Dean Myers Chevrolet, a North York, Ontario-based car dealer, was placed in receivership on February 12 on application by RBC, owed approximately $9.2 million. An audit conducted by RBC in January 2020 revealed that the company had been selling vehicles without remitting the required repayments to RBC from the sale proceeds as required under its floor plan financing agreement. As of February, the amount of funds improperly withheld from RBC is estimated to be $2.7 million. Deloitte was appointed receiver. Counsel is Aird & Berlis for the applicant and Loopstra Nixon for the company.
Air Georgian, Toronto, Ontario-based regional aircraft operator, filed an NOI on January 31. The company operated over 62,000 regional flights per year on behalf of Air Canada through a capacity purchase agreement. This contract, however was not renewed on January 31. While under creditor protection, the company will look to secure a new business relationship. KPMG is the proposal trustee. Counsel is GSNH for the company, Chaitons for proposal trustee and Dentons for the senior secured lender.
SFP Canada, a Mississauga, Ontario-based company that operates 76 retail stores across Canada under the Papyrus, Carlton Cards, and Paper Destiny brand names, filed for protection under the CCAA on January 23, listing approximately $11.8 million in liabilities. The company is owned by Schurman Fine Papers ("SFP", and together with SFP Canada, the "Schurman Group"), the leading privately held American retailer of personal expression products in North America. American Greetings Corporation previously supplied the majority of products sold by the Schurman Group. In the past few years, the Schurman Group has faced various liquidity pressures caused by, amongst other things, the general downturn in the brick-and-mortar retail industry; the decline in the value of the Canadian dollar since 2009; and a significant price increase in American Greetings' products. As a result of these financial challenges, the Schurman Group fell behind on payments to American Greetings, and American Greetings terminated their agreements in December 2019. The Schurman Group can no longer operate as a going concern. On January 22, SFP filed for Chapter 11 bankruptcy in the US. Similarly, SFP Canada cannot continue operating without the full support of its US affiliates, on whom the company is entirely dependent. Richter was appointed monitor. Canadian counsel is Osler for SFP Canada, Stikeman Elliott for the monitor, and Blakes for American Greetings.
Medlantis, a Toronto, Ontario-based company that was incorporated by Dr. Kieran Murphy to acquire an online medical education platform originally developed and operated by the University Health Network, filed for bankruptcy on January 22, listing $5.1 million in liabilities, including $2.4 million to Dr. Helmut Schuehsler and $1.3 million to Dr. Murphy. The company's technology allows for data mining of thousands of hours of medical lectures, cases, procedures, workshops, and demonstrations, designed to make expert clinical answers accessible to everyone, everywhere, fast. Despite its promising potential, the company struggled to generate subscription revenues and over time began to fall in arrears with its suppliers. After attempts to raise additional capital proved unsuccessful, the company filed an assignment in bankruptcy. Link & Associates is the bankruptcy trustee.
Thomas Sabo Ltd./Ltee., a jewellery retailer, filed an assignment in bankruptcy on January 21, 2020. The purpose of the filing was to complete the restructuring of the Canadian operations from bricks and mortar to an e-commerce business model. With 11 remaining physical locations across Canada, after voluntarily closing other locations in the past, and employing approximately 80 employees, the company had been experiencing declining revenue and losses from most of its mall locations. Grant Thornton is the bankruptcy trustee. Dale and Lessmann LLP is counsel for the company.
Campus Vibe, a Mississauga, Ontario-based student event organization and management platform, filed for bankruptcy on January 17, listing $109.5 thousand in liabilities. Farber is the bankruptcy trustee.
Sle-Co Plastics, a St. Thomas, Ontario-based Tier 2 automotive parts supplier operating from real property in St. Thomas, was placed in receivership on January 9 on the motion of RBC, owed CAD $5.6 million and USD $2.3 million. Sle-Co Properties, which owns the St. Thomas property, owes RBC $3.5 million. During 2018, the company consolidated three production locations in London, Ontario into the one St. Thomas property. Cost overruns in preparing this new facility, re-location costs, operational issues on start-up, and the conclusion of a major contract all negatively impacted the company's financial position. In September 2019, Sle-Co Properties entered into an agreement of purchase and sale for the sale of the St. Thomas property to a third party, to be leased back to the company on certain conditions. The agreement eventually lapsed and the two companies were unable to obtain re-financing. On November 5, the company filed an NOI and BDO was appointed proposal trustee. The companies attempted to restructure their affairs through the sale of all or a portion of their assets, including the St. Thomas property. Based on the outcome of this sales process, the company determined it would not be able to file a viable proposal. Accordingly, the company will be deemed bankrupt after January 18, and a receiver will be required to complete the sales process initiated by the company. BDO was appointed receiver. Counsel is Harrison Pensa for RBC, Advocates for the companies, and Aird & Berlis for the receiver.
Sudbury Regional Hearing Services, a privately-owned corporation that owns and operates hearing clinics in northern Ontario, and which was amalgamated with Bruserfactory (collectively, the "Debtor"), was placed in receivership on January 7 on application by Sivantos, a supplier and lender owed approximately $3.0 million. The Debtor, which did not provide Sivantos with advanced notice of its amalgamation, is in default of its obligations to Sivantos under their loan agreement. BDO was appointed receiver. Weaver, Simmons is counsel to the applicant.
Dion Global Solutions (Canada), the Canadian branch of a global financial technology company based in India, filed for bankruptcy on December 30, listing $4.5 million in liabilities, including $3.2 million to FTI Consulting Hong Kong and $1.3 million to FTI Consulting Singapore. Farber is the bankruptcy trustee.
Lydian International (TSX: LYD), a Toronto, Ontario-based gold exploration and development company focused on construction of a gold mine in south-central Armenia, obtained protection under the CCAA on December 23. The company obtained an exploration license in 2006 and since then has invested more than $400.0 million in the project. The mine was 75% complete in May 2018 when a new prime minster came to power in Armenia. After the change in government, demonstrations and road blockades occurred sporadically throughout Armenia, including at the company's project. In addition to the blockades, additional audits and investigations have been imposed on the company, and a material water supply agreement was unilaterally terminated. As a result of these external factors, the company has dismissed more than 90% of its workforce and terminated substantially all of its supply relationships. The group has also defaulted on substantially all of its obligations to its lenders. Since October 2018, the company has entered into multiple forbearance agreements with its lenders, the most recent of which expired on December 20. 2019. While under creditor protection, the company will continue discussions with stakeholders in an attempt to restart construction. It will simultaneously canvas the market for parties interested in funding either the project or the company's potential international arbitration proceedings against the Armenian government. Edward Sellers of Black Swan Advisors is the company's interim president and CEO. Alvarez & Marsal is the monitor. Counsel is Stikeman Elliott for the company, TGF for the monitor, Blakes for Resource Capital Fund VI L.P., Norton Rose Fulbright for OSISKO Bermuda Limited, Torys for ORION Capital Management and DLA Piper for ING Bank N.V./ ABS Svensk Exportkrerdit (publ).