 0.00
ROBERTSON GROUP LTD. 9,544.09 0.00 0.00 0.00 9,544.09
ROGERS -3,259.60 1,249.40 -4509.00 0.00 0.00
SANDALE UTILITY PROD 761,824.36 0.00 741.95 -2,405.12 763,487.53
SASKENERGY 233.77 0.00 0.00 288.44 -54.67
SASKPOWER 1,096.62 0.00 1,096.62 0.00 0.00
SASKTEL SERVICES -275.66 -275.66 0.00 0.00 0.00
SGI AUTO FUND -132.82 0.00 0.00 368.11 -500.93
SGS CANADA INC 918.75 0.00 918.75 0.00 0.00
SHAW CABLE -1135 BRIAR RD. -155.59 0.00 0.00 -155.59 0.00
SHAW DIRECT 327.62 426.55 0.00 0.00 -98.93
SHAW’S ENTERPRISES LTD. 3,223.32 0.00 0.00 0.00 3,223.32
SILVERLEA DEVELOPMENTS INC. 420.00 0.00 0.00 0.00 420.00
SMITH TRUCKING 4175.99 0.00 0.00 0.00 4175.99
SOLICK SEEDS AG RETAIL INC 9804.51 0.00 0.00 0.00 9804.51
SOUTH WEST WASTE MANAGEMENT INC. 420.00 210.00 210.00 0.00 0.00
SPECIAL AREAS BOARD -0.45 0.00 0.00 0.00 -0.45
SPECTRUM WIRELINE SERVICES LTD. 4252.50 0.00 0.00 0.00 4252.50
SPEEDY SEPTIC TANK SERVICE 3,250.80 0.00 0.00 0.00 3,250.80
STEEL DRAGON MACHINING LTD. 2,069.33 375.06 44.36 152.25 1,497.66
SURE GLASS 278.75 0.00 0.46 0.04 278.25
T3 SAFETY RENTALS LTD 1,260.00 0.00 0.00 0.00 1,260.00
TELUS 4,347.05 0.00 0.00 0.00 4,347.05
TELUS-627-3495 72.05 72.05 0.00 0.00 0.00
TELUS-627-4550 (552-8008) 51.63 51.63 0.00 0.00 0.00
TELUS-627-4602 43.98 43.98 0.00 0.00 0.00
TELUS-627-4603/4604 211.92 211.92 0.00 0.00 0.00
THE BOLT SUPPLY STORE LTD. 7,148.72 0.00 0.00 31.22 7,117.50
THE SALTY SURF INN INC. 4,344.02 0.00 0.00 0.00 4,344.02
TOP WASTE/PEACHES PORTABLES LTD. 2,977.78 0.00 0.00 0.00 2,977.78
TOWN OF CLARESHOLM 1,597.20 44.58 0.00 22.29 1,530.33
TOWN OF PENHOLD 2,525.60 0.00 0.00 0.00 2,525.60
TRIKON PRECAST CONCRETE PROD 7,150.35 0.00 0.00 0.00 7,150.35
TSL MECHANICAL INC 5,586.00 0.00 0.00 0.00 5,586.00
UNITED RENTALS OF CANADA INC. 56,989.90 4,241.18 8,117.65 17,378.40 27,252.67
VISA CLASSIC 11/07 82,411.90 2,095.11 14,270.16 14,999.64 51,046.99
W.R. SCOTT EQUIPMENT LTD 1,707.17 0.00 0.00 33.47 1,673.70
WALMART M/C - CAVELL - 9985/7083 1,900.00 319.10 1,580.90 0.00 0.00
WATER PURE AND SIMPLE 4.75 23.25 0.00 -18.50 0.00
WATROUS CONCRETE LTD. 31,141.75 0.00 0.00 15,863.33 15,278.42
WATROUS CO-OP ASSOC. LTD. 143,692.59 18,912.50 58,438.86 66,341.23 0.00
WATROUS HOME HARDWARE BUILDING CTR. 8,325.73 5,036.06 870.21 2,294.14 125.32
WATROUS NEW HOLLAND 5,448.56 1,256.69 3,024.30 1,167.57 0.00
WELL PRO ENTERPRISES LTD. 29,890.75 0.00 0.00 0.00 29,890.75
WENSTROM EQUIPMENT COMPANY 3,024.81 0.00 0.00 0.00 3,024.81
WEST CENTRAL HEAVY DUTY REPAIR LTD. 33.32 0.00 0.00 0.00 33.32
WESTERN FINANCIAL GROUP - (NAN) 2,631.78 0.00 0.00 0.00 2,631.78
WESTERN LICENCE & TRANSPORTATION SERVICES LTD. 20.00 0.00 0.00 0.00 20.00
WOODY’S AUTO-STETTLER 646.78 0.00 0.00 646.78 0.00
WORKER’S COMPENSATION BOARD 14,610.00 14,610.00 0.00 0.00 0.00
YOUNG CO-OPERATIVE ASSOC. 2,350.39 428.55 1,455.08 466.76 0.00
Total outstanding: 6,292,211.81 155,354.45 213,781.98 228,851.92 5,694,223.46
Generated On: 21/09/2016
F
Appendix F
Chinook Pipeline — Draft Management Discussion & Analysis document
MANAGEMENT DISCUSSION ANDANALYSIS
OCTOBER 2015
APRIL 2015 YEAREND DISCUSSION &FISCAL 2016 PROJECTIONSGROUP OF COMPANIESINTERNAL & PRIVATE
GROUPOFC1X~H’AN1ES
PRELUDE
Chinook Pipeline Limited Partnership (Chinook) has reviewed the 2015 fiscal year to date to identifysignificant events and challenges, root causes and effects, and solutions and strategies to overcome thechallenges presented.
> Chinook experienced significant project specific challenges on the ACE — Phase 3 — Contract 11project near Two Hills, AB
> These challenges had effects on Chinook cash flow & short term profitability
~ In addition to the challenges created above, Chinook has and is currently participating on megainfrastructure projects that have large working capital requirements to fund the projects tocompletion to access the accumulated cash holdback funds to achieve cash flow success of thiswork
~ Canada and Alberta have both elected a left wing Government administration that traditionallyhas been positive for funding of infrastructure related activities which subsequently improvesthe optimism of the medium term market outlook
> It is important to review implemented strategies of fiscal 2015, successes, opportunities forimprovement and continued improvement, timeline and implementation of new strategies,overall strategic direction, and future business opportunities and challenges
1 P ~ g e
~kirn43kGROUP OECO3IPANIES
Table of Contents
Section 1 — 2015 Challenges 3
Section 2— 2014/2015 Implemented Strategies 5
Section 3—2016/2017 Opportunities for Improvement & Implementation 7
Section 4— Strategic Direction & Business Opportunities 11
Section 5— Financial Discussion & Strategy 12
Appendix 1— Reviewed Consolidated Financial Statements — April 30, 2015
Appendix 2 - Capital Asset Summary
Appendix 3— Financial Pro-Forma April 30, 2016
Appendix 4— Prospective Project Forecasting
2 I P ~ g
I_)I. I~IU~W6kGROtWOFCOMP~LN1ES
1.0 2015 Challenges
Chinook submitted a tender and was awarded the ACE — Phase 3 — Contract 11 project near Two Hills,
Alberta, which largely involved the supply and installation of approximately 25 km of 250mm water
pipeline. This project is predominately the scope of Chinook’s core business and the scope would
typically lend itself to the strengths of Chinook’s expertise and successful business activities illustrated
over the past 50 years.
For the decade leading up to the award of this project, Chinook’s activity had continually grown year
over year, as consistent with the success and strategy of the business. At this time, Chinook considered
and proceeded with the addition of Subcontract labour to augment Chinook available equipment
resources to facilitate the construction of the project. This decision was made as a function of human
resource capacity from the ongoing challenge to recruit qualified labour in the tight labour market
conditions that existed at the time of this project. The Work was substantially completed with Chinook
internal forces following the termination of the Subcontract agreement for non-performance.
The project conditions and political environment that resulted became toxic. It became apparent that
the working relationship between the Owner’s representative and Chinook was not conducive to the
final success of the project. Efforts were made by both parties in the 2014 construction season and
substantial progress realized on the project, until a monetary and performance dispute ensued.
On or about January 2015, while the project was in the corn missioning process with 100% of the pipeline
flushed and swabbed and approximately 60% pressure tested, Chinook’s Surety accepted the Owner’s
claim of non-performance, despite the explicit acknowledgment that Chinook did not admit or has not
been judged in default of the Contract, but rather the Surety deemed it as a “collaborative solution to a
toxic environment”.
