Red Eagle Mining (TSX:R), a Vancouver, British Columbia-based gold exploration and development corporation with a mine-development team, was placed in receivership on November 21 on application by Orion Fund JV, in its capacity as collateral agent, and Liberty Metals & Mining Holdings, owed approximately $60.0MM (USD). The corporation had been focusing on building shareholder value through discovering and developing gold projects with low costs and low technical risks in Colombia. FTI Consulting was appointed receiver. Counsel is Lawson Lundell for Orion Fund JV and Miller Thomson for the receiver.
Alum-Tek Industries, an Aldergrove, British Columbia-based manufacturer of enclosures, containers and subbase fuel tanks for power generation filed an NOI on October 19. The company attributed its financial difficulties to delays on certain projects and rising steel prices, resulting in unrecoverable costs and losses for the company. PwC is the proposal Trustee.
Harvest Fraser Richmond Organics, an indirect subsidiary of Harvest Power, a Massachusetts-based company that specializes in converting food and yard waste into biofuel, compost and fertilizer, filed for protection under the CCAA on October 12, listing approximately $23.6MM in liabilities, including $16.3MM to Harvest Canada and $5.1MM to Harvest Power. The company owns and operates a manufacturing facility in Richmond, British Columbia for processing organic waste ("Compost Facility"), as well as an electricity-producing anaerobic digestion facility ("Energy Garden"). Pursuant to agreements with various cities in the lower mainland, the company accepted organic and food waste materials from these cities for processing at its facility. In September 2016, Metro Vancouver issued an air quality management permit to the company containing requirements such as reducing the height of compost piles and replacing its composting system. Despite operating under this permit, the Compost Facility has been affected by odour complaints from neighbouring residents since 2016 and has been the subject of reporting by Vancouver media outlets. In response to these complaints, the Energy Garden eventually ceased operation in April 2017. This shut down resulted in the company being unable to meet its energy delivery obligations to the British Columbia Hydro and Power Authority ("BC Hydro") under its agreement to sell BC Hydro certain quantities of renewable energy generated by the Energy Garden. BC Hydro advised that it would bill the company $12.5M in respect of the energy delivery shortfalls to date. The company cites further reasons for its financial difficulties, including, among other things, the fact that the company had to shut down one of its composting systems under the permit, which reduced the company's revenue. In addition, as of February 2018, Metro Vancouver has diverted certain of its waste to alternate service providers for processing. During these CCAA proceedings, Maynbridge Capital will be providing up to $1.0MM in DIP financing. EY was appointed monitor. Bennett Jones is counsel to the company.
Purewal Blueberry Farms, one of North America's largest blueberry farms, located in Pitts Meadow, British Columbia, filed for protection under the CCAA on October 11, listing approximately $17.8MM in liabilities, including $4.8MM to the Receiver General for Canada and $1.1MM to Netpak Paper & Packaging. The company already filed an NOI on April 30 but needs additional time to complete a sale process. Along with the initial CCAA order, the court granted an order approving a stalking horse agreement of purchase and sale. FTI Consulting was discharged as proposal trustee and appointed monitor under the CCAA proceedings. Counsel is Clark Wilson for the company and Cassels Brock for the monitor.
Basin Mine Limited Partnership, a limited partnership ultimately owned by Arthon Industries, filed an NOI on October 3. In 2015, the partnership acquired, through the CCAA proceedings of Coalmont Energy Corp, the mining permit to develop and operate an open pit coal mine near Coalmont, British Columbia. The mine was anticipated to produce approximately 500.0M tonnes of thermal coal per year. Full scale production has never taken place though, due primarily to the price of thermal coal dropping well below the break-even point for the mine. The mine currently does not generate any revenue and incurs costs of approximately $60.0M per month to keep it under care and maintenance. In early 2016, Callidus Capital, the partnership's senior secured lender owed approximately $63.3MM, advised that it wanted the partnership to sell its assets, primarily to stop the mine's ongoing care and maintenance costs, which it funded. The partnership, with the assistance of Ritchie Bros and MNP Corporate Finance, commenced a sales process that ultimately produced one offer from Pioneer Sand and Gravel (Pioneer). In order to convey the assets to Pioneer free and clear of encumbrances and charges, the transaction will be completed under a formal insolvency process. EY is the proposal trustee. Counsel is Cassels Brock for the company and BLG for Callidus.
PE Consulting, a Richmond, British Columbia-based company whose primary asset is land having the civic address 2791 Highview Place West Vancouver, British Columbia, was placed in receivership on June 8 on application by G. Powroznik Group, in its capacity as trustee of the bankrupt estate of Jizhe (Mary) Yang, the sole director and shareholder of PE Consulting. In November 2015, Yang and her husband, Samuel Zhu, were together found liable for over $20.0MM USD for fraud conducted against Zhu's former employer, Prima Technology (details HERE). G. Powroznik Group was appointed receiver. Counsel is Burns Fitzpatrick for the applicant.
Purcell Basin Minerals, Bul River Mineral Corporation, Gallowai Metal Mining, Grand Mineral Corporation and Stanfield Mining Group, Cranbrook, British Columbia-based developers of mineral resources and a mining property near the Rocky Mountains, filed for protection under the CCAA on May 29. Purcell had acquired the mine and the other petitioners in 2014 by way of a court-sanctioned plan of arrangement in the Stanfield CCAA proceedings. A year later, Brendan MacMillan, who was the sole director and officer of Purcell at that time, took some steps to further the development of the mine. However, he also caused the company to, among other things, secure his claimed compensation and issue three million shares to him. In 2016, two of Purcell's shareholders successfully challenged these transactions as being oppressive. Since the implementation of the Stanfield plan of arrangement, Purcell's business has been hampered by the oppressive actions of MacMillan and by litigation involving Purcell, its lenders and its shareholders. The company currently has no cash on hand, no income and no inflow of equity capital. The company will use the CCAA proceedings to, among other things, conduct a claims process to determine the validity and status of all creditors' claims, restructure its secured debt and seek new capital. MNP was appointed monitor. Counsel is Gowling WLG for the companies and Lawson Lundell for the monitor.
Wavefront Innovation Society, a Vancouver, British Columbia-based startup accelerator focused on mobile and IoT (Internet of Things) innovation, filed for bankruptcy on May 14, listing $2.1MM in liabilities, including $958.5M to the National Research Council of Canada and its Centres of Excellence for Commercialization and Research. While the company once presented itself as a key player in facilitating the creation of technological "smart cities", declining sources of revenue have contributed to its financial downturn. Grant Thornton is the bankruptcy trustee.
VI Fitness Centres Inc., a British Columbia-based fitness chain with eight locations on Vancouver Island, filed for bankruptcy on May 1, listing $5.7MM in liabilities. The company went through financial difficulties due to increased competition and could no longer sustain the operating loss. The Bowra Group Inc. is the Licensed Insolvency Trustee.
Control Mobile, a Vancouver, British Columbia-based technology company, was placed in receivership on April 12 on application by the McDonnell Group, owed approximately $508.6M. Founded in 2014 and backed by Vanedge Capital and BDC Capital, the company provides an analytics platform for online businesses to manage and analyze their online transaction data and quickly grew to over 25.0M customers. Despite its growth, the company recently ran into cash flow difficulties. In January 2018, the company accepted a secured promissory note from the McDonnell Group, but defaulted on the note soon after. Crowe MacKay was appointed receiver. Counsel is Fasken for the applicant and Farris for the company.