6 total
Court approves CCAA transition arrangements, DIP financing, and business preservation plan suspending pension and OPEB payments.
In the context of CCAA proceedings for U.S. Steel Canada Inc. (USSC), the applicant sought approval for Transition Arrangements with its parent company, a Business Preservation Plan involving significant cash conservation measures (including suspension of pension, OPEB, and municipal tax payments), and Amended DIP Financing.
The court approved the motions, finding that the Transition Arrangements were fair and reasonable, and that the Business Preservation Plan and DIP financing were necessary to allow USSC to continue operations and pursue a restructuring solution, despite objections from the union and municipalities regarding the suspension of benefits and taxes.
Lump sum retention bonuses found to be post-filing compensation and ordered paid in CCAA proceedings.
In the context of CCAA proceedings for U.S. Steel Canada Inc., three former employees brought a motion seeking payment of lump sum retention bonuses under their severance agreements.
The respondent argued the payments were pre-filing obligations subject to the CCAA stay.
The court found the bonuses were compensation for post-filing services, as they were contingent on the employees remaining available to work during the notice period.
The court exercised its discretion to order payment, finding it fair and equitable as it would not create an unfair priority over other employees and the amounts were de minimus.
Court approves coke conversion agreement and grants sealing order in CCAA restructuring.
In ongoing restructuring proceedings under the Companies’ Creditors Arrangement Act, the debtor company sought court approval of a coke conversion agreement with its parent corporation.
The motion was brought on an urgent basis due to operational deadlines relating to coal shipments and winter shipping constraints on the Great Lakes.
The monitor supported the agreement and reported that it would be cash‑flow positive, would recall employees from temporary layoff, and would not interfere with the ongoing sales and restructuring process.
The court held that it had jurisdiction under s. 11 of the CCAA and found the agreement appropriate in the circumstances.
A sealing order was also granted to protect confidential commercial information contained in an unredacted version of the agreement.
Unopposed motion for distribution process under Bulk Sales Act granted despite court's concern over minimal creditor recovery.
The applicant sought directions regarding a creditor claims and distribution process under the Bulk Sales Act for residual net sales proceeds of $5,458.91.
The motion was unopposed.
The court approved the order but expressed significant discomfort with the applicant's use of the Bulk Sales Act, noting that the statute is designed to protect creditors 'in full', whereas in this case, trade creditors would receive virtually nothing after professional fees and priority claims were paid.
The court suggested that the Bulk Sales Act should be limited to situations where creditors will be paid in full, with insolvency legislation used otherwise.
Court approves CCAA sale and denies representative counsel for terminated employees.
In a Companies’ Creditors Arrangement Act restructuring, the applicants sought court approval of a sale transaction to BlackRock Kelso Capital Corporation, authorization to assign certain store leases and designated contracts, and related relief.
A former employee also moved to be appointed as representative of terminated employees and to appoint representative counsel funded from transaction proceeds to assist with potential Wage Earner Protection Program Act claims.
The court approved the sale transaction and the assignment of leases and contracts under ss. 36 and 11.3 of the CCAA, finding the sale process reasonable and the transaction maximized value while preserving employment and ongoing operations.
The court declined to appoint representative counsel for terminated employees, holding the proceeding lacked the complexity seen in cases such as Nortel and Canwest, and that WEPPA claims could be addressed in the anticipated bankruptcy process by the trustee.
Funding representative counsel from the purchaser’s transaction funds was also found inappropriate.
Court approves CCAA sale and rejects late competing bid to protect sale process.
The applicants sought approval under the Companies’ Creditors Arrangement Act for a sale of substantially all of their assets following a court‑approved sales and investor solicitation process.
The court considered the statutory factors in s. 36 of the CCAA, including the fairness and reasonableness of the process, the role of the monitor, consultation with creditors, and the adequacy of the consideration.
A late competing bid was rejected to preserve the integrity of the court‑approved sales process.
The court also addressed priority issues involving a DIP lender, secured creditors, and potential claims to HST refunds under the Financial Administration Act.
The proposed transaction and distribution scheme were approved as fair and reasonable in the circumstances.