3 I Page
@Iti,woltGROUP OFCOMPANIES
Chinook analyzed the options and remedies available with its legal counsel and Surety and a decision
was made that the Chinook disputed Surety acceptance of the claim was the most efficient short term
resolution compared to other remedies of further liens and litigation, of which Chinook may consider
following the final completion of the project. The rationale is that by accepting the claim, the Surety had
the best chance of collecting the Contract funds withheld by the Owner to distribute to any unpaid
vendors, with any surplus to Chinook in a timelier manner than the alternatives.
The strategy proved to be futile but as such, the project is now operational, the Owner retains Contract
funds, and Builders’ Liens have been filed in the amount of approximately $3,800,000.
In an unrelated Contract, the Contract is complete and operational but Chinook has filed Builder’s Liens
in the amount of $3,300,000 and issued a Statement of Claim in the amount of $5,500,000 as a result of
a Contractual financial disagreement with the Owner.
41 ~age
~kbwi~kGROUPOFCOMPiNJES
2.0 2014/2015 Implemented Strategies
Through the course of fiscal 2015, Chinook has evaluated and incorporated internal feedback and
feedback from various stakeholders, in an effort to reconcile challenges and provide operational
success.
1. Chinook has recruited two middle management personnel and one trained management
support
Michael Coles, P. Eng, has been added as a Project Manager and in-house engineer. He has
been incorporated into our SSEWSS project in Saskatchewan to provide administrative and
technical support as the project proceeds closer to completion.. The addition of a professional
engineer to our team also supports our proposals as Chinook intends to participate in the
evolution of Design-Build proposals that are becoming increasingly popular in our space, and
what Chinook views as the long term future of our industry.
Rockey Young, has been added as a Construction Manager. Mr. Young is an excellent fit for our
company culture and strategy. He brings many years of experience and broad skills set in
management and construction. We look forward to his continued development and full
integration into our team.
Tanna Ross, CET, has been added as Managerial support. Ms. Ross is a recent graduate from the
CET program at Lethbridge College, and supports our current management with her clerical skills
and competence in AUTOCAD and other relevant engineering software. This allows our team to
delegate tasks that she reciprocates with timely, relevant information and data.
5j Page
~!thwikGROUP OFCOMP&NTES
2. Chinook has selected a new financial partner to support our strategic direction and continued
financial requirements
In December 2014, Chinook established new credit facilities at ATB Financial with largely the
same terms as existing facilities, and concluded its previous facilities at RBC. ATB provides a
more robust package of various credit facilities including an operating line, Evergreen capital
facilities, property mortgages, currency and commodities derivatives facilities and an integrated
culture of that of our business partner, and not only our lender.
Chinook is also evaluating key person insurance and access to capital markets as other value
added services offered by our partners at ATB Financial,
3. Financial reporting improvement
Various stakeholders have indicated the value of timely in-house reporting. Chinook has been
seeking and evaluating potential new and existing team members to increase efficiency in this
area, but has not been successful at this time. Chinook has increased the frequency of its in
house reporting to its stakeholders and adopted an improved reporting template to facilitate
improved interpretation and value of the reporting.
61 ~ag e
(~4thwokGROUP OF COMPANIES
3.0 2016/2017 Opportunities for Improvement & Implementation
Chinook has identified opportunities for improvement and further improvement in a number of areas in
addition to the strategies implemented in 2015.
1. Addition of further middle management and upper management resources
As will be discussed in subsequent sections, the same current market conditions that may present
pricing pressure of small or mid size Contracts, may also provide an opportunity to recruit further
quality management to incorporate into our team. The effects of this market, created by the recent
collapse of oil prices, manifest by increased competition of small and mid size Contracts and
increased pricing pressures, but also may provide the opportunity to add personnel from distressed
or wound-down firms that have seceded to the market. Recruiting focus will be on further Project &
Construction management and Upper management to improve financial reporting efforts.
2. Improvement of financial reporting
Chinook acknowledges the value of timely, quality of further improved internal reporting to its
various stakeholders. In an effort to continually improve the reporting of this information, Chinook
will continue to seek the addition of new team members to facilitate the efficient processing and
dissemination of this reporting in addition to evolving a more detailed format, adding greater value
in this reporting as we seek to add resources and/or adopt alternative external strategies.
3. Scheduling and internal project controls
Chinook has identified area for improvement with our team’s effective planning and execution of
project scheduling and control of critical path items. Chinook has added managerial support and if
71 ~ge
(~kbu~okGROUP OF COMPANIES
illustrated as effective, will continue to add such support by way of educated team members that
are competent in scheduling software and management, that will add value to the construction and
project management team, in proactively identifying and managing challenges. The addition of
costs controls and micro cost management will follow as the team adopts the schedule and project
controls outlined.
4. Middle management information and tool box
Chinook has identified the need to disseminate private Contract pricing and strategy discreetly to
Project Managers and Construction Managers, to facilitate their awareness of the upper level of the
Contract finances and associated costs. This strategy is focussed on providing management more
information to facilitate informed decisions from the new information skill tool box and may be
implemented by way of VPN (Virtual Private Network) and other technology assets.
Immediate term — November 1, 2015— December 31, 2015
Chinook’s immediate focus is to efficiently complete and maximize cash flows and profitability of
this SSEWSS project in Saskatchewan. Consolidation of resources and efforts will facilitate
substantial completion of SSEWSS on or before December 31, 2015, and subsequently the release of
the legislated holdback cash flow.
8 Page
~kino~kGROUP OF CO3IPAXIES
Short term — January 1, 2016 — Oecember 31, 2016
Chinook will actively recruit and search for quality middle management including Project and
Construction Managers to strengthen our administrative and logistical team. Chinook may consider
the addition of further personnel to augment the recent addition of in-house engineer to create
efficiency and opportunities associated with this value added service now available from Chinook to
its Clients. These prospective team members may include further CET trained personnel, drafting,
land procurement and environmental professionals.
Chinook is optimistic about the prospective size and volume of Contracts being contemplated in the
strategic area as outlined in following sections. Our mandate is to continue with our dominant
presence in this market and maximize the sunk costs that have been invested in entering this market
in 2013, and further investment that may be required to enter other strategic markets. This early
entry to this niche geographic and industry markets should provide a competitive advantage as new
participants seek to enter this market out of necessity.
In our traditional market of Southern & Central Alberta, Chinook will strive to seek out Contracts
that lend themselves to niche scopes of work that Chinook has developed experience in more recent
years including maxi-directional drilling and utility ROW preparation. It is forecasted that these
niche markets may have less competitive and pricing pressures than the broader pipeline
construction Contracts that may be tendered in the short term. Chinook will also evaluate potential
value of internal infrastructure stimulus by way of development of internally held real estate.
Chinook will evaluate the use of external construction accounting professionals to improve reporting
in the interim as it continues to investigate the permanent addition of a professional to manage this
role from an internal prospective.
91P age
@kiiwd~GROUI’ OFCOMPANTES
Medium term — January 1, 2016— December 31, 2020
Chinook will continue to evaluate and recruit for upper management positions to facilitate
efficiencies of the scale of the company including consideration fora CFO and General Manager
position. As the management team continues to grow from the short term, it will be important for
the upper management to grow in conjunction to support this structure. This will enable existing
senior upper management to work “on the business” rather than exclusively “in the business”.
Chinook will continue to participate in Contract opportunities that are viewed as profitable and lend
themselves to the strengths of Chinook. In the ever changing market environment, it is important to
consider a broad array of opportunities, with the shorter term focus on the Saskatchewan
infrastructure market and niche opportunities in the tighter Alberta market, and evaluate
opportunities in new markets such as North Dakota.
Chinook will continue to vertically integrate to realize efficiencies, maximize profitability and provide
the opportunity to adapt to the changing market conditions in which we operate.
Long term — January 1, 2016 — December 31,2025
Chinook looks forward to continuing our track record of success that has been established over the
last 50 years of operation. Chinook is proud of the value that is created for its many employees,
vendors, Clients and communities in which it operates.
10 I P a g e
I~q’iuw1ogGROUP 0 COMPANLFS
4.0 Strategic Direction & Business Opportunities
As alluded previously, the current short term market conditions are forecasted to manifest into
increased competition and downward pricing pressure on small and mid size Contracts. The initial
market reaction to depressed oil prices have been much the same as the reaction of the 2008 financial
crisis and subsequent recessionary period, albeit, Chinook management views this particular market as a
fundamental correction compared to the turbulence of 2008. The medium term market sediment may
be improved by the prospects of increased infrastructure funding from the recently elected provincial
and federal governments.
As such, Chinook maintains the strategic direction of entering new less cyclical markets as was
completed with the award of the SSEWSS project in Saskatchewan in 2013. This multi-year project has
provided Chinook the opportunity, to not only strategically enter a new geographic market that is not
necessarily dependent on oil, but to enter a new size of Contract that provides a marketplace of less
competition and longer term volume security.
