NextPoint Financial, Inc. (TSX:NPF) et al., CCAA

NextPoint Financial, Inc. (TSX:NPF) et al., a Vancouver, British Columbia-based group of companies which provides financial and tax services to small businesses and consumers across Canada and the US, obtained CCAA protection on July 25, 2023. One of the group’s primary business lines is Liberty Tax, a tax preparation service provider with over 250 locations in Canada and 2,300 in the US, the vast majority of which are franchised. The companies are over-leveraged and have recurring operating losses and working capital deficiencies. As at July 14, 2023, the companies have an outstanding debt load of approximately $285 million. The current situation is the result of macroeconomic factors caused by the COVID-19 pandemic, which led to an unsustainable capital structure driven by outsized leverage to the businesses’ ability to service. The companies have also filed for relief under Chapter 15 of the US Bankruptcy Code. FTI is the Monitor, represented by Fasken. DLA Piper is counsel for the companies and McCarthy Tétrault is counsel for First Century Bank.

By: Dina Milivojevic