COURT FILE NUMBER 1801-16722

CLERK OF THE COUR FILED

MAY 0 8 2019

JUDICIAL CENTRE OF CALGARY

COURT

JUDICIAL CENTRE

PROCEEDINGS

DOCUMENT

ADDRESS FOR SERVICE AND CONTACT INFORMATION OF PARTY FILING THIS DOCUMENT

COURT OF QUEEN'S BENCH OF ALBERTA IN BANKRUPTCY AND INSOLVENCY

CALGARY

IN THE MATTER OF THE RECEIVERSHIP OF R.I.I. NORTH AMERICA INC.

APPLICATION by COURT-APPOINTED RECEIVER (Approval of Sale Process and Distributions)

Norton Rose Fulbright Canada LLP 400 3rd Avenue SW, Suite 3700 Calgary, Alberta T2P 4H2 CANADA

Attention: Howard A. Gorman, QC and Aditya Badami

Telephone: +1 403.267.8144 Facsimile: +1 403.264.5973 howard.Aormahanortonmsefulbrinht.corn

atlit•a.badami@nortonrosefulbright.com

File No. 1001055736 Box No. 39

Notice to the Respondents

This application is made against you. You are a respondent.

You have the right to state your side of this matter before the judge.

To do so, you must be in Court when the application is heard as shown below:

Date Time Where Before Whom

May 15. 2019 3:00 P.M. Calgary Courts Centre Honourable Mr. Justice C. Jones

Go to the end of this document to see what else you can do and when you must do it.

Remedy claimed or sought:

1. Hardie & Kelly Inc. solely in its capacity as Receiver and Manager (the Receiver) of R.I.I. North America Inc. (the Debtor) applies for an order, substantially in the form attached as Schedules A and B hereto:

(a) declaring that this Application is properly returnable on May 15, 2019, and that service of this Application and all supporting materials on the service list is validated and deemed good and sufficient;

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(b) approving the sale process attached as an appendix to the First Report of the Receiver (the Sale Process);

(c) authorizing the Receiver to implement the Sale Process, and to perform all steps and actions required of them pursuant to the Sale Process;

(d) authorizing the Receiver to make an interim distribution in the approximate amount of $550,000 to Espresso Capital Ltd. (Espresso), the Debtor's first-secured creditor;

(e) authorizing the Receiver to make a final distribution in the approximate amount of $307,000 to the Saskatchewan Ministry of Energy and Resources (MER), with respect to a public duty owed by the Debtor's estate;

(f) authorizing the Receiver to make a final distribution in the amount of $12,000 to Employment and Social Development Canada (ESDC), the subrogated claimant of each of six certain former employees of the Debtor entitled to such funds in accordance with section 81.4(5) of the Bankruptcy and Insolvency Act (BIA), and the Wage Earner Protection Program Act (WEPPA); and

(g) such further and other relief as counsel may advise and as this Honourable Court may permit.

Grounds for making this application:

2. The Receiver was appointed by order, issued by the Honourable B. E. C. Romaine on November 29, 2018 (the Receivership Order).

3. The Receiver, in consultation with its legal counsel, and one of the former principals of the Debtor, has developed the Sale Process in order to facilitate an open, fair, and efficient process to solicit bids for the property and assets of the Debtor as such property and assets are defined in the Receivership Order.

4. The Receiver's view is that the Sale Process is in the best interests of the stakeholders of the Debtor.

5. Espresso is the Debtor's first-secured creditor, subject only to the public duty claim of the MER and the subrogated claim of ESDC pursuant to the BIA and WEPPA. The proposed interim distribution to Espresso is just, appropriate, and in the best interests of the administration of the receivership estate.

6. The MER filed a Proof of Claim in the parallel bankruptcy proceedings of the Debtor in the approximate amount of $307,000 in respect of environmental liabilities associated with the Debtor's estate. The MER has asserted an effective priority claim in respect of that amount. The proposed final distribution to MER is just, appropriate, and in the best interests of the administration of the receivership estate.

7. Six former employees of the Debtor filed claims pursuant to WEPPA and, in accordance with the BIA, those claims are entitled to priority payment.

8. Such further and other grounds as counsel may advise.

Material or Evidence to be relied on:

9. The First Report of the Receiver, filed concurrently with this Application.

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10. The Receivership Order.

11. Such further and other materials as counsel may advise.

Applicable Rules:

12. Rule 6.3(1) and 6.9 of the Alberta Rules of Court.

13. Such further and other Rules as counsel may advise.

Applicable Acts and regulations:

14. The Bankruptcy and Insolvency Act.

15. The Wage Earner Protection Program Act.

16. The Alberta Rules of Court.

17. Such further and other Acts and regulations as counsel may advise.

Any irregularity complained of or objection relied on:

18. There are no irregularities complained of or objections relied on.

How the application is proposed to be heard or considered:

19. It is proposed that the application be heard in person with one, some or all of the parties present.

WARNING

If you do not come to Court either in person or by your laywer, the Court may give the applicant(s) what they want in your absence. You will be bound by any order that the Court makes. If you want to take part in this application, you or your lawyer must attend in Court on the date and at the time shown at the beginning of the form. If you intend to rely on an affidavit or other evidence when the application is heard or considered, you must reply by giving reasonable notice of the material to the applicant.

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COURT FILE NUMBER

COURT

JUDICIAL CENTRE

APPLICANT

DOCUMENT

ADDRESS FOR SERVICE AND CONTACT INFORMATION OF PARTY FILING THIS DOCUMENT

SCHEDULE A

1801-16722

COURT OF QUEEN'S BENCH OF ALBERTA

CALGARY

IN THE MATTER OF THE RECEIVERSHIP OF R.I.I. NORTH AMERICA INC.

