Quebec

Nemaska Lithium (TSX: NMX)

Nemaska Lithium (TSX: NMX), a Montreal, Quebec-based minerals mining company, obtained protection under the CCAA on December 23. The company is is in the process of developing a mine in the James Bay Region of Quebec that it hopes will enable it to become one of thew world's most significant lithium salts producer and supplier to the emerging lithium battery market. To date, over $616.0 million has been spent on construction and engineering costs, funded by a combination of debt and equity from government and private sources, including Softbank. In February 2019 it was determined that additional funds of approximately $375.0 million were required to complete construction of the mine and processing plant. Significant efforts were undertaken to find investors, buyers or partners but to date no binding agreements have been reached. Despite a strong long-term outlook for lithium, prices have recently plummeted as a result of increased supply, primarily from Australia, where producers have lower extraction costs and are in closer proximity to the Chinese markets. The mine is currently in a care and maintenance program as the company seeks to conserve cash while it evaluates its restructuring options. PwC is the monitor. Counsel is McCarthy Tétrault for the company, Goodmans and Woods for Nordic Trustee AS, Miller Thomson for Bird Civil & Mines, Torys for OMF Fund II (N) Ltd., Dentons for Chubb Insurance, Norton Rose Fulbright for Investissement Québec and Lavery for Allied World Specialty Insurance

8318085 Canada

8318085 Canada, a Montreal, Quebec-based company which designs, imports and distributes women’s outerwear garments, its main focus being coats, filed an NOI on December 17, listing $10.8 million in liabilities, including $2.1 million to RBC and $1.1 million to Jiangsu Sainty Glorious Trade. Several factors led to the company’s insolvency, including a reduction in sales as well as the introduction of a new software system that resulted in inaccurate reporting of the business’ performance. Although the company is currently still in operation, it must promptly complete its activities related to the spring and winter 2020 seasons - such as booking orders and making purchases - in order to maintain viability. As part of the restructuring, the company will undergo a sale and solicitation process to market the business to potential acquirers, investors, or strategic partners. KPMG is the proposal trustee. Kugler Kandestin is counsel to the company.

Fortress Global Enterprises (TSX: FGE)

Fortress Global Enterprises (TSX: FGE), a Montreal, Quebec-based company engaged in the dissolving pulp business and the renewable energy generation sector, obtained protection under the CCAA on December 16. Previously known as Fortress Paper, the company changed its name in 2018 to reflect its intention to shift away from traditional pulp and paper operations and pursue opportunities in new business segments. The majority of the company's revenues is now derived from the production and sale of dissolving pulp, a product with a variety of commercial applications, including the production of rayon textile fibres. The market for dissolving pulp, however, has not been favourable for the company, with prices dropping from almost $950 USD per ton in 2017 to $640 USD per ton this year. Other factors have also contributed to the company's financial difficulties, including the recent Sino-American economic conflict which is disrupting markets and the garment sector which Fortress serves. In the past three years, the company has lost approximately $246.6 million. In consultation with its senior secured lenders, the company launched a sale and investment solicitation process in August 2019 with the assistance of Houlihan Lokey but to date has failed to receive any indications of interest. With no liquidity to operate in the normal course, the company's senior secured lenders, Investissement Québec (IQ) and Fiera, made an application on the company's behalf for creditor protection. While under creditor protection, it is anticipated that the company's pulp mill will be indefinitely idled while the company waits for market conditions to improve. Concurrently, the company will explore other ways to return to profitability, including potentially modernizing and upgrading its current facilities with the assistance of a new investor. Deloitte is the monitor. Counsel is BCF for the company, McCarthy Tétrault for the monitor, Stikeman Elliott for IQ, Miller Thomson for Fiera, Blakes for International Forest Products and Goodmans for Computershare.

Bentley Leathers

Bentley Leathers, a Montreal, Quebec-based retailer of luggage, handbags and travel accessories, filed an NOI on November 26. Attributing its financial difficulties to changing consumer behavior and the impact of digital disruptions, the company plans to close 100 of its 250 stores across Canada through the proposal proceedings. KPMG is the proposal trustee. Hilco has been retained to liquidate the closing stores. Counsel is Davies for the company, McCarthy Tétrault for the proposal trustee, Osler for Hilco and Miller Thomson for CIBC, the company's senior lender owed approximately $18.0 million.

