Frigid Rentals Inc., an Ontario-based specialty transportation equipment leasing and fleet services company, filed a notice of intention to make a proposal on October 16, 2026, with approximately $136.8 million in secured and unsecured liabilities, including approximately $104.6 million owing under credit facilities administered by Third Eye Capital Corporation. On November 12, Justice Dunphy of the Ontario Superior Court of Justice (Commercial List) approved a $1.6 million debtor-in-possession financing facility backed by Third Eye, extended the company's stay of proceedings to December 30 and authorized additional restructuring protections as Frigid prepares to pursue a sale and investment solicitation process. Ernst & Young Inc. is serving as proposal trustee.
Headquartered in Vars, Ontario, Frigid provides specialized trailer leasing, rental, maintenance, repair, refrigeration installation and fleet modification services to customers in the grocery, pharmaceutical and industrial sectors. The company operates primarily from a 48,000-square-foot facility in Vars, along with a smaller repair location in Salisbury, New Brunswick, and employed approximately 35 full-time employees at the time of filing. Its ownership is divided between lenders under its senior credit agreement, which hold a 51% interest, and entities controlled by or associated with founder Dan Renaud, which hold the remaining 49%.
Frigid's financial difficulties began in late 2023 amid a prolonged downturn in the Canadian trucking and logistics industry, reduced rental demand, compressed rental rates and rising equipment maintenance and labour costs. Customers increasingly extended the useful lives of existing equipment rather than replacing it, eroding margins under older fixed-rate service contracts. The company's move to its Vars facility in 2024 added further pressure, with delays, approximately $2.4 million in build-out costs and excess operating capacity contributing to working capital shortfalls. Despite headcount reductions, compensation adjustments, lease modifications and negotiated rent abatements, Frigid continued to experience liquidity constraints.
In June 2026, Frigid completed a major debt exchange with Finloc 2000 Inc., transferring approximately 1,302 equipment assets in exchange for the retirement of approximately $65 million in capital lease obligations. Frigid was retained as the primary maintenance provider for 934 units of the transferred equipment, allowing it to continue generating service revenue while reducing its debt burden. Although the transaction reduced cash losses, it did not restore financial stability, and Frigid remained dependent on advances from Third Eye to maintain operations.
As of November 1, approximately $104.6 million remained outstanding under Frigid's senior secured facilities, comprising approximately $60.7 million in principal and $43.9 million in accrued interest and other amounts. The company was in default of certain interest payment obligations, and the lenders had not agreed to forbear from enforcement. Frigid also owed approximately $1.2 million under a promissory note to Finloc relating to equipment that could not be located and delivered in the debt exchange, while its approximately $31 million in unsecured liabilities included $1.9 million in HST arrears. Several creditors had commenced collection or enforcement efforts, including Sterling Ford Sales (2020) Inc., which sought to repossess certain vehicles and claimed approximately $307,000 in damages.
Following the NOI filing, Third Eye advanced approximately $597,691 in emergency funding to support payroll and critical operating expenses. The Court subsequently approved a $1.6 million DIP facility, which is expected to provide sufficient liquidity to maintain operations through January 17, 2027.
Frigid is pursuing a going-concern restructuring through a proposed sale and investment solicitation process led by EY, with assistance from EY-Parthenon's mergers and acquisitions professionals. Preliminary outreach began on November 9, with approximately 51 strategic and financial parties contacted and non-binding letters of intent requested by December 7. The company is also exploring a potential stalking horse bid and may seek to continue the proceedings under the CCAA, depending on the outcome of the sale process.
Several disputes remain unresolved, including disagreements over whether certain equipment leases constitute true leases or financing arrangements and a lien registered by an entity associated with the C&C Group of Companies against equipment transferred to Finloc. Justice Dunphy scheduled a December 10 hearing concerning the latter dispute, which involves approximately $369,000 in contested payments and could affect Frigid's available liquidity. Finloc has been directed to preserve the status quo pending the hearing.
EY is the proposal trustee. Counsel includes Bennett Jones for Frigid, TGF for the proposal trustee, and Stikeman Elliott for Third Eye Capital as agent for the senior secured lenders and DIP lender.