Clerk's Stamp

HARDIE & KELLY INC. in its capacity as Court-appointed receiver and manager of the current and future assets, undertakings and properties of R.I.I. NORTH AMERICA INC.

ORDER (Approval of Sales Process)

Norton Rose Fulbright Canada LLP 400 3rd Avenue SW, Suite 3700 Calgary, Alberta T2P 4H2

Phone: +1 403.267.8222 Fax: +1 403.264.5973 Email: howard.gorman@nortonrosefulbright.com /

aditya.badami@nortonrosefulbright.com

Attention . Howard A. Gorman, Q.C. / Aditya M. Badami File No.. 1001055736

DATE ON WHICH ORDER WAS PRONOUNCED:

May 15, 2019

NAME OF JUSTICE WHO MADE THIS ORDER:

The Honourable Justice C. M. Jones

LOCATION OF HEARING:

Calgary, Alberta

UPON THE APPLICATION of Hardie & Kelly Inc., in its capacity as Court-appointed Receiver (the Receiver) of the current and future assets, undertakings and properties of R.I.I. North America Inc. (RII); AND UPON HAVING READ the Receivership Order dated November 29, 2018, filed; AND UPON HAVING READ the First Report of the Receiver dated May 6, 2019, filed (the First Report); AND UPON HEARING FROM counsel for the Receiver and any other parties present:

IT IS HEREBY ORDERED AND DECLARED THAT:

1. Service of the Application filed on May 6, 2019 is hereby validated and deemed good and sufficient and this Application is properly returnable today.

2. The Sales Process attached as Appendix D to the First Report is hereby approved and the Receiver is authorized and directed to implement the Sales Process and to perform all steps and actions required of it pursuant to the Sales Process.

3. The Receiver is at liberty to reapply for further advice and direction as may be necessary to give full force and effect to the terms of this Order.

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4. Service of this Order by e-mail, facsimile, courier, regular mail or personal delivery shall constitute good and sufficient service of this Order.

Honourable Mr. Justice C. M. Jones

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COURT FILE NUMBER

COURT

JUDICIAL CENTRE

APPLICANT

DOCUMENT

ADDRESS FOR SERVICE AND CONTACT INFORMATION OF PARTY FILING THIS DOCUMENT

SCHEDULE B

1801-16722

COURT OF QUEEN'S BENCH OF ALBERTA

CALGARY

IN THE MATTER OF THE RECEIVERSHIP OF R.I.I. NORTH AMERICA INC.

Clerk's Stamp

HARDIE & KELLY INC. in its capacity as Court-appointed receiver and manager of the current and future assets, undertakings and properties of R.I.I. NORTH AMERICA INC.

ORDER (Interim and Final Distributions) Norton Rose Fulbright Canada LLP 400 3rd Avenue SW, Suite 3700 Calgary, Alberta T2P 4H2 Phone: +1 403.267.8222 Fax: +1 403.264.5973 Email: howard.gorman@nortonrosefulbright.com /

aditya.badami@nortonrosefulbright.com

Attention: Howard A. Gorman, Q.C. / Aditya M. Badami File No.: 1001055736

DATE ON WHICH ORDER WAS PRONOUNCED: May 15, 2019

LOCATION WHERE ORDER WAS PRONOUNCED: Calgary, Alberta

NAME OF JUSTICE WHO MADE THIS ORDER: Honourable Mr. Justice C. M. Jones

UPON THE APPLICATION of Hardie & Kelly Inc. in its capacity as court-appointed receiver and

manager (the Receiver) of the current and future assets, undertakings and properties of R.I.I. North

America Inc. (the Debtor); AND UPON HAVING READ the Receivership Order dated November 29,

2018 (the Receivership Order), and the First Report of the Receiver filed May 6, 2019 (First Report);

AND UPON hearing counsel for the Receiver and any other interested parties that may be present; AND

UPON IT APPEARING that all interested and affected parties have been served with notice of this

Application; AND UPON having read the pleadings, proceedings, orders and other materials filed in this

action;

IT IS HEREBY ORDERED AND DECLARED THAT:

SERVICE

1. Service of notice of this application and supporting materials is hereby declared to be good and

sufficient, and no other person is required to have been served with notice of this application, and

time for service of this application is abridged to that actually given.

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INTERIM DISTRIBUTION

2. The Receiver is authorized and directed to make an interim distribution to Espresso Capital Ltd.

in the amount of $550,000.00 as described in paragraphs 32-37 of the First Report.

FINAL DISTRIBUTIONS

3. The Receiver is authorized and directed to make a final distribution to the Saskatchewan Ministry

of Energy and Resources (MER) in accordance with the proposed final distribution described in

paragraphs 32-37 of the First Report; with such final distribution being in full and final satisfaction

of the claim made by MER as against the Debtor's estate.

4. The Receiver is authorized and directed to make a final distribution to Employment and Social

Development Canada (ESDC) in accordance with the proposed final distribution described in

paragraphs 32-37 of the First Report; with such final distribution being in full and final satisfaction

of the claim made by ESDC as subrogated claimant of the six individual former employees of the

Debtor who submitted WEPPA claims, and as against the Debtor's estate.

MISCELLANEOUS

5. The Receiver may reapply for further advice and direction as necessary to give full force and

effect to the terms of this Order.

6. Service of this Order by e-mail, facsimile, courier, regular mail or personal delivery shall constitute

good and sufficient service of this Order.

Honourable Mr. Justice C. M. Jones

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