Laurentian University’s president said it remains LU’s goal to file a “plan of arrangement” before the courts by May 31 as it attempts to exit the insolvency restructuring process.
A plan of arrangement is essentially a plan put forward by an insolvent organization to pay out its creditors, and it must be approved by these creditors.
Back in January, Laurentian — which has been undergoing insolvency restructuring under the Companies’ Creditors Arrangement Act (or CCAA) since February 2021 — was granted a further extension of creditor protection until May 31.
Dr. Robert Haché said in an April 19 written report to Laurentian’s senate that the university and its advisors, with the assistance of the court-appointed monitor, are continuing to advance all aspects of the CCAA restructuring.
He said the goal is to file Laurentian’s Plan of Arrangement by May 31, but talks are still ongoing with the university’s stakeholders for the terms that will be offered under the plan. Prior to filing said plan, though, Haché said those terms need to be negotiated and included in court materials to be served by mid-May.
“That is our No. 1 priority over the next few weeks, and we and our advisors are committed to doing whatever it takes for that to be achieved,” Haché wrote.
“The timing is pivotal for a number of reasons, and will provide a path forward to exit from the CCAA process once a meeting of creditors and other steps are completed. More information on the CCAA Plan will be available in May.”
Back in February, in a previous report to Laurentian’s senate, Haché provided a bit more detail about what he expects the plan of arrangement process to be like.
He said when the university returns to court in May, it expects to present a request to the court for a “meeting order.”
He explained that a meeting order is the order that authorizes Laurentian to schedule a meeting of creditors to vote on a formal plan of arrangement, which would set out the terms under which they’d be paid out by LU.
Haché explained to members of LU’s senate that after the May 31 court date, there would be a six-week notice period for that meeting, “and then there’s a few other things that need to happen, but it clearly puts a timeline to the end of the CCAA process and the successful emergence of Laurentian from the CCAA process.”
During a discussion with senate members during the April 19 meeting, Haché emphasized that the plan of arrangement is a critical piece of the puzzle.
Just like Laurentian’s doors would have closed if cuts to LU employees and programs hadn’t taken place last year, the university’s doors could still close if the plan of arrangement is not successful, the university’s president said.
“If we don't successfully come to a plan of arrangement that is approved by creditors, the doors will close,” Haché said.
“That's still where we are. In getting out of this process, there are still steps along the way. The ultimate opportunity is for the university to emerge financially successful, financially sustainable, and to have the opportunity for a successful future. But there's still today no guarantee that that will occur.”
Heidi Ulrichsen is the associate content editor at Sudbury.com. She also covers education and the arts scene.