Oak and Fort Corp. et al., CCAA

Oak and Fort Corp. et al. (the “O&F Group”), a Vancouver, British Columbia-based retailer which operates 42 stores (26 in Canada and 16 in the US), had its NOI proceedings continued under the CCAA on June 6.

The companies have secured debt of approximately $3.19 million and unsecured debt of approximately $17.35 million with their Canadian entities and unsecured debt of approximately $4.59 million with their US entities.

Beginning in 2021, the O&F Group pursued aggressive brick-and-mortar growth. Following those growth efforts, the O&F Group’s revenues grew both in Canada and in the US, but not to the extent anticipated. Further, recent market conditions (including increased interest rates, inflationary pressures, and impacts and uncertainty arising from the recent US tariff regime) have caused costs relative to revenue to increase sharply while simultaneously depressing consumer demand.

While the O&F Group has attempted to mitigate losses through inventory reductions and various cost-cutting measures, these efforts accelerated revenue decline and margin erosion. The companies are in arrears with virtually all of their landlords and suppliers and filed NOIs on an urgent basis on June 2 and 3 after several landlords threatened enforcement action.

The principal purpose of the insolvency proceedings is to create a stabilized environment to provide O&F with the breathing room necessary to negotiate a DIP facility, and to fund a comprehensive restructuring of the business with a view to emerging as a going-concern.

KSV is the monitor and Reflect Advisors is the CRO.

Counsel is Fasken for the O&F Group, Bennett Jones for the monitor, Kornfeld for BDC, MCM Law for RBC, Torys for Cadillac Fairview, Camelino Galessiere for Ivanhoé Cambridge (JLL) and Morguard, and Whitelaw Twining for Low Tide Properties Ltd.