0932293 B.C. Ltd. (o/a CELLICON)

0932293 B.C. Ltd. (o/a CELLICON), an Abbottsford, British Columbia-based company that provides retail sales of wireless accessories, as well as phone repair services at mall-based kiosks and stores, was deemed to have filed an assignment in bankruptcy on March 2, listing approximately $362.0 thousand in assets and $1.8 million in liabilities. Most of CELLICON's locations are operated by independent operators under Management Services Agreements ("MSAs"). Like others in the retail sector, CELLICON's business was adversely impacted by the various restrictions and closures arising from the COVID-19 pandemic. More recently, CELLICON's cash flows were negatively impacted by certain operators' refusal or inability to pay the fees due under the MSAs. In response, on February 19, CELLICON filed an NOI with a view to stabilizing its business. After CELLICON realized it could not fund payment of its March 2021 rent, however, it chose not to file the cash flow projections required under the BIA, resulting in it being deemed to have filed an assignment in bankruptcy. Counsel to certain of the operators have indicated that the MSAs are not compliant with various franchise laws across Canada and, as such, have advised that the operators will have claims against CELLICON that would set off any amounts owed under the MSAs. MNP is the bankruptcy trustee.