Currently, Chinook is being considered through a pre-qualification process for another project for the
same Owner, in the same geographic market and similar or larger Contract size. if successful in pre
qualification, this tender process will allow Chinook to further its strategy to remain a player in this
market and minimize the impacts of the current local market conditions. This Contract opportunity is
forecasted to engulf the Q3 2016— Q4 2017 construction duration with a Contract value between
$30,000,000 and $50,000,000.
Other opportunities of interest are a number of Design-Build opportunities presented in our localized
Southern Alberta market and as may be proposed by Chinook to other return Clients. These
opportunities allow Chinook to incorporate our relatively recent addition of in-house engineering and
also mitigate the market pressures presented in the traditional public tender environment rampant at
this time. Chinook is also evaluating a joint venture option to access new markets, realize efficiencies
and manage risk.
11 p a g e
(4wW4.~k(;ROIJP OF COMPANIES
5.0 FInancial Discussion & Strategy
Recent historic financial analysis of Chinook’s performance of the trailing 5 years presents, EBITDA
ranging from $1,000,000 to $2,000,000, and healthy liquidity and solvency ratios through our strategic
growth cycle.
Chinook has experienced financial impacts from the vortex of dispute surrounding the ACE project
manifesting in a consolidated EBITDA of $500,000 for year ending 2015. Chinook returned to the project
in an effort to resolve the Contract underperformance and since returning, Chinook has internally
funded $2,000,000 of cash flow losses and currently has a total cash flow deficit of $4,500,000 from the
operations and expenses incurred on this project and lack of reciprocating payment from the Owner.
Results of the challenges of 2015 have had negative cash flow and profitability impact in the short and
medium term.
Chinook has identified liquidity as our greatest financial risk, as has been consistently the greatest risk
for our business and industry since inception.
Short term financial challenges include margining covenants moving forward into a turbulent market
with decreasing backlog of Contract work.
12 { P ~ g e
GROUP OF COMPAYIES
Chinook is evaluating several strategies including:
1. Evaluation of materials and aggregate inventories and reserves as a short term margin covenant
solution
2. Assessment of disposal of non-core assets focussing on maximizing value in a saturated asset
disposition marketplace, in an effort to manage risk and deleverage the balance sheet
3. Evaluate extending amortization periods of Evergreen facility upon renewals to preserve
working capital and liquidity
4. Further development of assets to monetize value including undeveloped aggregate properties
and reserves, developable industrial land and developable residential properties
5. Evaluate current opportunities of a partnership or joint venture to create value and efficiencies,
such as combined balance sheet strength allowing each to deleverage appropriately, access to
markets, synergies in administration, and potential growth.
13 I P a g e
CHINOOK PIPELINE INC.
Consolidated Financial Statements
April 30, 2015
(Unauditod)
Printed on: October26, 2015 8:17 PM
1
CHINOOK PIPELINE INC.
April 30, 2015
(Unaudited)
Index to Consolidated Financial Statements
REVIEW ENGAGEMENT REPORT 2
CONSOLIDATED FINANCIAL STATEMENTS
Consolidated Balance Sheet 3
Consolidated Statement of Loss and Retained Earnings 4
Consolidated Statement of Cash Flows 5
Notes to Consolidated Financial Statements 6 - 14
Printed on: October26, 2015 8:17 PM
2
4
REVIEW ENGAGEMENT REPORT
To the Shareholders of Chinook Pipeline Inc.
I have reviewed the consolidated balance sheet of Chinook Pip~line Inc. as at April 30, 2015 and theconsolidated statements of loss and retained earnings and Oash flows for the year then ended. Myreview was made in accordance with Canadian generally accepted standards for review engagementsand accordingly consisted primarily of enquiry, analytical procedures and discussion related toinformation supplied to me by the Company.
A review does not constitute an audit and consequently I do not express an audit opinion on theseconsolidated financial statements.
Based on my review, nothing has come to myattention that causes me to believe that these consolidatedfinancial statements are not, in all material respects, in accordance with Canadian generally acceptedaccounting principles.
CHARTERED ACCOUNTANT
CALGARY, ALBERTANovember 13, 2014
Printed on: October 26, 2015 8:17 PM
3CHINOOK PIPELINE INC.
Consolidated Balance Sheet
April 30, 2015
(Linaudited)
ASSETS
2015 2014
Current
Capital assets (Note 4)
21,001,896 12,913,767
i1,455,~32 10,086,717~
$32,457,828 $ 23,000,484
CurrentLIABILITIES
$ 6,688,5197,883,806
70677,532
6,439,665152,086284.400
$ 3,590,8764,302,762
70,10016,654
3,106,47092,000
438.500
Approved on Behalf of the Board
Director
Director
Cash $ 297,978 $ 520,828Short term investments (Note 3) 32,033 13,780Accounts and holdbacks receivable 16,900,279 10,516,144Unbilled contract revenue 2,574,393 1,550,365Spare parts and supplies 619,713 127,650Prepaid expenses 577~500 185,000
Bank indebtedness (Note 5)Accounts payable and accrued liabilities (Note 6)Income taxes payableDue to shareholders (Note 7)Callable debt (Note 8)Current portion of long term debtCurrent portion of future income taxes
Long-term debt (Note 9)
Future income taxes (Note 10)
SHAREHOLDERS’ EQUITYShare capital issued:
50 Class A common non-voting shares2,002 Class B voting pref&red shares, redeemable and
retractable in the aggregate redemption amount$2,750,000.
Retained earnings
21,526,714 11,617,362
95,621 92,000
847,900 747,000
22,470,235 12,456,362
10,000 10,000
2,002 2,002
9,975,591 10,532,120
9,987,593 10,544,122
$ 32.457.828 $23,000,484
Printed on: October 26, 2015 8:17 PMSee notes to financial statements
4CHINOOK PIPELINE INC.
Consolidated Statement of Loss and Retained Earnings
Year Ended April 30, 2015
(Unaudited)
2015 2014
Contract revenue $ 30,084,312 $ 32,345,595
Direct contract costs 21,635,237 22,99~,746
Gross profit 8,449,075 9,350,849
ExpensesSalaries and benefits 7,108,796 6,406,359Amortization 719,922~ 699,759Insurance and licenses 2O3,5E~7 195,893Professional fees 268,535 119,990Interest and bank charges 279,406 117,505Interest on callable debt 140,865 98,862Utilities 84,143 96,196Management and administrative fees 87,000 87,000Rent 82,378 77,776Telephone 61,054 52,695Advertising and promotion 26,626 38,803Office 25,935 30,969Interest on long term debt 11,697 5,768
9,099,464 8,027,575
Income (loss) from operations (650,389) 1,323,274
Other income (charges)Interest Income 1,216 7,564Gain (loss) on disposal of capital assets’ 21,806 32,887Loss on write down of short term investments 18,238 (24,188)
41,260 16,263
Income (loss) before income taxes (609,129) 1,339,537
Income taxes (recovered)Current 600 70,000Future (53,200) 101,000
(52,600) 171,000
Net income (loss) (556,529) 1,168,537
Retained earnings, beginning of year 10,532,120 9,363,583
Retained earnings, end of year $ 9,975,591 $10,532,120
Printed on: October 26, 2015 8:17 PMSee notes to financial statements
5
Cash provided by (used in):
CHINOOK PIPELINE INC.
Consolidated Statement of Cash Flows
Year Ended April 30, 2015
(Unaudited)
2015 2014
Operating activitiesCash received from customersCash paid to employeesCash paid to suppliersInterest receivedInterest paidIncome taxes
Investing activitiesPurchase of capital assetsProceeds on disposal of capital assets
Financing activitiesAdvances from (repayments to) shareholdersAdvances from callable debtRepayment of callable debtRepayment of long-term debtProceeds from long-term debt
$ 28,809,994(6,406,359)
(22,951,599)7,173
(222,135)(71,597)
Deficiency, end of year $ (6,390,541) $ (3,070,048)
Deficiency consists of:Cash $ 297,978 $ 520,828Revolving line of credit (6,688,519) (3,590,876)
~ $ (6,390,541) $ (3,070,048)
Printed on: October 26, 2015 8:17 PMSee notes to financial statements
$22,676,149(7,108,796)
(19,777,534)1,20f~
(431968)(69,994)
(4,710,942) (834,523)—
(~,144,756) (2,026,737)77,425 153,350
(2,067,331) (1,873,387)
60,878 (7,741)7,124,340 1,736,517
(3,791,145) (1,411,531)(122,470) (92,000)186,177 -
3,457,780 225,245
(3,320,493) (2,482,665)
(3,070,048) (587,383)
Decrease in cash
Deficiency, beginning of year
6CHINOOK PIPELINE INC.
