CVE Cenovus Energy Inc

(1) Represents (a) 231,194,698 common shares, no par value per share (the “Common Shares”), of Cenovus Energy Inc. (the “Issuer”) held by L.F. Investments S.à r.l. and (b) 19,185,181 Common Shares that L.F. Investments S.à r.l. may purchase upon the exercise of warrants (the “Warrants”) within sixty days of January 11, 2021. The reporting persons expressly disclaim status as a group for purposes of this Schedule 13D.

(2) The ownership percentage is calculated based on an aggregate of 2,017,387,808 Common Shares, which the Issuer has informed the Reporting Persons was the total number of outstanding Common Shares immediately following the effectiveness of the Arrangement, and assuming exercise of all the Warrants referenced in footnote 1 above.

(1) Represents (a) 231,194,698 common shares, no par value per share (the “Common Shares”), of Cenovus Energy Inc. (the “Issuer”) held by L.F. Investments S.à r.l. and (b) 19,185,181 Common Shares that L.F. Investments S.à r.l. may purchase upon the exercise of warrants (the “Warrants”) within sixty days of January 11, 2021. The reporting persons expressly disclaim status as a group for purposes of this Schedule 13D.

(2) The ownership percentage is calculated based on an aggregate of 2,017,387,808 Common Shares, which the Issuer has informed the Reporting Persons was the total number of outstanding Common Shares immediately following the effectiveness of the Arrangement, and assuming exercise of all the Warrants referenced in footnote 1 above.

(1) Represents (a) 231,194,698 common shares, no par value per share (the “Common Shares”), of Cenovus Energy Inc. (the “Issuer”) held by L.F. Investments S.à r.l. and (b) 19,185,181 Common Shares that L.F. Investments S.à r.l. may purchase upon the exercise of warrants (the “Warrants”) within sixty days of January 11, 2021. The reporting persons expressly disclaim status as a group for purposes of this Schedule 13D.

(2) The ownership percentage is calculated based on an aggregate of 2,017,387,808 Common Shares, which the Issuer has informed the Reporting Persons was the total number of outstanding Common Shares immediately following the effectiveness of the Arrangement, and assuming exercise of all the Warrants referenced in footnote 1 above.

(1) Represents (a) 231,194,698 common shares, no par value per share (the “Common Shares”), of Cenovus Energy Inc. (the “Issuer”) held by L.F. Investments S.à r.l. and (b) 19,185,181 Common Shares that L.F. Investments S.à r.l. may purchase upon the exercise of warrants (the “Warrants”) within sixty days of January 11, 2021. The reporting persons expressly disclaim status as a group for purposes of this Schedule 13D.

(2) The ownership percentage is calculated based on an aggregate of 2,017,387,808 Common Shares, which the Issuer has informed the Reporting Persons was the total number of outstanding Common Shares immediately following the effectiveness of the Arrangement, and assuming exercise of all the Warrants referenced in footnote 1 above.

(1)   Represents (a) 231,194,698 common shares, no par value per share (the “Common Shares”), of Cenovus Energy Inc. (the “Issuer”) and (b) 19,185,181 Common Shares that L.F. Investments S.à r.l. may purchase upon the exercise of warrants (the “Warrants”) within sixty days of January 11, 2021. The reporting persons expressly disclaim status as a group for purposes of this Schedule 13D.

(2)   The ownership percentage is calculated based on an aggregate of 2,017,387,808 Common Shares, which the Issuer has informed the Reporting Persons was the total number of outstanding Common Shares immediately following the effectiveness of the Arrangement, and assuming exercise of all the Warrants referenced in footnote 1 above.

(1)   Represents (a) 231,194,698 common shares, no par value per share (the “Common Shares”), of Cenovus Energy Inc. (the “Issuer”) and (b) 19,185,181 Common Shares that L.F. Investments S.à r.l. may purchase upon the exercise of warrants (the “Warrants”) within sixty days of January 11, 2021. The reporting persons expressly disclaim status as a group for purposes of this Schedule 13D.

(2)   The ownership percentage is calculated based on an aggregate of 2,017,387,808 Common Shares, which the Issuer has informed the Reporting Persons was the total number of outstanding Common Shares immediately following the effectiveness of the Arrangement, and assuming exercise of all the Warrants referenced in footnote 1 above.

