Mahal Venture Capital Inc. ("Mahal") and Golden Miles Food Corporation ("Golden Miles"), Brantford, Ontario-based companies, had a receiver appointed over their assets owned or used in connection with a flour mill located on 155 Adams Blvd., Brantford, Ontario (the “Real Property”). The application was brought by Skymark Finance Corporation, owed approximately $29 million. Mahal is the registered owner of the Real Property and, once completed, Golden Miles was to operate the flour mill located at the Real Property. KSV was appointed receiver. Counsel is Chaitons for Skymark Finance Corporation, Kirwin Partners for the companies and Blakes for the receiver.
McEwan Enterprises Inc., a Toronto, Ontario-based premier hospitality company, obtained protection under the CCAA on September 28, listing over $10 million in liabilities. The company's business is comprised of six high-end restaurant locations (including Bymark, Fabbrica and ONE Restaurant), three gourmet grocery locations, a catering business and an events business, A key part of the company's restructuring plan and the CCAA proceedings is to effectuate a going concern transaction of the company's business, including the sale and transfer of substantially all of its assets and liabilities, to a new entity formed by the company's current shareholders, Fairfax Financial Holdings Limited and McEwan Holdco Inc. A&M was appointed monitor. Counsel is Goodmans for the company and Bennett Jones for the monitor.
Ryding Regency Meat Packers, a Toronto, Ontario-based meat processing company, filed for bankruptcy on June 15, listing approximately $5.2 million in assets and $10.4 million in liabilities, including $7.4 million to Tri-Pet Holdings Incorporated. In 2019, the company closed after the Canadian Food Inspection Agency ("CFIA") revoked its processing licence due to ongoing food safety concerns. On June 10, 2021, the CFIA laid charges against the company for various alleged offences of the Safe Food for Canadians Act and the Food and Drugs Act. Schwartz Levitsky Feldman is the bankruptcy trustee.
Solis Foods Corporation Inc. ("Solis"), Vivian Group Inc. ("Vivian Group") and 1610830 Alberta Ltd. ("161Co"), three related companies, filed an NOI on June 8, listing approximately $19.0 million in secured debt and $5.1 million in unsecured trade debt. Together, the companies facilitate a business enterprise in which Solis manufactures and packages snack foods for the food service and retail grocery industries, including producing national branded and private-label snack foods. Vivian Group is a holding company responsible for real estate and 161Co is a holding company solely responsible for certain Alberta real estate (and equipment) that was the home of a now-closed production facility. After Solis ran into liquidity issues in 2018, David Andrew Vivian ("Andrew") sold 50% of his interest in Vivian Group to Super Pufft Snacks Corp. ("Snacks"). In addition to providing working capital to the companies, Snacks would provide production expertise to help improve Solis' profitability. However, profitability did not improve in 2019 as certain key customers were lost and Solis reported $1.2 million in losses. With the onset of COVID-19 related shutdowns in 2020, the companies' financial situation further deteriorated as many restaurants and food services business closed. In light of the financial challenges facing the business, Snacks determined it is no longer prepared to fund the companies' working capital needs. Sun Pac Holdings Ltd. will be providing interim financing during these proceedings. EY is the proposal trustee. Counsel is Loopstra Nixon for the companies, DLA Piper for the proposal trustee, Aird & Berlis for Sun Pac Holdings Ltd. and Snacks, and GSNH and Hager Law for Andrew.
Okje Cho & Family Enterprise Ltd. (“Okje”) and 2341567 Ontario Ltd. (“234 Ontario”) were placed in receivership on May 25 on application by Meridian Credit Union Limited (“Meridian”), owed approximately $7.77 million. 234 Ontario operates as a Hampton Inn by Hilton hotel franchise in Napanee, Ontario, and Okje owns the property from which the hotel operates. Due to the COVID-19 pandemic, Okje requested payment relief from its obligations in spring 2020. Meridian agreed, deferring principal and interest payments for a consensual period of time. Okje subsequently failed to make suitable repayment arrangements with Meridian and has not made payments under certain credit facilities since December 2020 and January 2021, as well as failing to repay a third credit facility by its maturity date in October 2020. In addition, royalties to the franchisor, Hilton Hotels, accruing municipal property taxes and harmonized sales tax have gone unpaid for a period of time, threatening operations. BDO Canada was appointed receiver. Counsel is Lipman, Zener & Waxman for Meridian and Loopstra Nixon for the receiver.
