Flex-Cap Inc., Bankruptcy

Flex-Cap Inc., a Québec-based equipment financier to small and medium sized enterprises as well as owner-operators and self-employed individuals, filed an assignment in bankruptcy on May 2, listing $27.3 million in liabilities, including approximately $11.1 million to CWB Maxium.

The company recently found itself at a crossroads. As the company struggled to meet its liabilities, its secured creditor took over management of a majority of its assets which were pledged as collateral (over 300 active direct finance leases).

Flex-Cap’s insurance was also set to expire by June 2025, and the company did not expect to have funds to continue its operations by then.

PwC, in its capacity as bankruptcy trustee, renounced its rights in Flex-Cap’s property due to the fact that its assets are subject to a movable hypothec in favor of NBC (due to CWB’s acquisition by NBC), and the realization value of the assets along with the professional fees required for their management and liquidation would not suffice to fully repay the secured creditor, let alone allow any distribution to unsecured creditors.

Counsel is Norton Rose Fulbright for the trustee and Miller Thomson for NBC.