Notes to Consolidated Financial Statements
April 30, 2015
(Unaudited)
1. Description of Operations
The Company is engaged in pipeline and mechanical construction in both the municipal water andsewer sector, and the petroleum and natural gas industry.
2. Summary of Significant Accounting Policies
The Company’s accounting policies and its standards of financial disclosure are in accordance withthe recommendations of the Canadian Institute of Chartered Accountants.
/
a) Basis of presentation
These financial statements are prepared in accordance with Canadian Accounting Standardsfor Private Enterprises (“ASPE”).
b) Principles of consolidation
The accompanying consolidated financial statements include the accounts of Chinook PipelineInc., and its wholly owned subsidiaries: Chinoolc Pipeline Ltd., 1466264 Alberta Ltd. andChinook Pipeline Limited Partnership. All inter-company balances and transactions have beeneliminated on consolidation.
c) Cash and cash equivalents
The Company considers all term deposits and highly liquid debt instruments purchased with amaturity of three months or less to be cash equivalents.
d) Short-term investments
Short-term investments are recorded’at the lower of cost and market value.
e) Spare parts and supplies~
Spare parts and supplies are valued at the lower of cost and market value. Cost is determinedusing the first-in, first out method and market is determined using replacement cost.
f) Capital assets
Capital assets are~ recorded at cost less accumulated amortization. The Company amortizescapital assets over their estimated useful lives, to their estimated residual values, using thefollowing anhual rates and methods:
Construction equipment 15% Declining balanceAutomotive equipment 15% Declining balanceBuildings 5% Declining balance
Printed on: October 26, 2015 8:17 PM
7CHINOOK PIPELINE INC.
Notes to Consolidated Financial Statements
April 30, 2015
(Unauclited)
2. Summary of Significant Accounting Policies (Continued)
g) Impairment of long-lived assets -
Management reviews property, plant and equipment for impairment whenever events orchanges in circumstances indicate that the carrying amounts may not be recoverable.Recoverability is assessed by management comparing the carrying amount to the estimatedfuture net cash flows the assets are expected to generate. Where the carryir3g value exceedsestimated net cash flows, the assets are written down to fair value.
h) Revenue recognition
Profits from construction contracts are recognized for accounting purposes on the percentageof completion method. The percentage of completion is determined by relating the actual costof work performed to date to the current estimated total cost of the respective contracts. Whenthe current estimated costs to complete indicate a loss, such loss is recognized immediately foraccounting purposes. Revisions in costs and profit or loss~ estimates during the course of thework are reflected during the accounting period in which the facts which cause the revisionbecome known. Income from claims is recorded in the year such claims are resolved.
Unbilled contract revenue represents the excess of contract costs and profits recognized todate on the percentage of completion accounting method over billings to date. Unearnedcontract revenue represents the excess of billings to date over amount of contract costs andprofits recognized to date on the percentage of completion accounting method.
I) Income taxes
The Company follows the tax liability method of accounting for income taxes. Under thismethod, future tax liabilities and assets are recognized for the estimated tax consequencesattributable to differences between the financial statement carrying amounts of assets andliabilities and their respective téx bases. Future tax liabilities and assets are measured usingenacted tax rates. The effect~ on future tax liabilities and assets of a change in tax rate isrecognized in income iii the period that the change occurs.
j) Use of estimates
The preparation of financial statements in conformity with Canadian accounting standards forprivate enterprises requires management to make estimates and assumptions that affect thereported ambunts of assets and liabilities and disclosure of contingent assets and liabilities atthe date of the financial statements and the reported amounts of revenues and expensesduring, the reporting period. Significant items subject to such estimates and assumptionsinclude: the percentage completion calculation; the estimated useful lives of capital assets; thevaluatIon allowance for accounts receivable; and the valuation of the inventory of parts andsupplies. Actual results could differ from those estimates.
Printed on: October26, 2015 8:17 PM
CHINOOK PIPELINE INC.8
Notes to Consolidated Financial Statements
April 30, 2015
(Unaudited)
2. Summary of Significant Accounting Policies (Continued)
k) Financial instruments
Financial instruments are recorded at fair value on initial recognition. Financial instruments aresubsequently recorded at cost or amortized cost, unless management has elected to carry theinstruments at fair value. The Company has not elected to carry any such financialinstruments at fair value.
Transaction costs incurred on the acquisition of financial instruments measured subsequentlyat fair value are expensed as incurred. All other financial instruments are adjusted bytransaction costs incurred on acquisition and financing costs, which are amortized using thestraight-line method.
Financial assets are assessed for impairment on an annual basis at the end of the fiscal year ifthere are indicators of impairment. If there is an indicator of impairment, the Companydetermines if there is a significant adverse change in the expected amount or timing of futurecash flows from the financial asset. If there is a significant adverse change in the expectedcash flows, the carrying value of the financial asset is reduced to the highest of: the presentvalue of the expected cash flows; the amount that could be realized from selling the financialasset; or the amount the Company expects to realize by exercising its right to any collateral. Ifevents and circumstances reverse in a future period, an impairment loss will be reversed to theextent of the improvement, not exceeding the initial carrying value.
3. Short-term investments
2014Accumulated Net BookAmortization Value
LandConstruction equipmentAutomotive equipmentBuildings
Portfolio Investments (market value $30,334)Equity membership - UFA (market value $1, 701)
4. Capital assets
2015 2014
$ 30,334 $ 12,9061,699 1,684
$ 32,033 $ 14,590
2015Net Book
ValueCost
$ 859,500 S - $ 859,500 $ 859,50013,828,497 4,790,671 9,037,826 7,700,3152,329,670 1,013,381 1,316,289 1,273,436
304,934 62,617 242,317 253,466
$ 17,322,601 $ 5,866,669 $ 11,455,932 $ 10,086,717
Printed on: October 26, 2015 8:17 PM
CHINOOK PIPELINE INC.9
5. Bank indebtedness
Notes to Consolidated Financial Statements
April 30, 2015
(Unauditcd)
The Company has entered into a financing arrangement with the a financial institutions for a$6,500,000 revolving line of credit, with interest payable monthly at the bank’s prime~ lending rateplus 0.75% per annum. The line of credit is secured by a general security agreement cävering allpresent and after acquired assets.
The Company is not in complete compliance with certain of its financial covenants as required underthe terms of its lending agreement with its financial institution. The financial institution has notindicated the actions it may take and management is working to rectify the~covenant position by thesubsequent year end.
6. Accounts payable and accrued liabilities2015 2014
Included in account payable and accrued liabilities are government remittances payable, asfollows:
GST payablePayroll source deductions payable
The amount due to parent company is due on demand, non-interest bearing, unsecured and has noset terms of repayment.
7. Due to shareholders
$ 391,800530.100
$ 415,30047,800
$ 921,900 $ 463,100
Printed on: October 26, 2015 8:17 PM
10CHINOOK PIPELINE INC.
Notes to Consolidated Financial Statements
April 30, 2015
(Unaudifed)
8. Callable debt2015 2014
8ank demand loan bearing interest at 3.61% per annum,repayable in monthly installments of $28,649 principal andinterest, maturing October 2017. $ 819,727 $~
Bank demand loan bearing interest at 3.89% per annumrepayable in monthly installments of $28,771 principal andinterest, maturing October 2017. 820,837
Bank demand loan bearing interest at 3.89% per annumrepayable in monthly installments of $28,711 principal andinterest, maturing November 2017. 847,641
Bank demand loan bearing interest at 3.89% per annumrepayable in monthly installments of $28,771 principal and~interest, maturing November 2017. 848,378
Bank demand loan bearing interest at 3.89% per annumrepayable in monthly installments of $4,224 principal plusinterest, maturing November 2019. 212,765
Bank demand loan bearing interest at 3.6% per annumrepayable in monthly installments of $4,695~principal andinterest, maturing November 2017. 138,844
Bank demand loan bearing interest at 3~61% per annumrepayable in monthly installments of $4,4~03 principal plusinterest, maturing November 2017. 130,079
Bank demand loan bearing interest at 3.61% per annumrepayable in monthly installments of $5,283 principal andinterest, maturing December 201T. 160,936
Bank demand loan bearing interest at the 3.16% perannum, repayable in monthly installments of $15,544principal plus interest, maturing March 2019. 673,363
Bank demand loan b~ring interest at 3.33% per annumrepayable in monthly installments of $15,562 principal plusinterest, maturing April 2019. 687,095
Bank demand loan bearing interest at 3.18% per annumrepayablein monthly installments of $13,328 principal plusinterest, maturing April 2019. 600,000
Bank demand loan bearing interest at 3.21% per annumrepayable in monthly installments of $11114 principal plusinterest, maturing April 2019. 500,000
Printed on: October 26, 2015 8:17 PM
11CHINOOK PIPELINE INC.
