Intelligent Engineering (Canada) Limited, an Ottawa, Ontario-based technology company that sold a proprietary structural composite material used extensively in civil, maritime and offshore construction projects, filed for bankruptcy on April 4, listing $4.3MM in liabilities, including $3.9MM to its UK-based parent company. MNP is the bankruptcy trustee.
Stantive Technologies Group, a Kingston, Ontario-based enterprise software provider focused on the development and deployment of its proprietary content management platform, OrchestraCMS, filed for protection under the CCAA on February 25. The company previously filed an NOI on November 14, listing $19.1MM in liabilities. EY was appointed monitor. TGF is counsel to the company.
Lanla, a Montreal, Quebec-based marketing research company, and Wizper, a digital advice management mobile app driven by customer experience-focused AI technology that is backed by Lanla's 15 years of customer experience expertise, filed NOIs on February 1. EY is the proposal trustee.
VersAccounts, an Ottawa, Ontario-based technology company that provides a cloud-based enterprise resource planning system, filed an NOI on January 22, listing $1.2MM in liabilities. The company's customers are typically fast growing companies looking to upgrade from entry-level accounting software; they pay an average yearly fee of $10.0M (USD) to use the company's software. Over the past two years, the company's financial performance steadily declined as it failed to meet sales projections and some existing customers chose not to renew their agreements with the company. Due to the company's poor performance, it was unable to secure further funding, including additional equity investment. The principal purpose of the NOI proceeding is to create a stabilized environment to allow the company to run a sale process for the company's assets. With the assistance of the proposal trustee, the company has negotiated the terms of an asset purchase agreement with Seattle Atlantic pursuant to which it will act as the stalking horse bidder in the sale process. Farber is the proposal trustee. Counsel is DLA Piper for the company, Dentons for the proposal trustee and Osler for Seattle Atlantic.
Klokwerks, a Toronto, Ontario-based company that produces technology-based sales programs, interactive marketing mobile apps, virtual reality, 3D photo-realistic renderings and film production for the real estate, automatic and retail sectors, filed an NOI on December 4, listing $855.0M in liabilities, including $636.6M to CRA. Dodick Landau is the proposal trustee.
Stantive Technologies Group, a Kingston, Ontario-based enterprise software provider focused on the development and deployment of its proprietary content management platform, OrchestraCMS, filed an NOI on November 14, listing $19.1MM in liabilities, including $1.4MM to Runway Finance Group and $1.9MM to Mamta Trust. The company relies on recurring revenue generated by subscription renewals through its main host platform, Salesforce.com. Salesforce, an American corporation based in San Francisco, is the company's most important relationship: OrchestraCMS is built entirely on Salesforce's platform. Although the company owns all of the intellectual property related to OrchestraCMS, the platform is not operable outside of the Salesforce ecosystem. In exchange for the use of the Salesforce platform, the company remits an amount equal to 12.5% of its recurring revenue. Currently, the company is in default of their agreement and owes Salesforce approximately $259.2M (USD). The company has been facing liquidity issues as a result of its debt structure and, for the past several months, has been working with EY, the proposal trustee, to try to address these issues. During these NOI proceedings, two numbered companies have agreed to provide up to $800.0M in DIP financing. PwC was engaged as financial advisor to the proposed DIP lenders. Counsel is TGF for the company and BTZ for the DIP lenders / certain secured creditors.
Intelligent Mechatronic Systems ("IMS") and Ridetones, Waterloo, Ontario-based technology companies in the business of developing and delivering advanced end-to-end mobile in-car solutions aimed at enhancing driver behaviour, were placed in receivership on September 14 on application by B.E.S.T Active 365 Fund LP et al., owed approximately $16.4MM by IMS and $12.1MM by Ridetones. The companies, which have been in default since March 2017, remain in default at present. Since these defaults arose, the companies have engaged in company-led efforts to refinance their indebtedness and/or sell its shares or assets. All refinancing and sales efforts have failed, however, to lead to any transaction which would have allowed the companies to repay their indebtedness. In early May 2018, in response to their financial difficulties, the companies' engaged Iberis Advisors, an outside investment bank, to administer a sale and investor solicitation process. This effort, too, proved unsuccessful. The companies are currently facing urgent and pressing liquidity issues, and their lenders are no longer willing to support them. PwC was appointed receiver. Counsel is Bennett Jones for the applicants, Norton Rose Fulbright for the companies and BLG for the receiver.
CrowdSpark Technology, a Toronto, Ontario-based subsidiary of the Australian technology and media company that engages in web-based and mobile software to help businesses gather and publish user-generated content, filed for bankruptcy on July 18. The company was founded by Alex Hartman in 2012, with its core technology developed by a French national news wire to deal with the volume of user-generated content it received during the Arab Spring in 2011. The company eventually went on to raise over $37.0MM from investors. Hartman, who rose to prominence as Australia's youngest tech entrepreneur in 1996, was deposed from the board in 2016 after Seven West Media took an 18.7% stake in the business. EY is the bankruptcy trustee.
Brican Automated Systems, a Brampton, Ontario-based company that develops custom robotic systems and factory automation, was assigned into bankruptcy on July 16 with a secured debt of $750.0M and an unsecured debt of $1.7MM. Grant Thornton is the bankruptcy trustee.
TELoIP, a Mississauga, Ontario-based technology company that principally develops and sells products that simplify cloud access through software-defined networks, filed for protection under the CCAA on June 27, listing approximately $36.6MM in liabilities. The company has been significantly impacted by the direction of telecommunications developments in the industry and its competitors' technologic advances. As a result, the company has been unable to achieve profitability and has relied on a succession of debt and capital financings to fund its operating losses while it continues to work towards the profitable commercialization of its technology. These financial difficulties placed the company at a competitive disadvantage and meant it has effectively been operating under increasing financial distress for many years. Accordingly, the company is now facing a liquidity crises and cannot meet obligations as they become due. Under the protection of the CCAA, the company is planning a restructuring and refinancing transaction that will see $36.4MM of secured debentures converted to equity or extinguished. Adarsan Holdings Limited and Dicot Holdings Ltd. are providing $1.5MM in DIP financing to ensure that the company has sufficient funds during the CCAA proceedings to effect the recapitalization. PwC was appointed monitor. Counsel is TGF for the company, and Goldman Sloan Nash & Haber for the monitor.