This Schedule 13D relates to the common shares, no par value per share (the “Common Shares”), of Cenovus Energy Inc., a corporation amalgamated under the laws of Canada (the “Issuer”). The Issuer’s principal executive offices are located at 4100, 225 – 6th Avenue S.W., Calgary, Alberta, Canada T2P 1N2.

(a). and (f). This Schedule 13D is being filed jointly by:

i.        L.F. Investments S.à r.l., a company incorporated in Luxembourg (“LFI”);

ii.       Kimstar Enterprises Limited, a company incorporated in Hong Kong (“Kimstar”);

iii.      Chinaton Investment Limited, a company incorporated in the British Virgin Islands (“Chinaton”);

iv.      Evago Investment Limited, a company incorporated in the British Virgin Islands (“Evago”);

v.       Li Ka-Shing Castle Trustee Corporation Limited, a company incorporated in the Cayman Islands (“Castle Trustee”); and

vi.      Mr. Li Ka-Shing, a citizen of Hong Kong.

The foregoing parties are collectively herein referred to as the “Reporting Persons” and each as a “Reporting Person.”

Kimstar and Chinaton own all of the outstanding share capital of LFI. Kimstar is wholly owned by Chinaton, which is wholly owned by Evago. Evago is wholly owned by Castle Trustee. Castle Trustee serves as the trustee of The Li Ka-Shing Castle Discretionary Trust, a discretionary trust established by Mr. Li Ka-Shing as settlor under the laws of the Cayman Islands of which members of Mr. Li Ka-Shing’s family are discretionary beneficiaries. The Reporting Persons hereby disclaim beneficial ownership of the securities referred to above, except to the extent the exercise of the Castle Trustee’s discretionary trust powers vests it with voting and/or dispositive control over such securities.

Set forth on Schedule A attached hereto and incorporated herein by reference is the principal business of each Reporting Person and the name and citizenship of each of the directors and executive officers of each Reporting Person.

(b).           Set forth on Schedule A attached hereto and incorporated herein by reference is the principal address of each Reporting Person and of the directors and executive officers of each Reporting Person.

(c).           Set forth on Schedule A attached hereto and incorporated herein by reference is the principal occupation or employment of each of the directors and executive officers of each Reporting Person as well as the principal business and address of the corporation or other organization in which such director or executive officer’s employment is conducted.

(d).           During the last five years, none of the Reporting Persons or, to the best knowledge of the Reporting Persons, any of the other persons named in this Item 2, has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).

(e).           During the last five years, none of the Reporting Persons or, to the best knowledge of the Reporting Persons, any of the other persons named in this Item 2, has been a party to any civil proceeding commenced before a judicial or administrative body of competent jurisdiction as a result of which it was or is now subject to a judgement, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities law or finding any violation with respect to such laws.

On January 1, 2021, the Issuer acquired all of the issued and outstanding common shares (the “Husky Common Shares”) of Husky Energy Inc. (“Husky”) pursuant to a court-approved Plan of Arrangement in accordance with the provisions of the Business Corporations Act (Alberta) (the “Arrangement”). As a result, a portion of the Husky Common Shares held by each common shareholder of Husky was exchanged for warrants (“Warrants”) and the remaining portion of the Husky Common Shares was exchanged for Common Shares, such that, in aggregate, each common shareholder of Husky received 0.7845 of a Common Share and 0.0651 of a Warrant in respect of each Husky Common Share held. Each whole Warrant entitles the holder thereof to acquire one Common Share upon payment in full of the exercise price of C$6.54 per Common Share at any time up to 60 months following completion of the Arrangement.

Upon the effectiveness of the Arrangement, LFI, as a holder of Husky Common Shares, automatically received the Common Shares and Warrants disclosed in this Schedule 13D in exchange for its Husky Common Shares. No other consideration was used by the Reporting Persons in connection with the acquisition of the Common Shares and Warrants described in this Schedule 13D.

The information set forth in or incorporated by reference in Items 3 and 6 of this Schedule 13D is incorporated by reference into this Item 4.