Gestion Knightsbridge

Gestion Knightsbridge, a Montreal, Quebec-based residential real estate developer, filed an NOI on November 15, along with certain related companies. Richter is the proposal trustee.

Bouclair

Bouclair, a Montreal, Quebec-based retailer of home fashion and decor products, filed an NOI on November 11. Founded in 1970, the company has grown to 92 locations across Canada and employs approximately 1,150 employees. It also sells online and through a wholesale business that operates internationally. Over the past few years, the company has struggled amidst increased competition from large-scale discount US retailers such as Walmart, and online retailers such as Amazon and Wayfair. Internally, the company has also faced issues. A new warehouse management system system led to operational difficulties, and various locations significantly underperformed as a result of high rents, the increase in minimum wage, and the company's inability to recruit strong talent to manage the stores. Cost-cutting measures have not returned the company to profitability. Through the proposal proceedings, the company will look to complete a transaction that will see a significant portion of the company's assets sold to a new investor group led by the company's current president. It is anticipated that 29 stores will be closed and liquidated as part of the restructuring. Deloitte is the proposal trustee. Richter is financial advisor to National Bank, the company's senior lender owed approximately $18.8 million. EY conducted the company's pre-filing SISP. Gordon Brothers is conducting the liquidation. RC Benson is CRO. Counsel is Stikeman Elliott for the company, Osler for the proposal trustee, Fasken for Gordon Brothers, McCarthy for National Bank and Davies for certain other subordinated lenders.

Cartise

Cartise, a Montreal, Quebec-based distributor of women's fashion and apparel, was placed in receivership on October 24 on application by HSBC, owed approximately $1.3 million. Operating for over 40 years, the company sold to various boutiques and other retailers across Canada and the United States. EY was appointed receiver. Davies is counsel for the applicant.

9227-1584 Quebec Inc., and 9336-9262 Quebec Inc.

9227-1584 Quebec Inc., and 9336-9262 Quebec Inc., two related companies that are developing Square Candiac, a complex and multifaceted mixed-used construction and development project on approximately 45 acres of land on the south shore of Montreal, Quebec, obtained protection under the CCAA on November 22. While some aspects of the project have been completed, the companies have no immediate liquidity and progress on the project has stalled. A shareholder dispute led to the appointment of KPMG as administrative agent and manager of the companies. Upon its appointment, KPMG determined that the companies were insolvent and required interim financing and a stay of proceedings to effect a restructuring or a continuation of the company's operations and made an application for creditor protection on the companies' behalf. KPMG is monitor and has been granted additional powers to manage the project. Counsel is Blakes for the monitor, Dentons for one of the project's co-owners, Langlois for the other co-owner, Jolicoeur Lacasse for BDC and BLG for Gerpro Construction.

Biomod Concepts

Biomod Concepts, a Sainte-Julie, Quebec-based biotechnology company, filed a proposal on October 17. Founded in 2009, the company is involved in the research and development of an innovative delivery system of active ingredients for the beauty and health industries. Facing a liquidity crisis earlier in the year, the company temporarily ceased operations and filed an NOI on April 8. A sale process yielded no bids for the business or its assets, but the company's principal shareholder has structured a transaction that will see the company's core business and technology transferred to a new entity. The company's primary secured creditors, Investissement Québec (IQ) and Quantius Innovation Income Fund LP, together owed approximately $6.3 million, have consented to the transaction, and IQ will be a preferred shareholder of the company under the new structure. The purchaser has also advanced $300.0 thousand to fund a proposal, which translates to a distribution of 22 cents on the dollar for unsecured creditors. Richter is the proposal trustee. Counsel is Gowling WLG for the company and BLG for Quantius.

CO2 Solutions (TSX-V: CST)

CO2 Solutions (TSX-V: CST), a Quebec City, Quebec-based technology company, filed an NOI on September 16, listing approximately $12.2 million in liabilities. The company was developing the technology to capture and purify carbon dioxide emitted from fossil fuel power plants, pulp and paper mills and other large emitters of carbon dioxide. The company commissioned its first commercial project at a pulp mill of Resolute Forest Products in Saint-Félicien, Québec in March 2019. The project experienced significant cost overruns though, and in April 2019 the company's board announced that it was creating a special committee to review its strategic options. The strategic review will continue while the company is under creditor protection. EY is the proposal trustee.

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