Notes to Consolidated Financial Statements
April 30, 2015
(Unaudited)
8. Callable debt (Continued)2015 2014
Bank demand loan bearing interest at 4.0% repayable incombined monthly installments of $21,028 principal andinterest, secured by a general security agreement, a floatingcharge on land, and a fixed and floating charge coveringequipment. -. 347,494
Bank demand loan bearing interest at 3.3% repayable incombined monthly installments of $31,176 principal andinterest, secured by a general security agreement, a floatingcharge on land, and a fixed and floating charge coveringequipment. - 898,964
Bank demand loan bearing interest at 3.4% repayable incombined monthly installments of $28,398 principal and~interest, secured by a general security agreement, a floating’charge on land, and a fixed and floating charge covering’equipment. - - 449,239
Bank demand loan bearing interest at 3.5% repayable incombined monthly installments of $29,716 principal andinterest, secured by a general security agreement, a floatingcharge on land, and a fixed and floating charge coveringequipment. - 565,168
Bank demand loan bearing interest- at~3.6% repayable incombined monthly installments of $34,221 principal andinterest, secured by a general security agreement, a floatingcharge on land, and a fixed and floating charge coveringequipment. - 845,605
$ 6,439,665 $ 3,106,470
The callable debt is secured by a general security agreement over all present and after acquiredassets; a floating charge on land; and a $350,000 mortgage constituting a first fixed charge on land.
The Company is not in complete compliance with certain of its financial covenants as required underthe terms of its lending agreement with its financial institution. The financial institution has notindicated the actions it may take and management is working to rectify the covenant position by thesubsequeht year end.
Printed on: October 26, 2015 8:17 PM
12
9. Long-term debt
CHINOOK PIPELiNE INC.
Notes to Consolidated Financial Statements
April 30, 2015
(Unaudited)
2015 2014
Mortgage payable, repayable in annual installments of$92,000 plus interest at 3.0% per annum, maturing June 1,2015, secured by a $1 million first mortgage on the subjectland, having a net book value of $660,000. $ 92,00W ‘ $ 184,000
Finance contract, repayable in monthly installments of$2,330 including interest at 6.99% per annum, maturingSeptember 2017, collateralized by the constructionequipment financed, having a carrying value of $68,000. 61,999
Capital lease, repayable in monthly installments of $3,390including interest at 6.4% per annum, maturing October2017, collateralized by the construction equipment leased,having a carrying value of $94,000.
Current portion
Minimum annual principal repayments are as follows:
93,708 -
247,707 184,000
152,086 92,000
$ 95,621 $ 92,000
201620172018
$ 152,08664,21131,410
$ 247,707
Printed on: October 26, 2015 8:17 PM
13
10. Future Income taxes
CHINOOK PIPELINE INC.
Notes to Consolidated Financial Statements
April 30, 2015
(Unaudited)
The components of the future tax liability are as follows:
Current
Future income tax liabilities:Construction holdbacks
Future income tax assets:Federal and provincial income tax loss carryforwards
Long-term
Future income tax liabilities:Carrying value of capital assets in excess of taxbasis
11 * Related party transactions
2015 2014
$ 301~4O0. $ 455,500
(17,000) (17,000)
$ 284,400 $ 438,500
S 847,900 $ 747,000
2015 2014
The financial statements include the following transactions with a company that is related by virtueof a common shareholder, director and offiéer:
Accommodation expense $ 185,000 $ 240,000
In addition, at April 30, 2015, the following amounts paid to the same related party are includedincluded in the Company’s balance sheet:
Prepaid accommodation expense $ - $ 185,000
The transactions were in the normal course of operations and were measured at the exchangeamount, which is the amount of consideration established and agreed to by the related parties.
Printed on: October 26, 2015 8:17 PM
14CHINOOK PIPELINE INC.
Notes to Consolidated FInancial Statements
April 30, 2015
(Unaudited)
12. Financial Instruments
The Company is exposed to the following risks related to its financial assets and liabilities~
a) Market risk
The Company’s revenue is derived from providing pipeline and mechanical constructionservices to various customers, in numerous industries, which are subject to ~eneraI economictrends. A decline in economic conditions, consumer spending levels or other adverseconditions could lead to reduced revenue and lower margins.
b) Credit risk
Credit risk arises from the possibility that the entities to which the C~ompany provides servicesmay experience difficulty and be unable to fulfil their obligationfrThe Company is exposed tofinancial risk that arises from the credit quality of the entities to which it provides services.
The Company’s receivables are due from various cus~tomers in numerous different industriesand are thus subject to normal industry credit risks~ Due to the diversified nature of theCompany’s customers, the credit risk concentration is also minimized.
c) Interest rate risk
The Company’s revolving line of credit and callable debt incur interest based on the primelending rate plus 1.0%. The Compan~ is, therefore, exposed to interest rate risk throughfluctuations in the prime lending rate. At April 30, 2014, the decrease in net income for each 1%increase in the bank lending rate would not be material. The Company does not use derivativeinstruments to reduce its exposure to interest rate risk.
13. Commitments
In the normal course of operations( the Company enters into contracts with customers and otherparties for pipeline and mechanical construction services. These contracts are often completed overseveral months or more and may extend over a fiscal year end.
The Company has ongoing commitments to complete its responsibilities under the terms andconditions of these contracts.
Printed on: October 26, 2015 8:17 PM
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• YEAR END 2016 - FORECAST
OCTOBER312O1SGROUP OF COMPANIES
FORECAST
2015 YE - IN HOUSE APRIL30 2016
REVENUE $27,030,038.04 $12,398,817.411
IDIRE~ COSTS $26,131,886.82 $10,572,560.541
1GR055 PROFIT $898,151.22 $1,826,256.871
GENERAL & ADMIN EXPENSES
INSURANCE $260,873.20 $196,286.30MANAGEMENT FEES $0.00 $87,000.00PROFESSIONAL FEES $267,039.00 $163,249.10UTILITIES / PHONE $145,377.67 $107,151.56OTHER $201,865.40 $53,055.75
IEARNINGS BEFORE INTEREST, TAXES, DEPRECIATION $22,995.95 $1,219,514.16~
AMORTIZATION (NOTE 1) $729,361.11 $729,360.37INTEREST EXPENSE $281,687.73 $373,007.61
IINC0ME BEFORE INCOME TAXES ~$988,052.89 $117,146.181
OPPORTUNITIES
DESCRIPTION TYPE VALUE TIMELINE
INFRASTRUCTURE
BEAVER MINES PUBUC TENDER $15 M SUMMER 2016UTILITY REPLACEMENT
REGINA BYPASS RELOCATION SUBCONTRACT $3 M SPRING 2016GRAHAM
RENTAL EQUIPMENT INCOME
KNIBB DEVELOPMENT PALL 2015
ALBERTA ROCK FALL 201$
BIG BORE FALL 201$
NORTH DAKOTA PROSPECTS
VANTAGE PIPELINE PRIVATE $15 M SUMMER 2016
VARIOUS INFRA5TRUCrURE
SASK PROJECTS
YUAN COAL - SECTIONS PUBLIC/PRIVATE $40 M SPRING 2017
YUAN COAL - SECTIONS PUBLIC/PRIVATE $40 M SPRING 2017
K+S - SECTION 1 PUBLIC/PRIVATE $40 M SPRING 2015
<+5 - SECTION 2 PUBLIC/PRIVATE $40 M SPRING 2018
MANITOBA WATER SERVICE BOARD
RURAL WATER DISTRIBUTIONS PUBLIC $5 M SPRING 2016
RURAL WATER DISTRIBUTIONS PUBLIC $5 M SPRING 2016
RURAL WATER DISTRIBUTION 3 PUBLIC $5 M SPRING 2016
WATERSHED FLOOD REMEDIATION
VARIOUS $500 K WINTER 2015/SPRING 2016
ENERGY
ADVANTAGE PIPELINE OIL/PRIVATE $5 M JANUARY 2016 CONSTRUCTION12 KM OF 16 & 5~
MODERN RESOURCES OIL/PRIVATE $5 M FEBRUARY 2016 CONSTRUCTION20 KM OF 10
MOOERN RESOURCES OIL/PRIVATE $3 M FEBRUARY 2016 CONSTRUCTION
3 HOD CROSSINGS
TERRADO OIL/PRIVATE $10 M PENDING FUNDING17KM OF 36~
PROSPECTS
OWNER DESCRIPTION AREA TIMELINE
SMRWSC MONITOR TRANSMISSION LINE EAST ALBERTA 2016
MOOSE JAW BUFFALO POUND WATER TWINNING MOOSE JAW 2016
TRANSGAS GAS LINE RELOCATIONS REGINA 2016
ALLIANCE REGINA BYPASS RELOCATION REGINA 2016
ESTERHAZY WATER TRANSMISSION COOPERATIVE ESTERHAZY 2016
SASKPOWER SWIFT CURRENT PLANT- CIVIL WORKS SWIFT CURRENT 2016
CPR INTERMODELYARD-CIVILWORKS EDMONTON 2016
MOSAIC BELLE PLAIN PIPELINE EXPANSION ESTERHAZY 2016
COOP REFINERY INFRASTRUCTURE RELOCATION SWIFT CURRENT 2016
DAMEN RESOURCES GAS GATHERING & TRANSMISSION MONTANA 2016
SUNCOR MEADOW LAKE FORT MCMURRAY 2019
HUSKY TRANSMISSION MAIN CLIVE 2016
G
Appendix G
Chinook Pipeline Inc. and Chinook Pipeline Limited Partnership unaudited internal BalanceSheets as at December 10, 2015
Notes:
S 3793,021 S 2,562,588
S 1,049,046 S 1,049,046S 10,261,777 S 3,500,0005 11,310,823 S 4,549,046
$ 15103,844 $ 7,111,634
S 125,738 S 125,738S - S 6,642,432S 125,738 S 6,768,170
5 7,644,558 $ 6,372,9115 7,644,558 S 6,372,911
S 12,002 5 -
5 7,177,467 S (6,029,447)5 144,026 S -
S 53 $ -
5 7,333,549 S (6,029,447)