The Reporting Persons hold the Common Shares and Warrants as described in this Schedule 13D for investment purposes and intend to review their investment in the Issuer on a continuing basis. Subject to the terms of the Standstill Agreement (as defined below), depending on various factors, including but not limited to the Issuer’s business, prospects, financial position and strategic direction, price levels of the Common Shares and Warrants, conditions in the securities markets, and general economic and industry conditions, each Reporting Person may in the future take such actions with respect to its investment in the Issuer as it deems appropriate, including changing its current intentions, with respect to any or all matters required to be disclosed in this Schedule 13D.

Consistent with the Reporting Persons’ investment purposes, subject to the terms of the Standstill Agreement, the Reporting Persons may engage in communications with, without limitation, one or more shareholders of the Issuer, management of the Issuer or one or more members of the board of directors of the Issuer, and may make suggestions concerning the Issuer’s operations, prospects, business and financial strategies, strategic direction and transactions, assets and liabilities, business and financing alternatives and such other matters as the Reporting Persons may deem relevant to their ownership of the Common Shares and Warrants. The Reporting Persons expect that they will, from time to time, review their investment position in the Issuer and may, subject to the terms of the Standstill Agreement, make additional purchases of Common Shares (or other securities convertible or exercisable into Common Shares) in the open market or in privately negotiated transactions, or hold or dispose of all or part of their investments in the Common Shares, depending upon the Reporting Persons’ evaluation of the Issuer’s business, prospects, financial condition and strategic direction, the market for the Common Shares and Warrants, other opportunities available to the Reporting Persons, general economic conditions, stock market conditions and other factors.

Except as set forth in this Item 4 or Item 6 below, the Reporting Persons have no present plans or proposals that relate to or that would result in any of the actions specified in clauses (a) through (j) of Item 4 of Schedule 13D.

(a). and (b).       The information required by Items 5(a) and 5(b) is set forth in Rows 7-13 of the cover page for each of the Reporting Persons and is incorporated herein by reference.

To the knowledge of the Reporting Persons, among the directors and executive officers of each Reporting Person listed in Schedule A hereto:

•        Mr. Frank John Sixt owns 55,064 Common Shares and 4,569 Warrants of the Issuer;

•        Mr. Neil McGee owns 58,096 Common Shares and 4,820 Warrants of the Issuer; and

•        none of the other persons named in Item 2 beneficially owns any Common Shares or securities of the Issuer convertible into Common Shares within sixty days of January 11, 2021.

(c).           Except as described in this Schedule 13D, none of the Reporting Persons or, to the best knowledge of the Reporting Persons, any other person named in Item 2 has effected any transaction in the Common Shares during the past 60 days.

(d).           No other persons are known to have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, the Common Shares.

(e).           Not Applicable.

The information set forth in Items 3 and 5 is hereby incorporated by reference into this Item 6.

In connection with the Arrangement, LFI entered into a Support Agreement, Standstill Agreement, Pre-Emptive Rights Agreement and a Registration Rights Agreement with the Issuer, which are described below.

Support Agreement

On October 24, 2020, LFI entered into a support agreement (the “Support Agreement”) with the Issuer pursuant to which LFI agreed, among other things, to vote, or cause to be voted, all of the Husky Common Shares or any other securities of Husky having voting rights in respect of the Arrangement beneficially owned, controlled or directed or subsequently acquired by it: (a) for and in favor of the Arrangement; and (b) against any other business combination, arrangement, amalgamation, merger, consolidation, reorganization, recapitalization, liquidation, material asset sale or similar transaction involving Husky, or any issue of securities by Husky, or any resolution to approve, ratify or adopt any of the foregoing. The Support Agreement terminated as of January 1, 2021.

The foregoing description of the Support Agreement does not purport to be complete and is qualified in its entirety by reference to the Support Agreement, a copy of which is filed as Exhibit 7.2 hereto and is incorporated herein by reference.

Standstill Agreement

On October 24, 2020, LFI entered into a standstill agreement (the “Standstill Agreement”) with the Issuer, with effect as of January 1, 2021. The Standstill Agreement sets forth certain restrictions and obligations in connection with LFI’s shareholdings in the Issuer.

Transfer Restrictions

Subject to certain exceptions, for a period of 18 months following January 1, 2021, LFI may not transfer any Common Shares, except: (i) pursuant to a business combination involving the Issuer (a “Combination Transaction”) that has been approved or recommended by the board of directors of the Issuer or (ii) in regard to a transfer to an affiliate of LFI, provided that such affiliate agrees to be bound by and become a party to the Standstill Agreement.

