The applicant, Tacora Resources Inc., sought approval for an Amended and Restated Debtor in Possession (DIP) financing agreement with Cargill and an extension of the CCAA Stay Period.
The Ad Hoc Group of Noteholders (AHG) opposed the Cargill DIP, proposing an alternative and seeking renegotiation of terms, including an exit fee, legal costs, and the "Offtake Condition" related to a pre-existing commercial agreement with Cargill.
The court approved the Cargill DIP and extended the stay, finding the Cargill agreement offered greater short-term stability and liquidity, was recommended by the Monitor, and did not materially prejudice other stakeholders beyond what already existed due to the pre-CCAA Offtake Agreement.
The court held that the DIP approval motion was not the appropriate forum to address the enforceability or commercial reasonableness of the Offtake Agreement itself.
