I Dare You To Touch It with a 10 Foot Poll

We have an update on how the straw poll was tallied from meetings on January 15, as well as a little bit of insight into steps for investors in the not too distant future.

A couple of days ago the District office released the results of the straw poll taken at investors meetings a on January 15. The results were as follows:

Total number of preferences: 903
Total number of preferences for option 1 (Liquidation): 178
Total number of preferences for option 2 (Explore Restructuring): 629
Total number of people who required more information: 96

According to a post on the CEF website, the votes are a head-count vote and not weighted according to investment as initially promised.

The CEF site explained the results this way:

As you will have heard at the meetings, our original intention was to look at both number of individuals voting each way as well as the dollar value associated with each group.  However, as it became apparent that it might become necessary to go CCAA, we simply compiled the numbers for the individual responses at this point.  Only 34% of the account holders voted.

Our intention through this poll was to determine, at a high level, a direction for us to explore. As the number of requests for transfers was significant, we had to change direction and go through the CCAA process. The CCAA process does include a creditors vote – this will be a much more formal and stringent process, administered and reviewed by the Monitor. More details on any future meetings and votes will be available later in the CCAA process.
So there’s not just a clue, but some black-and-white clarity about the process. At some point in the near future the creditors – in CEF’s case, the investors – will have a vote on how the process will proceed. That may not actually be news since it’s part of the CCAA process, but I haven’t read the entire CCAA legislation because I need my beauty sleep. Then again, that’s not working out so well, so maybe I should read the whole act after all.

8 thoughts on “I Dare You To Touch It with a 10 Foot Poll

  1. s

    You’re right but maybe not completely pointless. The information from those polls was used to support their statements and this may not have been the same support if based on dollar value. It was used in the affidavit of Kurt Robinson.


    Point #103… “The District also held meetings with the CEF Depositors on January 15 and 16, 2015 to explain the situation and to obtain their preference on a way forward. IDEALLY, IT WAS THE HOPE OF THE APPLICANTS THAT THE CEF DEPOSITORS WOULD BE AMENABLE TO A FORM OF RESTRUCTURING AND THAT THE RESTRUCTURING WOULD BE ABE TO BE CARRIED OUT ON AN INFORMAL BASIS OUTSIDE OF THE COURT.

    #104 The CEF Depositors who attended the meetings mixed a range of emotions from anger to full support and understanding. They were asked to express their preference on either having the Districts’s assets liquidated or being involved in a restructuring process. There were numerous CEF Depositors who expressed that they needed further information before they would feel comfortable expressing a preference on either option. However, of those who expressed a preference on the options presented, the majority preferred to be involved in a restructuring process.

    It would be interesting to know of the 34% that voted, how much of the value of the funds was represented too. I can’t imagine those heavily invested choosing not to be a part of the poll.

    • Good points. Though at the meetings I attended serious speakers voiced serious concerns about the lack of information, and how they were being asked to vote with little more information than “CEF is insolvent.” The Edmonton area meetings were told if they wanted more information they needed to vote for restructuring (option 2). If that message was consistent across the meetings, it’s possible that the vote indicates people were voting for more information. To put it another way, option one is “liquidate and fly blind,” and option is tied to getting more information — so it may appear that there’s support for restructuring, but it’s just as likely people want information.

      Further to that, the restructuring process, as outlined in the Deloitte pre-filing document, shows that restructuring started in the summer of 2014…6 or 7 months before investors knew there was a problem.

      Ultimately the vote had no teeth. If/when the vote goes to creditors via the CCAA process, and options are presented, options won’t be tied to getting more information. Everyone will have a clear financial picture and they’ll be able to make an informed decision.

  2. jhuber

    I thought there were 2600 investors…and only 903 opinions expressed??

    • Apparently the results are only 34% of eligible voters. So it’s by no means a complete representation. While it doesn’t render confidence in the process, the vote is pointless anyway. Reportedly there will be a vote that will be conducted by the monitor (Deloitte) at some point.

  3. s

    At the significant investor meeting we attended, it was made explicitly clear that the votes would be weighted by the amount invested.

    • Larry

      Don’t you *love* the consistency!

      • The consistency is what worries me, if you know what I mean.

  4. Larry

    At our meeting we were told the straw vote was simply a head count, not a “value invested” vote.

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