Without the prior consent of the Issuer, LFI may not transfer, either alone or in the aggregate with its affiliates, Hutchison Whampoa Europe Investments S.à r.l. (“Hutchison Europe”) (which was a shareholder of Husky and received Common Shares and Warrants as a result of the Arrangement) or its affiliates any Common Shares or Warrants to any person, that would, to the knowledge of LFI, result in such person, together with any persons acting jointly or in concert with such person, beneficially owning, or controlling or directing, 20% or more of the then-outstanding Common Shares (including those Common Shares and Warrants proposed to be transferred), subject to certain exceptions.

Voting Restrictions

Pursuant to the Standstill Agreement, LFI has covenanted and agreed that it and its affiliates shall: (a) vote or cause to be voted all Common Shares that it beneficially owns, or over which it or any of its affiliates has control or direction, in favor of; or (b) abstain from voting in respect of all Common Shares that it beneficially owns, or over which it or any of its affiliates has control or direction, in respect of, the election, as directors of the Issuer, of all nominees of the Issuer’s board or management at any annual or other meeting of the Issuer’s common shareholders at which members of the Issuer’s board are proposed to be elected.

In connection with a Combination Transaction, LFI has covenanted and agreed that it shall, and shall cause its affiliates to, vote its pro-rata share of all Excess Shares (as defined below) that it beneficially owns, or over which it or any of its affiliates has control or direction, in accordance with the recommendation of the Issuer’s board in respect to such Combination Transaction. “Excess Shares” means, at the applicable time, such number of Common Shares held by LFI and Hutchison Europe, in aggregate, which are in excess of the number that is 19.9% of the then-outstanding Common Shares.

Prohibited Activities

Subject to certain exceptions, without the prior written consent of the Issuer, LFI has agreed that neither it nor its affiliates, will, directly or indirectly, take certain actions, including the following:

These restrictions shall cease to apply on the earlier of: (i) the execution and delivery by the Issuer of a definitive agreement to implement a transaction or series of transactions pursuant to which a person agrees to acquire beneficial ownership of, or control or direction over, more than 50% of the outstanding voting securities of the Issuer (measured on a fully-diluted basis) or a majority of the consolidated assets of the Issuer and its subsidiaries; (ii) a person or group of related persons acting jointly or in concert acquire beneficial ownership of, or control or direction over, at least 20% of the outstanding voting securities of the Issuer; and (iii) a person or group of related persons acting jointly or in concert publicly commence a formal take-over bid for more than 20% of the outstanding voting securities of the Issuer.

Termination

The Standstill Agreement shall terminate on the date that is 60 months following January 1, 2021, unless any of the following events occur which cause earlier termination:

(a)       the date on which the Standstill Agreement or the standstill agreement entered into by LFI and the Issuer is terminated by the written agreement of the parties thereto;

(b)       provided that the restrictions set out above under the heading “Transfer Restrictions” have been complied with under the Standstill Agreement and under the other standstill agreement with Hutchison Europe, the date on which LFI and Hutchison Europe, together with their affiliates, cease to beneficially own, or control or direct, in aggregate, at least 10% of the then-outstanding Common Shares; or

(d)       any “Qualified Individual” (as defined in the Standstill Agreement) duly nominated in accordance with the Standstill Agreement is not appointed to the Issuer’s board of directors in accordance with the Standstill Agreement.

The foregoing description of the Standstill Agreement does not purport to be complete and is qualified in its entirety by reference to the Standstill Agreement, a copy of which is filed as Exhibit 7.3 hereto and is incorporated herein by reference.

Pre-Emptive Rights Agreement

On January 1, 2021, LFI and the Issuer entered into a pre-emptive rights agreement (the “Pre-Emptive Rights Agreement”) pursuant to which LFI is entitled to, upon the proposed issuance or sale by the Issuer of Common Shares or other convertible securities of the Issuer, purchase such number of additional Common Shares or other convertible securities of the Issuer on the same terms and conditions that such securities are being issued or sold by the Issuer, including at the same price per security and otherwise be on economic terms and conditions no less favorable, individually or in the aggregate, to LFI than the terms and conditions are to any purchaser in such offering, in order to allow LFI to maintain its pro rata share of the then-outstanding Common Shares that it holds at the applicable time. These rights cease on the earlier of the date which is 60 months following January 1, 2021, the date LFI ceases to, directly or indirectly, beneficially own in aggregate more than 5% of the then-outstanding Common Shares, the date on which the Pre-Emptive Rights Agreement is terminated by agreement of the parties, or the date on which the Standstill Agreement is terminated.

