YG Limited Partnership and YSL Residences Inc., which are part of the Cresford Group of Companies ("Cresford") and are the owner/developer of the condominium project known as Yonge Street Living Residences (the "YSL Project"), at the intersection of Yonge Street and Gerrard Street in Toronto, filed NOIs on April 30. YG Limited Partnership lists approximately $64.1 million in liabilities, including $111.8 million to Westmount Guarantee, and YSL Residences Inc. owes approximately $106.8 million to Timbercreek Mortgage Servicing Inc. The YSL Project, which is currently subject to three mortgages totalling $249 million, has been suspended for more than a year due to ongoing financial difficulties of the companies and Cresford. If the NOI proposal is implemented, Concord Properties Development Corp. or its affiliate would become the owner/developer of the YSL Project. KSV Advisory is the proposal trustee. Counsel is Aird & Berlis for the companies, Davies for the proposal trustee, and Bennett Jones for the Concord Properties Development Corp.
Bridging Finance Inc. ("BFI"), a Toronto, Ontario-based investment management firm with approximately $2 billion in assets under management, as well as various investment vehicles managed by the firm (the "BFI Funds"), were placed in receivership on April 30, 2021, on application by the Ontario Securities Commission ("OSC"). BFI is registered with securities regulators in all provinces and territories in Canada as a restricted portfolio manager and an exempt market dealer. The Enforcement Staff of the OSC is conducting an ongoing confidential investigation centred around allegations that BFI and certain of its officers, directors, and shareholders have: appropriated amounts from the BFI Funds for personal gain; mismanaged the BFI Funds, including by failing to disclose material conflicts of interest; breached numerous securities laws and regulations, including by misleading Enforcement Staff; and failed to act in the best interests of the Respondents’ stakeholders. As such, the OSC sought and was granted a receivership order pursuant to section 129 of the Ontario Securities Act. PwC was appointed receiver.
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.
2624827 Ontario Inc., a Brampton, Ontario-based company, had its property municipally known as 105 Main Street in Parkhill, Ontario (the "Mortgaged Property") placed under receivership on April 19 on application by C & K Mortgage Services Inc., owed approximately $2.1 million under a loan between the parties (the "Loan"). The Mortgaged Property consists of a .47 acre parcel upon which an Esso station with a small convenience store and vacant restaurant previously operated. Due to a fuel shortage and insufficient funds to replenish the fuel inventory, the gas station was eventually shut down. The Loan is currently in financial default and the applicant has not received any payments since January 12, 2021. Rosen Goldberg was appointed receiver. Dickinson Wright is counsel to the applicant.
Central Park Ajax Developments Phase 1 Inc., an Ontario corporation incorporated for the purpose of building a planned residential real estate development, along with various related companies, had their properties located at 134, 148, 152, 184/188, 214, 224 and 226 Harwood Avenue South, Ajax, Ontario (the "Harwood Properties") placed under receivership on April 15 on application by 2615333 Ontario Inc. Pursuant to a Loan Purchase Commitment dated May 16, 2018, the applicant paid approximately $8.6 million to purchase certain loans which had been advanced to the companies by Toronto Capital Corp. and a syndicate of investors. The applicant also provided further loan facilities to the companies. Currently, the Town of Ajax has asserted a right to re-purchase some of the Harwood Properties. The companies dispute the litigation on the basis that the proposed repurchase price is unconscionably low and that it will result in unjust enrichment to the Town of Ajax, to the detriment of the other stakeholders. RSM Canada was appointed receiver. Counsel is Garfinkle Biderman for the applicant, Blaney McMurtry for the companies, and Ritchie Ketcheson Hart & Biggart for the Town of Ajax.
The Midas Investment Corporation, a Mississauga, Ontario-based company which owns two real properties in Toronto, Ontario (the "Properties"), was placed in receivership on April 6 on application by various entities, including The Bank of Nova Scotia Trust Company, which hold a first-ranking mortgage over the Properties (the "First Mortgage"). The company has been in financial default under the First Mortgage since October 1, 2013 and it now owes more than $11.0 million to the applicants. The applicants had previously been prevented from enforcing the First Mortgage due to an action in the Ontario Superior Court of Justice brought by Thomas Patrick Farrell, the company's President, seeking a declaration that the First Mortgage is unenforceable. The Court, which dismissed Farrell's action, found that he had tried to insulate the Properties from his Irish creditors and a significant portion of the First Mortgage proceeds were applied to the benefit of Farrell and the company. The applicants now allege that under Farrell's control, one of the Properties has been a wasting asset with no cash-flow since the First Mortgage went into default in 2013. The applicants also allege that Farrell has been enjoying a steady rental stream from the other Property without having to account to anyone. Rosen Goldberg was appointed receiver. Counsel is Dickinson Wright for the applicants and Maurice J. Neirinck & Associates for the company.
Spartan Bioscience Inc., a Nepean, Ontario-based biotechnology company that developed a rapid COVID-19 testing device, filed an NOI on April 5, listing approximately $73.0 million in liabilities. The company filed for insolvency protection after finding an undisclosed problem with the technology and pausing shipments of its COVID-19 testing cube. The company is laying off 60 employees (around 70% of its workforce) and working to restructure and refine the performance of the COVID-19 test in the field. EY is the proposal trustee.
Ontario Electronic Stewardship ("OES"), a not-for-profit organization that operates a regulated recycling program in Ontario, submitted a wind-up plan (the "Plan") for its Waste Electrical Equipment Program to the Resource Productivity and Recovery Authority in July 2019. As contemplated by the Plan, the board of directors of OES passed a resolution in February 2021 requiring OES to be wound up voluntarily under the provisions of the Corporations Act (Ontario). On April 1, Deloitte was appointed liquidator.
Aluminart Products Limited, Arcor Windows & Doors Inc., and N.A.P. Windows & Doors Ltd., Ontario companies that manufacture and distribute storm doors, patio doors, and windows to retailers such as Loews and Home Hardware, were placed in receivership on March 29 on application by RBC, owed approximately $5.2 million (CAD) and $24.5 thousand (USD) under a loan agreement. Despite multiple forbearance extensions, the companies have yet to repay their indebtedness to RBC. In addition, the companies failed to deposit $475.0 thousand into their RBC bank accounts as promised. msi Spergel (GRIP) was appointed receiver. Counsel is Minden Gross for the applicant, Miller Thomson for the companies, Harrison Pensa for the receiver, and Lipman Zener Waxman for BDC.
1908736 Ontario Limited (fka Cole Engineering Group Ltd.) and CEG Partners Inc., two Markham, Ontario-based companies that provide specialized advisory, consulting, and engineering solutions, filed for bankruptcy on March 26. Cole Engineering Group Ltd. lists approximately $2.2 million in assets and $3.7 million in liabilities, including $2.4 million to Mohsen Mortada. CEG Partners Inc. lists approximately $2,231 in assets and $1.0 million in liabilities. Farber is the bankruptcy trustee.