$ 15,103,844 $ 7,111,634
1 Information imported from CPI accounting system as of the balance sheet date.
2 The Receiver’s valuation based on estimated net realizable value (also see further notes).
3 Assumed cash amounts (un-reconciled cash balances) based on CPI accounting data as at the balance sheet date.
For the purposes of this specific analysis, it is assumed that the cash amounts reported on CPI’s balance sheet was available
cash on hand.
4 Assuming no realizeable value on intercompany AR balances based on initial work carried Out by the Receiver on the
company’s accounts receivable as at the date of receivership. Full value of non-intercompany accounts receivable was assigned.
5 Assuming a realizable value of 100% of CPI’s book value.
6 Assuming a realizable value for land equal to 100% of CPI’s book value.
7 Receiver’s valuation is based on Statement of Affairs amount used in CPI’s bankruptcy filing. The Receiver will update this figure
based on the outcome of the sales and marketing process,
8 Receiver’s valuation assumes claims are provable.
9 Receiver’s valuation based on amounts provided byATB.
10 Receiver’s valuation is the estimated deficiency between the value of assets and liabilities.
Chinook Pipeline Inc ( CPI
Balance Sheet Analysis Unaudited
Balance Sheet As At December10 2015
Per Receiver’sPer CPI Accounting Valuation! Analysis
Item System N~t1) (Not.2) Notes
Current Assets:Cash S 2,207,055 S 2,207055 3AIR & Intercompany AIR $ 1,542,216 $ 311,783 4WIP and Inventory $ 43,750 S 43,750 5
rolal Current Assets
Capital Assets:Land 6Machinery I Vehilces / Equipment _____________________________________________ 7
Total Capital Assets
TOTAL ASSETS
Current Liabilities:AlP and Accruals 8Primary borrower Obligations _____________________________________________ 9
Total Current Liabilities
Long Term Debt:Long Term Debt and Guarantor Obligations _____________________________________________ 9
Total Long Term Debt
Equity:Share CapitalRetained Earnings 10Current EarningsDividends
Total Equity ____________________________________________________
TOTAL LIABILITIES & EQUITY
Notes:
$ 16280481 $ 1,601,513
$ 121,860 $ -
$ 121,860 $ -
S 16,402,341 $ 1,601,513
S 6,367,402 $ 6,367,402
S 6,330,537 $ 6,372,911
$ 12,697,938 $ 12,740,313
$ (7,037) $ 6,642,432
$ (7,037) $ 6,642,432
5 3,724,829 $ -
$ (1,261,519) $ (17,781,231)
$ 1,247,462 $ -
$ 668 $
5 3,711,439 $ (17,781,231)
S 16,402,341 $ 1,601,513
1 Information imported from CPLP accounting system as of the balance sheet date.
2 The Receiver’s valuation based on estimated net realizable value (also see further notes).
3 Assumed cash amounts (un-reconciled cash balances) based on CPLP accounting data as at the balance sheet date.
For the purposes of this specific analysis, it is assumed that the cash amounts reported on CPLP’s balance
sheet was available cash on hand.
Given that the cash recorded on CPLP’s balance sheet is a negative balance, the valuation of cash is nil.
4 Assuming no realizeable value on intercompany AR balances based on initial work carried out by the Receiver on the
company’s accounts receivable as at the date of receivership. Full value of non-intercompany accounts receivable was assigned.
5 Assuming a realizable value of 100% of CPLP’s book value of inventory.
6 Receiver’s valuation is based on the fact that all assets reside with CPI and as such the value of assets are recorded
on CPLP’s balance sheet is nil.
7 Receiver’s valuation assumes claims are provable.
8 Receiver’s valuation based on amounts provided by ATB.
Chinook Pipeline Limited Partnership ( CPLP
Balance Sheet Analysis Unaudited
~Balance Sheet As At December10, 2015
Per CPLP Accounting Per Receiver’sSystem (Note 1) Valuation I Analysis
Note 2)Item Notes
Current Assets:
Cash $ (36,020) $ - 3
A/R& Intercompany AiR $ 15,193,488 $ 1,056,000 4
WIP, Inventory and Prepaid Expenses $ 1,123,013 $ 545,513 5
Total Current Assets
Capital Assets:
Machinery I Vehilces I Equipment 6
Total Capital Assets
TOTAL ASSETS ______________________________________
Current Liabilities:
NP and Accruals 7
Primary borrower Obligations 8
Total Current Liabilities
Long Term Debt:
Long Term Debt and Guarantor Obligations 8
Total Long Term Debt
Equity:
Share Capital
Retained Earnings 9
Current Earnings
Dividends
Total Equity _________________________________________________
TOTAL LIABILITIES & EQUITY
9 Receiver’s valuation is the estimated deficiency between the value of assets and liabilities.
H
Appendix H
Chinook Pipeline Inc. and Chinook Pipeline Limited Partnership unaudited internal BalanceSheets as at March 1, 2016
Notes:
$ 3,356,898 $ 1,845,060
$ 1,049,046 $ 1,049,046S 10,226,614 $ 3,500,000S 11,275,660 $ 4,549,046
$ 14,632,559 $ 6,394,106
$ 107,032 $ 107,032
$ - $ 6,261,638
$ 107,032 $ 6,368,670
$ 7,211,189 $ 6,329,631$ 7,211,189 $ 6,329,631
$ 12,002 $ -
$ 7,177,467 $ (6,304,194)
S 124,814 $ -
$ 53 $ -
$ 7,314,337 $ (6,304,194)
$ 14,632,559 $ 6,394,106
1 Information imported from CPI accounting system as of the balance sheet date.
2 The Receiver’s valuation based on estimated net realizable value (also see further notes).
3 Assumed cash amounts (un-reconciled cash balances) based on CPI accounting data as at the balance sheet date.
For the purposes of this specific analysis, it is assumed that the cash amounts reported on CPI’s balance sheet was
available cash on hand.
4 Assuming no realizeable value on intercompany AR balances based on initial work carried out by the Receiver on the
company’s accounts receivable as at the date of receivership. Full value of non-intercompany accounts receivable was assigned.
5 Assuming a realizable value of 100% of CPI’s book value.
6 Assuming a realizable value for land equal to 100% of CPI’s book value.
7 Receiver’s valuation is based on Statement of Affairs amount used in CPI’s bankruptcy filing. The Receiver will update this figure
based on the outcome of the sales and marketing process.
