Our summaries of recent Canadian insolvency filings.

Filing Type:

Trustee: Goldhar & Associates

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2051095 Ontario Inc. o/a Pizza Workz, which formerly operated as a pizza store in Carp, Ontario, filed an assignment in bankruptcy on April 29. There was a dispute amongst the shareholders as to the operations and management of the business regarding receipts and payments. On examination by the majority shareholder, it was ascertained that the company’s indebtedness far exceeded its repaying capacity. As there was no visibility towards the revival of business, the company filed an assignment in bankruptcy. Goldhar & Associates is the bankruptcy trustee.

By Dina Milivojevic

Filing Type:

Company Counsel: Solmon Rothbart Tourgis Slodovnick

Trustee: KSV

Applicant: Kingsett Mortgage Corporation

Applicant Counsel: Goodmans

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30 Roe Investments Corp., the owner of a condominium located at 30 Roehampton Avenue in Toronto, Ontario, was placed in receivership on May 9 on application by Kingsett Mortgage Corporation, owed approximately $1.9 million as at January 2022. The original maturity date of the loan was in April 2021. Since that time, Kingsett has agreed to three extensions to allow the company to, among other things, pursue refinancing. These efforts have not been successful. KSV was appointed receiver. The company has appealed the receivership order. Counsel is Goodmans for the receiver, Bennett Jones for Kingsett and Solmon Rothbart Tourgis Slodovnick for the company.

By Dina Milivojevic

2513036 Ontario Ltd.

May 5, 2022

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Trustee: BDO

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2513036 Ontario Ltd., which operated as a Sport Clips franchise from a leased location in Ajax, Ontario, was deemed bankrupt on May 5, listing approximately $204,000 in liabilities. The Company previously filed an NOI on April 25, but failed to file the projected cash flows within the 10-day period and was deemed bankrupt. BDO is the bankruptcy trustee and previously acted as the proposal trustee.

By Dina Milivojevic

Filing Type:

Company Counsel: Perley-Robertson, Hill & McDougall

Trustee: KSV

Trustee Counsel: Aird & Berlis

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Clearford Water Systems Inc. (TSXV:CLI), an Ottawa, Ontario-based provider of unified water management solutions for the design, deployment, finance and operation of water infrastructure systems, filed an NOI on April 28. KSV is the proposal trustee. Perley-Robertson, Hill & McDougall for the company; DLA Piper for Morebath/Lexus (a secured creditor); and Aird & Berlis for the proposal trustee.

By Dina Milivojevic

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Mooney’s Bay (Ottawa) Seniors Community Real Estate Limited Partnership, a partnership formed to acquire and develop land in the City of Ottawa, filed an NOI on April 28, listing approximately $27.3 million in liabilities, including approximately $15.2 million to Fiera FP Real Estate Financing Fund. The project has been approved to be developed as an active seniors living project, including a 6-floor seniors apartment and retirement residence, along with 26 town homes, 36 flats and 62 mixed use units, on a 10.6 acre site across from Mooney’s Bay in central Ottawa. The project was delayed as a result of the COVID-19 pandemic, and increasing interest costs since 2020 have caused the partnership to consider options for further capital investment, or to commence a formal sales process to divest itself of the project. The partnership is currently soliciting offers to list and market the site. MNP is the proposal trustee.

By Dina Milivojevic

Filing Type:

Trustee: Goldhar & Associates

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12413906 Canada Inc. o/a AJ Concept Auto Modifications, a Thornhill, Ontario based automotive parts and accessory modification workshop, filed an assignment in bankruptcy on April 27, listing approximately $340,000 in liabilities. The business volume during the COVID-19 pandemic was much lower than the anticipated level and there were negligible clients during the extended period of restrictions. The company continued to incur fixed costs and, with no visibility towards the revival of business, it filed an assignment in bankruptcy. Goldhar & Associates is the bankruptcy trustee.

By Dina Milivojevic

Filing Type:

Trustee: EY

Trustee Counsel: DLA Piper

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Choom Holdings Inc. ("Holdings"), Choom BC Retail Holdings Inc., Phivida Holdings Inc., 2151414 Alberta Ltd. and 2688412 Ontario Inc. (collectively, "Choom"), a group of Vancouver, British Columbia-based cannabis companies, obtained protection under the CCAA on April 22. Holdings is the overall corporate parent of the group. It is a public entity listed on the Canadian Securities Exchange under the ticker symbol “CHOO”. As of the CCAA filing date, Choom operated 17 retail locations in Canada - two in British Columbia, twelve in Alberta and three in Ontario. Cannabis retail operations in Canada have endured a challenging business climate as a result of the industry being in its infancy and there being an oversaturation of cannabis retail operations in certain markets, particularly Alberta. Additionally, Choom has been negatively affected by the impacts of the COVID-19 pandemic. Retail store closures, physical distancing requirements and lower retail “foot traffic” resulted in lower sales than otherwise anticipated. EY was appointed monitor. Counsel is Dentons for Choom; DLA Piper for the monitor; McCarthy Tétrault for Aurora Cannabis; Fric, Lowenstein & Co. for a creditor; and Clark Wilson for the board of directors of Choom.

By Dina Milivojevic

Tazarmc Inc.

April 20, 2022

Filing Type:

Company Counsel: Dickinson Wright

Trustee: KPMG

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Tazarmc Inc., a Trenton, Ontario-based steel fabricator and service provider to multi-disciplined industrial and commercial construction projects throughout Canada and the United States, filed an NOI on April 20, listing approximately $4 million in liabilities, including approximately $1.3 million to Vulcraft Canada. KPMG is the proposal trustee. Counsel is Dickinson Wright for the company and KRB Law for National Bank.

By Dina Milivojevic

Filing Type:

Company Counsel: Miller Thomson

Trustee: Grant Thornton

Trustee Counsel: TGF

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Hazelton Development Corporation, a developer of a residential real estate project known as the “Highlight of Mississauga” located at 4064, 4070 and 4078 Dixie Road, Mississauga, Ontario, obtained CCAA protection on April 20. The majority of the 265 planned units in the project have been sold, although construction is at the stage that twelve of the fourteen floors have been constructed, though not finished. Construction was significantly delayed due to pandemic-related shutdowns, labour and supply shortages, and increasing costs. Construction lenders are Meridian Credit Union Limited and Centurion Mortgage Capital Corporation, with Westmount Guarantee Services Inc. providing a Tarion Warranty Corporation Bond and a deposit insurance facility. Total debts are in excess of $80 million. Counsel is Miller Thomson for the company; TGF for the monitor; Simpson Wigle for Meridian; Robbins Appleby for Centurion; BLG for Westmount; and Hodder, Wang for Triumph Eastern Investments (the DIP lender).

By Dina Milivojevic

Chisel AI

April 19, 2022

Filing Type:

Trustee: MNP

Trustee Counsel: Loopstra Nixon

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Chisel AI, a Toronto, Ontario-based technology company developing a commercial insurance workflow management platform, filed an assignment in bankruptcy on April 19. The company was seeking investment financing to strategically grow its business and had identified investors and signed a term sheet. However, the lead investor experienced several delays in closing its round. In order to mitigate its risk, the company engaged in conversations with several potential strategic acquirors. After exploring these possibilities and with no confirmation of its ability to close on the financing and no definitive offers for acquisition, Chisel decided to cease operations to conserve cash. MNP is the bankruptcy trustee. Loopstra Nixon is counsel for the bankruptcy trustee.

By Dina Milivojevic