DH Group Inc., which was operating as a Montana's BBQ and Bar in St. John, NL, was adjudged bankrupt on April 30 upon the application of Recipe Unlimited Corporation, owed approximately $257.8 thousand. The company also owes approximately $869.7 thousand to CIBC and $154.3 thousand to CRA. Deloitte is the bankruptcy trustee. Cox & Palmer is counsel to the applicant.
WA Grain & Pulse Solutions, an Innisfail, Alberta-based company in the business of grain processing for human and pet food consumption, with facilities in Alberta, Saskatchewan, and PEI, was placed in receivership on April 26 on application by ATB Financial (the "Lender"). The company lists a total of $24.6 million in liabilities, including $11.9 million to the Lender, $8 million to Avrio Subordinated Debt Limited Partnership II ("Avrio"), and $4.7 million to Farm Credit Canada. Pursuant to a commitment letter, the Lender made several loans to the company, including an operating loan facility of up to $10 million (the "Loans"). In 2018, the Lender's turnaround and restructuring group ("TRG") began monitoring the Loans due to the company's poor financial performance and history of requiring financial covenant waivers. Despite several attempts by the company to improve its financial performance, TRG has had to continually monitor the Loans. In April, the company experienced several further setbacks: first, police were called to the company to investigate a theft of more than $200 thousand worth of equipment; second, the Canadian Grain Commission suspended the company's license after the company was unable to pay $6.5 million for unpaid inventory before April 23. Without this license, the company cannot operate its grain business. BDO was appointed receiver. Counsel is MHR Law for the company, Fasken for the Lender, MLT Aikins for the receiver, and McCarthy Tétrault for Avrio.
Tetu Island Lodge, which is the registered owner and operator of a seasonal hunting and fishing lodge on Tetu Lake, Ontario (the "Property"), was placed in receivership on April 21 on application by BDC, owed approximately $534.6 thousand. Since the majority of guests who attend the lodge are from the US, there has been minimal income in the last year as a result of the continuing border closure between Canada and the US. The owners of the lodge are also American and the travel restrictions have not allowed them to attend the lodge to operate the facility. BDC claims that the company has not made any of the required payments under their loan agreement and that the company refuses to provide any financial information or disclosure to the BDC. Currently, it appears that the company has ceased operating and has since abandoned the Property. However, because the Property is inaccessible by road, BDC has been unable to confirm whether there is a risk to the company's equipment and buildings located on the Property, which are the assets over which BDC has security. MNP was appointed receiver. Soloway Wright is counsel to the applicant.
Fireweed Brewing Corp., a Kelowna, British Columbia-based privately-owned craft brewer with brands such as Tree Brewing, Dukes Cider, and Shaftebury, filed for bankruptcy on April 14, listing approximately $6.4 million in liabilities, including $3.4 million to Raw Energy Ltd. and $1.9 million to BMO. Deloitte is the bankruptcy trustee.
Knotel Canada, Inc. had its US Chapter 11 proceedings recognized under the CCAA on March 12. Founded in 2015 and based in New York City, the company's parent and subsidiaries (collectively, the "Knotel Group") are a market leader in the dedicated flexible workspace industry. In Canada, the company has entered into leases for office space in the Financial District in Toronto to provide workspace arrangements in a dedicated, non-shared environment. Despite significant growth in 2019, the Knotel Group experienced significant disruption over the past year as a result of the COVID-19 pandemic, which adversely affected the Knotel Group's cash flow and ability to raise new capital. Throughout 2020, the Knotel Group took various actions to improve sales, reduce costs, and raise new capital. However, the pandemic’s duration and severe impact on the Knotel Group's liquidity proved to be overwhelming. In January, the company's parent and more than 200 US subsidiaries filed voluntary petitions for relief under the US Bankruptcy Code to facilitate a going concern sale of the Knotel Group's core business. Recognition of the Chapter 11 cases will avoid multiple main proceedings in different jurisdictions and give the Knotel Group the opportunity to complete a comprehensive sale of its business. Alvarez & Marsal was appointed information officer. Counsel is Cassels for the Canadian filing entities and Blakes for the information officer.