8 Receiver’s valuation assumes claims are provable.
9 Receiver’s valuation based on amounts provided by ATB.
10 Receiver’s valuation is the estimated deficiency between the value of assets and liabilities.
Chinook Pipeline Inc ( CPI
Balance Sheet Analysis Unaudited
Balance Sheet As At March 1 2016
Current Assets:Item
Cash
Per CPI AccountingSystem (Note 1)
AIR & Intercompany A/R
WIP and InventoryTotal Current Assets
Per Receiver’sValuation I Analysis
(Note 2)
$$$
Capital Assets:
Notes
Land
1,489,5271,823,621
43,750
$$$
1,489,527311,78343,750
Machinery / Vehilces I EquipmentTotal Capital Assets
34
5
TOTAL ASSETS
Current Liabilities:NP and AccrualsPrimary borrower Obligations
Total Current Liabilities
67
Long Term Debt:Long Term Debt and Guarantor Obligations
Total Long Term Debt
Equity:
89
Share CapitalRetained EarningsCurrent EarningsDividends
Total Equity
9
TOTAL LIABILITIES & EQUITY
10
Notes:
$ 12,908,163 $ 1,601,513
$ 125,248 $ -
$ 125,248 $ -
S 13,033,411 $ 1,601,513
$ 4,248,049 $ 4248,049
$ 6,294,768 $ 6,329,631
$ 10,542,817 $ 10,577,679
$ (24,195) $ 6,261,638
$ (24,195) $ 6,261,638
$ 3,724,829 $ -
$ (1,261,519) $ (15,237,804)
S 50,812 $ -
$ 668 $ -
$ 2,514,790 $ (15,237,804)
S 13,033,411 $ 1,601,513
1 Information imported from CPLP accounting system as of the balance sheet date.
2 The Receiver’s valuation based on estimated net realizable value (also see further notes).
3 Assumed cash amounts (un-reconciled cash balances) based on CPLP accounting data as at the balance sheet date.
For the purposes of this specific analysis, it is assumed that the cash amounts reported on CPLP’s balance sheet was
available cash on hand.
Given that the cash recorded on CPLP’s balance sheet is a negative balance, the valuation of cash is nil.
4 Assuming no realizeable value on intercompany AR balances based on initial work carried out by the Receiver on the
company’s accounts receivable as at the date of receivership. Full value of non-intercompany accounts receivable was assigned.
5 Assuming a realizable value of 100% of CPLP’s book value of inventory.
6 Receiver’s valuation is based on the fact that all assets reside with CPI and as such the value of assets are recorded on CPLP’s
balance sheet is nil.
7 Receiver’s valuation assumes claims are provable.
8 Receiver’s valuation based on amounts provided by ATB.
Chinook Pipeline Limited Partnership ( CPLP
Balance Sheet Analysis Unaudited
Balance Sheet As At March 1,2016
Per CPLP Accounting Per Receiver’s Valuation I
Item System (Note ~ Analysis (Note 2) Notes
Current Assets:
Cash $ (2,209,424) $ - 3
NR & Intercompany AIR $ 13,994,575 $ 1,056,000 4
WIP, Inventory and Prepaid Expenses $ 1,123,013 $ 545,513 5
Total Current Assets
Capital Assets:
Machinery! Vehilces I Equipment 6
Total Capital Assets
TOTAL ASSETS
Current Liabilities:
NP and Accruals 7
Primary borrower Obligations 8
Total Current Liabilities
Long Term Debt:
Long Term Debt and Guarantor Obligations 8
Total Long Term Debt
Equity:
Share Capital
Retained Earnings 9
Current Earnings
Dividends
Total Equity _________________________________________________
TOTAL LIABILITIES & EQUITY
9 Receiver’s valuation is the estimated deficiency between the value of assets and liabilities.
I
Appendix I
Aged Accounts Payable listing as at April 1, 2016 for amounts owing to Craig Law LLP andspecific invoices
Chinook Pipeline Limited PartnershipSupplier Aged Detail As at 0110412016
Source Date Transacton Type Total Current 31 to 60 61 to 90 91+
CRAIG LAW LL.P
8215 10111/2014 Invoice 27,770.86 0.00 0.00 0.00 27,770.86
92 30109/2015 Payment -10,093.64 0.00 0.00 0.00 -10,093.64
1835 29101/2016 Payment -1,000.00 0.00 0.00 0.00 -1,000.00
8572 29/01/2015 Invoice 1,550.20 0.00 0.00 0.00 1,550.20
1160 17/04/2015 Invoice 1,404.15 0.00 0.00 0.00 1,404.15
1160 17/04/2015 Payment -1,404.15 0.00 0.00 0.00 -1,404.15
8922 13/05/2015 Invoice 203.18 0.00 0.00 0.00 203.18
9168 20/07/2015 Invoice 5,659.60 0.00 0.00 0.00 5,659.60
51 31/08/2015 Payment -5,659.60 0.00 0.00 0.00 -5,659.60
9206 28/07/2015 Invoice 203.18 0.00 0.00 0.00 203.18
9207 28/07/2015 Invoice 203.18 0.00 0.00 0.00 203.18
9335 02/09)2015 Invoice 203.18 0.00 0.00 0.00 203.18
9334 02109/2015 Invoice 203.18 0.00 0.00 0.00 203.18
9327 02)09/2015 lnvolce 203.18 0.00 0.00 0.00 203.18
9861 31/12/2015 InvoIce 224.18 0.00 0.00 0.00 224.18
9894 06/01/2016 Invoice 2,971.36 0.00 0.00 2,971.36 0.00
1877 24/02/2016 Invoice 2,000.00 0.00 2,000.00 0.00 0.00
1877 24/02/2016 Payment -2,000.00 0.00
Total outstanding:
Total unpald Invoices:
Total prepayments!prepald order:
Total outstanding:
-2,000.00 0.00 0.00
22,642.04 0.00 0.00 2,971.36 19,670.68
22,642.04 0.00 0.00 2,971.36 19,670.88
0.00 0.00 0.00 0.00 0.00
22,642.04 0.00 0.00 2,971.36 19,670.68
Generated On: 12/09/2016
Attn: Archie Craig
CRAIG LA WLLP3408 - 114th Avenue S.E.
Calgary. AB T2Z 3V6
Ph: 403-297-0130 Fax: 403-297-0133
RE: G~ne~1 .Matte’~’
STATEMENT OF ACCOUNT
Nov 26/14 Email to Amanda Post re: discharge of RBC security; review trust conditionsand closing documents.Review PPR Search Results.
Dec 09/14 Review ATB trust conditions; email to E]dor Wal re: PPR Registrations; emailto Archie Craig re: the same; email to Nicole Morand re: trust conditions.
Jan 07/15 Call from client. Draft letter to discharge lien.
To all emails. telephone calls, telecopies, facsimiles, letters, othercorrespondence, interoffice meetings, file reviews, legal reviews and otherinatte~s not ~peciflc~ily i;Uced above;
TOTAL FEES 5.50
OTHJi~R CHARGES
--
Chinook Pipeline Inc.Box 1480Pincher Creek, Alberta TOK 1 WO
Jan 06, 2016
10329894
File#:Jnv#:
Jan 08/15Jan 16/15Jan 22/15Feb 18/15May 11/15Jun 01/15Jun 16/15
Draft documents re discharge of lien.Draft documents re lien.Call client.Calls from client.Call client.Call client. Call other lawyer. Letter to other lawyer.Draft documents. Call client.
FacsimilesPhotocopies
TOTAL OTHER CHARGES
hours $2,505.00
$53.00$50.00
$103.00
DISBURSEMENTS
Courier $6.13Filing Fee $50.00Title Search* $50.00Searches - Business Debtor EWR fee (double posting refund) -$7.00Searches - Business Debtor Govt fee (double posting refund) -$1.00Searches - Corporate EWR fee (double posting refund) -$7.00Searches - Corporate Govt fee (double posting refund) -$3.00Searches - Business Debtor EWR fee $7.00Searches - Business Debtor Govt fee $1.00Searches - Business Debtor EWR fee $7.00Searches - Business Debtor Govt fee $1.00Searches - SK PPR EWR fee $12.00Searches - SK PPR Govt fee $6.00Courier Oct 2~, 20H $j7.73Courier Oct 31, 2014 $22.63Courier Nov 20, 2014 $12.25Registration Fee * $20.00Courier - Purolator (Dec 15, 2014) $30.46
TOTAL DISBURSEMENTS $225.20
Total GST $138.16
TOTAL FEES, DISBURSEMENTS & GST $2,971.36
GST #:85105 8529* tax-exemptE&OE
CRAIG LAW LLP
Per: }~ ~R. Kipp Craig
CRAIG LAW LLP3408 - 114th Avenue S.E.
Calgary, AB T2Z 3V6
Ph: 403-297-0130 Fax: 403-297-0133
Christie Ridge Enterprises Inc. Dec 31, 2015Box 1480Pincher Creek, Ab TOK IWO
File#: 1329Bud Craig mv #: 9861
RE: Corporate Matters
DESCRIPTION AMOUNT
To all matters with respect to acting as registered office for the corporation for the 150.00past year, preparation and filing ofAnnual Return, preparation of annual minutes,seeing to execution of documents and reporting to client
GSTon Fees $7.50
Disbursements
Annual Return registry filing fee $63.50
Total Disbursements $63.50GST on Disbursements $3.18
TOTAL FEES, DISBURSEMENTS & GST $224.18
Total Tax: $10.68GST#: 85105 8529
* tax-exempt
CRAIG LAW LLP
PER: ________________
R. Kipp Craig
//r/~
CRAIG LAW LLP3408 - 114th Avenue S.E.