The foregoing description of the Pre-Emptive Rights Agreement does not purport to be complete and is qualified in its entirety by reference to the Pre-Emptive Rights Agreement, a copy of which is filed as Exhibit 7.4 hereto and is incorporated herein by reference.

Registration Rights Agreement

On January 1, 2021, LFI and the Issuer entered into a registration rights agreement (the “Registration Rights Agreement”) pursuant to which LFI is provided with certain demand and piggy-back registration rights, requiring the Issuer to qualify the distribution of certain registrable securities of the Issuer upon the request of LFI. These rights cease on the earlier of the date which is 60 months following January 1, 2021, the date LFI ceases to, directly or indirectly, beneficially own in aggregate more than 5% of the then-outstanding Common Shares, the date on which the Registration Rights Agreement is terminated by agreement of the parties, or the date on which the Standstill Agreement is terminated.

The foregoing description of the Registration Rights Agreement does not purport to be complete and is qualified in its entirety by reference to the Registration Rights Agreement, a copy of which is filed as Exhibit 7.5 hereto and is incorporated herein by reference.

(a). Exhibit 7.1 - Joint Filing Agreement dated January 11, 2021 by and among the Reporting Persons

(b). Exhibit 7.2 - Form of Support Agreement (incorporated by reference to Schedule G to Appendix D of Exhibit 99.1 to the current report on Form 6-K of the Issuer furnished on November 16, 2020)

(c). Exhibit 7.3 - Form of Standstill Agreement (incorporated by reference to Schedule H to Appendix D of Exhibit 99.1 to the current report on Form 6-K of the Issuer furnished to the Securities and Exchange Commission (“SEC”) on November 16, 2020)  

(d). Exhibit 7.4 - Pre-Emptive Rights Agreement dated January 1, 2021 by and between Cenovus Energy Inc. and L.F. Investments S.à r.l. (incorporated by reference to Exhibit 99.4 to the current report on Form 6-K of the Issuer furnished to the SEC on January 4, 2021)

(e). Exhibit 7.5 - Registration Rights Agreement dated January 1, 2021 by and between Cenovus Energy Inc. and L.F. Investments S.à r.l. (incorporated by reference to Exhibit 99.6 to the current report on Form 6-K of the Issuer furnished to the SEC on January 4, 2021)

(f). Exhibit 7.6 – Warrant Indenture dated January 1, 2021 by and between Cenovus Energy Inc. and Computershare Trust Company of Canada (incorporated by reference to Exhibit 99.1 to the current report on Form 6-K of the Issuer furnished to the SEC on January 4, 2021)

SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

Date: January 11, 2021

Schedule A

L.F. Investments S.à r.l.

The directors of each of Kimstar Enterprises Limited⁽³⁾, Chinaton Investment Limited⁽⁴⁾, Evago Investment Limited⁽⁵⁾ and Li Ka-Shing Castle Trustee Corporation Limited⁽⁶⁾ are as follows:

Notes to Schedule A:

(1)         Unless otherwise indicated, the business address of each of the named persons is 7th Floor, Cheung Kong Center, 2 Queen’s Road Central, Hong Kong.

(2)         The principal address of L.F. Investments S.à r.l. is 9-11 Grand Rue, L-1661 Luxembourg, Grand Duchy of Luxembourg.  The business of L.F. Investments S.à r.l. is investment holding.

(3)          The principal address of Kimstar Enterprises Limited is 7th Floor, Cheung Kong Center, 2 Queen’s Road Central, Hong Kong.  The business of Kimstar Enterprises Limited is investment holding.

(4)          The principal address of Chinaton Investment Limited is Morgan & Morgan Building, Pasea Estate, Road Town, British Virgin Islands. The business of Chinaton Investment Limited is investment holding.

(5)         The principal address of Evago Investment Limited is Morgan & Morgan Building, Pasea Estate, Road Town, British Virgin Islands. The business of Evago Investment Limited is investment holding.