Sea Breeze Power Corp. Announces Approval of Restructuring Proposal

TSX-VENTURE: SBX.V

VANCOUVER, May 2, 2017 /CNW/ - On April 28, 2017 the Supreme Court of British Columbia (the "Court") approved the second amended proposal of Sea Breeze Power Corp. ("Power Corp.") and one of its wholly-owned subsidiaries, Sea Breeze Energy Inc. (together, "Sea Breeze" or the "Company"), dated April 21, 2017 (as amended, the "Proposal") pursuant to the Bankruptcy and Insolvency Act (the "BIA"). 

As a result of the Company's ongoing operational losses and increasing liabilities it was unable to meet its obligations to creditors and on December 30, 2016 the Company commenced proposal proceedings under the BIA. Through the proposal proceedings the Company has sought to (i) satisfy creditor claims, including the secured claims of certain shareholders of the Company (collectively, the "Secured Lender Group") that have advanced secured loans to the Company to fund its operations; (ii) maximize recoveries for unsecured creditors; and (iii) facilitate the continued development of the Company's many projects.

An earlier version of the proposal was approved by the Company's creditors at a meeting convened on January 18, 2017. The Proposal is expected to generate better recoveries for the Company's creditors than would be available in a bankruptcy and is designed to maximize the realizable value of the Company's assets.

The Proposal contemplates that it will be implemented as soon as practicable following Court approval and that upon implementation:

• the Secured Lender Group will transfer all of the common shares they own in Power Corp. to Tu-Can Energy LLC ("TuCan"), a limited liability company controlled by the Secured Lender Group;
  
  
• Power Corp. will issue an additional one billion common shares to TuCan, following which Power Corp.'s common shares will be consolidated at a rate of 25 million to 1; and
  
  
• all fractional shares and other securities of Power Corp., except for the common shares held by TuCan, will subsequently be cancelled, with the result that TuCan will be the sole shareholder of Power Corp.

Payments to the Company's unsecured creditors will be funded from various sources, including the Secured Lender Group and the sale of certain of the Company's assets.

The Company's existing management will remain in place.

Because certain members of the Secured Lender Group are directors of Power Corp., the Proposal may be considered a related party transaction under Multilateral Instrument 61-101. In the Order approving the Proposal, the Court confirmed that Power Corp. does not have to comply with sections 5.4 and 5.6 of Multilateral Instrument 61-101 and Power Corp. is entitled to rely on the exemptions set forth in subsections 5.5(f)(i) and 5.7(d) to obviate the need for obtaining a formal valuation in respect of the existing equity of the company and minority approval in respect of the transactions contemplated by the Proposal. 

As Power Corp.  will not meet the continued listing requirements of the TSX Venture Exchange (the "TSXV") upon completion of the implementation of the Proposal, Power Corp. intends to have its common shares delisted from the TSXV and apply to Canadian securities regulators to cease to be a reporting issuer.

Sea Breeze believes the Proposal provides the best possible outcome for its stakeholders in the circumstances and intends to implement the Proposal as soon as practicable.

Information concerning the Company's restructuring and the Proposal can be found on website of the proposal trustee, Alvarez & Marsal Canada Inc. (the "Proposal Trustee") at: www.alvarezandmarsal.com/seabreeze. Any inquiries concerning the Proposal may be directed to the Proposal Trustee.

Sea Breeze Power Corp. is a Vancouver-based renewable energy company focused on unlocking British Columbia's enormous but "stranded" renewable energy potential.  Sea Breeze has been engaged in the development of utility-scale wind farms, "run-of-river" hydroelectric projects, and through a joint venture, the development of state-of-the-art electricity transmission projects.

Neither TSX Venture Exchange nor its Regulation Services Provider accepts responsibility for the adequacy or accuracy of this release.

Cautionary Statement Regarding Forward-Looking Information and Statements

This news release includes certain forward-looking statements or information. All statements other than statements of historical fact included in this release, including, without limitation, statements regarding the Proposal are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Power Corp.'s  plans or expectations include risks relating to the failure to implement the Proposal and other risks detailed herein and from time to time in the filings made by Power Corp.

SOURCE Sea Breeze Power Corp.

Resja Campfens, 604-689-2991