Calgary, AB T2Z 3V6
Ph: 403-297-0130 Fax: 403-297-0133
Chinook Pipelne Ltd. Sep 02, 2015Box 1480Pincher Creek, Alberta TOK iWO Canada
File #: 5293Archie Craig mv #: 9335
RE: Corporate Matters
DESCRIPTION AMOUNT
To all matters with respect to acting as registered office for the corporation for 150.00the past year, preparation and filing of Annual Return, preparation of annualminutes, seeing to execution of documents and reporting to client
GST on Fees $7.50Disbursements
Annual Return registry filing fee $43.50
Total Disbursements $43.50
GST on Disbursements $2.18
TOTAL FEES, DISBURSEMENTS & GST £203.18
Total Tax: $9.68GST#:* 851058529tax-exemptE&OE
CRAIG LAW LLP
PER: /≤~1i1 ~L%~z9~~17~c//≤EiR. Kipp Craig
CRAIG LAW LLP3408 - 114th Avenue S.E.
Calgary, AB T2Z 3V6
Ph: 403-297-0130 Fax: 403-297-0133
Chinook Pipeline Inc. Sep 02, 2015Box 1480Pincher Creek, Alberta TOK IWO
File #: 1327Archie Craig mv #: 9334RE: Corp
DESCRIPTION AMOUNT
To all matters with respect to acting as registered office for the corporation for the 150.00past year, preparation and filing ofAnnual Return, preparation of annual minutes,seeing to execution of documents and reporting to client
GST on Fees $7.50
Disbursements
Annual Return registry filing fee $43.50
Total Disbursements $43.50GST on Disbursements $2.18
TOTAL FEES, DISBURSEMENTS & GST $203.18
Total Tax: $9.68851058529tax-exempt
CRAIG LAW LLP
PER: _____________ .
R. Kipp Craig ~
CRAIG LAW LLP3408 - 114th Avenue S.E.
Calgary, AB T2Z 3V6
Ph: 403-297-0130 Fax: 403-297-0133
Christie Environmental Jnc. Sep 02, 2015Box 14801164 Buffalo StreetPincher Creek, AB TOK IWO
File#: 2522
mv #: 9327RE: Corporate Matters
DESCRIPTION AMOUNT
To all matters with respect to acting as registered office for the corporation for the I so.oopast year, preparation and filing ofAnnual Return, preparation of annual minutes,seeing to execution of documents and reporting to client
GST on Fees $7.50
Disbursements
Annual Return registry filing fee $43.50
Total Disbursements $43.50GST on Disbursements $2.18
TOTAL FEES, DISBURSEMENTS & GST $203.18
Total Tax: $9.6885105 8529
tax-exempt
CRAIG LAW LLP
PER: M~~6~1 Locklynn T. Craig
CRAIG LAW LLP3408 - 114th Avenue S.E.
Calgary, AB T2Z 3V6
Ph: 403-297-0130 Fax: 403-297-0133
Chinook Construction Inc. Jul 28, 2015Box 1480Pincher Creek, AB TOK IWO
File#: 3179mv #: 9206
RE: Corporate Matters
DESCRIPTION V AMOUNT
To all matters with respect to acting as registered office for the corporation for the 150.00past year, preparation and filing ofAnnual Return, preparation of annual minutes,seeing to execution of documents and reporting to client
GST on Fees $7.50
Disbursements
Annual Return registry filing fee $43.50
Total Disbursements $43.50GST on Disbursements V $2. 18
TOTAL FEES, DISBURSEMENTS & GST $203.18
Total Tax: $9.68
851058529tax-exempt
CRAIG LAW LLP
PER: ~
Locklynn T. Craig
CRAIG LAW LLP3408- 114th Avenue S.E.
Calgary, AB T2Z 3V6
Ph: 403-297-0130 Fax: 403-297-0133
Christie Ridge Enterprises Inc. May 13, 2015Box 1480Pincher Creek, Ab TOK IWO
File#: 1329Bud Craig mv #: 8922RE: Corporate Matters
DESCRIPTION AMOUNT
To all matters with respect to acting as registered office for the corporation for the 150.00past year, preparation and filing ofAnnual Return, preparation of annual minutes,seeing to execution of documents and reporting to client
GST on Fees $7.50
Disbursements
Annual Return registry filing fee $43.50
Total Disbursements $43.50GSTon Disbursements $2.18
TOTAL FEES, DISBURSEMENTS & GST $203.18
Total Tax: $9.68
851058529tax-exempt
CRAIG LAW LLP
PER: ~i1R. Kipp Craig LA-S
CRAIG LAW LLP3408 - 114th Avenue S.E.
Calgary, AB T2Z 3~,76
Ph: 403-297-0130 Fax: 403-297-0133
1466264 Alberta Ltd. Jul 28, 2015Box 1480Pincher Creek, Alberta TOK IWO Canada
File#: 5291Noble John Craig, Jr. mv #: 9207RE: Corporate Matters
DESCRIPTION AMOUNT
To all matters with respect to acting as registered office for the corporation for the 150.00past year, preparation and filing ofAnnual Return, preparation of annual minutes,seeing to execution of documents and reporting to client
GST on Fees $7.50
Disbursements
Annual Return registry filing fee $43.50
Total Disbursements $43.50GST on Disbursements $2.18
TOTAL FEES, DISBURSEMENTS & GST $203.18
Total Tax: $9.6885105 8529tax-exempt
CRAIG LAW LLP
PER: ____________
R.Kipp Craig
CRAIG LAWLLP3408- 114th Avenue S.E.
Calgaiy, AB T2Z 3V6
Jul 20,2015
60379168
CourierTitle Search*Mortgage amendment fee - loan sub# 3311057
InsuranceRegistration Fee *
Land Titles - Copy of InstrumentDo Process software feeTotals
Total GST
19.3850.00
142.86
4,761.90350.0050.0035.00
$5,409.14
$250.46
GST#:* tax-exempt
Total Fees, Disbursements & GST
85105 8529
$5,659.60
CRAIG LAW LLP
Per: ;.WW ~c~4eJn
~2~Lock1ynn T. Craig
Ph: 403-297-0130 Fax: 403-297-0133
Archie Craig
Attn:
RE: SwapfromNE 1/4 15-5-5-W5Mto SW l/423-S-l-W5M&AFSCMortgage
DISBURSEMENTS
File#:mv #:
CRAIG LA W LLP3408 - 114th Avenue S.E.
Calgary, AB T2Z 3V6
Ph: 403-297-0130 Fax: 403-297-0133
Chinook Pipeline Inc. Mar 18, 2014Box 1480Pincher Creek. AB TOK IWO
FiIe#: 1032mv #: 7493
Attn: Archie Craig
RE: General MattersSTATEMENT OF ACCOUNT
Nov 27/13 Review documents. Call client.Dec 05/13 Review documents.Dec 20/13 Call from client re: lien.Jan 15/14 Calls to client.
To all emails, telephone calls, telecopies, facsimiles, letters, other correspondence,interoffice meetings, file reviews, legal reviews and other matters not specifically notedabove.
Total Fees 2.10 hours $945.00Patronage Reduction $45.00
TOTAL FEES AFTER REDUCTION $900.00
DISBURSEMENTSRegistration Fee - Caveat and Certified Land Title - 091026327 +1 * $40.00Registration Fee - Caveat and Certified Land Title - 091026327* $40.00Courier - dated Sept 4, 2012 16.84
Total Disbursements $96.84
fotalGSI $45.84
TOTAL FEES, DISBURSEMENTS & GST $1,042.68
GST#:85105 8529* tax-exempt
CRAIG LAW LLP
Per: ________________
R. Kipp Craig
CRAIG LAW LLP3408 - 114th Avenue S.E.
Calgary, AB T2Z 3V6
Ph: 403-297-0130 Fax: 403-297-0133
Chinook Pipeline Inc. Dec 04, 2013Box 1480Pincher Creek, Alberta TOK IWO
File#: 1327
Archie Craig mv #: 7176
RE: Corp
DESCRIPTION AMOUNT
To all matters with respect to acting as registered office for the corporation for 150.00the past year, preparation and filing of Annual Return, preparation of annualminutes, seeing to execution of documents and reporting to client
OTHER CHARGES
Paralegal fees regarding review of minute book, re-organizing $400.00same, preparation and filing annual returns; updating corporateprofile. ——
Total Other Charges $400.00GST on Fees $27.50
DISBURSEMENTS
Searches - articles of amendment 143.00Annual Return registry filing fee 12.50Annual Return registry filing fee - Minister of Finance fee* 30.01)
Totals $185.50GST on Disbursements $7.78
Total Fees, Disbursements & GST - $770.78
Total Tax: $35.28
‘e~mpt 85105 8529
CRAIG LAW LLPPER:
R. Kipp Ci’aig
