COURT FILE NO.: CV-22-684542-00CL

DATE: 2022-08-03

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: IN THE MATTER OF THE COMPANIES’ CREDITORS ARRANGEMENT ACT, R.S.C. 1985, c. C-36, AS AMENDED

AND IN THE MATTER OF A PLAN OF COMPROMISE OR ARRANGEMENT OF MPX INTERNATIONAL CORPORATION, BIOCANNABIS PRODUCTS LTD., CANVEDA INC., THE CING-X CORPORATION, SPARTAN WELLNESS CORPORATION, MPXI ALBERTA CORPORATION, MCLN INC., AND SALUS BIOPHARMA CORPORATION

BEFORE: Chief Justice G.B. Morawetz

COUNSEL: Sean Zweig, Mike Shakra and Thomas Gray, for the Applicant Kyle Plunkett and Sam Babe, for the proposed Monitor, KSV Restructuring Inc. Kenneth Kraft and Sara-Ann Wilson for the proposed DIP Lender Alex Moore, for the Debenture Trustee

HEARD and DETERMINED: July 25, 2022

REASONS: August 3, 2022

ENDORSEMENT

INTRODUCTION

[1] At the conclusion of the hearing, the Applicants were granted relief under the CCAA with reasons to follow. These are the reasons.

[2] MPX International Corporation (“MPXI”), BioCannabis Products Ltd. (“BioCannabis”), Canveda Inc. (“Canveda”), The CinG-X Corporation (“CinG-X”), Spartan Wellness Corporation (“Spartan”), MPXI Alberta Corporation (“MPXI Alberta”), MCLN Inc. (“MCLN”), and Salus BioPharma Corporation (“Salus BioPharma”) (each individually, an “Applicant”, and collectively, the “Applicants”) seek relief under the Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-36, as amended (the “CCAA”) and the issuance of an order (the Initial Order”)

[3] MPXI is a reporting issuer listed on the Canadian Securities Exchange. It wholly-owns each of the other Applicants, and wholly-owns or has an interest in several other non-Applicant affiliates (each subsidiary of MPXI individually a “Subsidiary” and together the “Subsidiaries”, and collectively with MPXI, the “Company”). Through its Subsidiaries, it is involved in cannabis production and resale, management consulting for cannabis companies, and cannabis education.

[4] The Applicants are in a liquidity crisis and are not able to meet their obligations as they become due. Absent the approval of the interim financing proposed to be made available under the DIP Loan (as defined below), the Company will not be able to fund its next payroll scheduled to be paid on July 29, 2022. The Applicants believe that this CCAA proceeding is in the best interests of their stakeholders.

[5] The Applicants submit that the relief sought in the Initial Order is limited to what is reasonably necessary to allow the Applicants to maintain the status quo and continue operations in the ordinary course during the initial 10-day stay of proceedings (the “Stay of Proceedings”). The Applicants intend to return to this Court for additional relief necessary to advance the CCAA proceedings at a hearing to be scheduled prior to the expiration of the Stay of Proceedings (the “Comeback Hearing”).

FACTS

[6] The facts underlying this Application are more fully set out in the affidavit of Jeremy Blumer, sworn July 25, 2022 (the “Initial Affidavit”). All capitalized terms used but not defined herein have the meanings ascribed to them in the Initial Affidavit.

[7] All of the Applicants are Canadian companies. MPXI is the ultimate parent company, and all of the other Applicants are wholly-owned by MPXI. Each of the Applicants is incorporated under the Business Corporations Act, R.S.O. 1990, c. B.16 (Ontario) (the “OBCA”), the Business Corporations Act (Alberta), RSA 2000, c B-9 (the “ABCA”) or the Canada Business Corporations Act, RSC 1985, c C-44 (the “CBCA”).

[8] MPXI was incorporated under the OBCA by articles of incorporation dated October 17, 2018. At the time of its incorporation, MPXI was a subsidiary of MPX Bioceutical Corporation (“MPX Bio”). It was incorporated in order to effect a plan of arrangement (the “Arrangement”) among MPXI, MPX Bio and iAnthus Capital Holdings Inc. under the Business Corporations Act (British Columbia), SBC 2002, c 57.

[9] The Canadian cannabis “plant-touching” operations of the Company are conducted through Canveda, which was incorporated under the CBCA. Canveda is a licensed cultivator, processor, and seller under the Cannabis Act, and maintains a fully constructed 12,000 square foot facility located in Peterborough, Ontario (the “Canveda Facility”).

[10] Spartan, a CBCA company, and MCLN, an OBCA company, are both in the business of telehealth and cannabis education. Other than MPXI Alberta, which was incorporated under the ABCA, all of the remaining Applicants (BioCannabis, CinG-X, and Salus Biopharma) were incorporated under the OBCA. None of these Applicants currently have any material business, assets, or operations.

[11] Aside from the Applicants, MPXI has partial interests in certain Canadian entities. MPXI holds approximately 50% of the common shares and warrants of Salus International Management Ltd. (“Salus International”), an OBCA company. Salus International controls voting shares representing over 97% of the votes of a Thai corporation, Salus Bioceutical (Thailand) Co., Ltd. (“Salus Bioceutical”). The Applicants contend that Salus Bioceutical is a key and valuable asset for MPXI, and its continued operations will be important for the Applicants to successfully restructure their affairs and maximize value for their stakeholders.

[12] MPXI also holds a minority interest in Prime Pharmaceutical Corporation, which controls another subsidiary. Because MPXI is not involved in the business or operations of these companies, neither are Applicants or Non-Applicant Stay Parties.

[13] The other Non-Applicant Stay Parties are registered in Australia, Lesotho, Malta, Switzerland, South Africa, Thailand, and the United Kingdom. Notwithstanding that these parties are not Applicants, the Applicants believe that it is critical to the best interests of the Applicants and their stakeholders to extend the benefits of the Stay of Proceedings to the Non-Applicant Stay Parties.

[14] MPXI is a multinational diversified cannabis company in the business of developing and operating assets across the international cannabis industry with an emphasis on cultivating, manufacturing and marketing products which include cannabinoids as their primary active ingredient.

[15] Canveda is licensed to produce, sell, and export cannabis. The Canveda Facility produces high quality cannabis flower, and Canveda holds the following licenses:

(a) a license issued by Health Canada to produce, sell, and export all categories of authorized Canadian cannabis products, including topicals, extracts and edibles;

(b) a license issued by the Canada Revenue Agency authorizing Canveda to purchase excise stamps for the purposes of collecting and remitting excise duty on cannabis products;

(c) a license issued by the Alberta Gaming, Liquor & Cannabis Commission authorizing Canveda to market cannabis products in Alberta; and

(d) a license issued by the Saskatchewan Liquor and Gaming Authority authorizing Canveda to supply cannabis to Saskatchewan from its Peterborough location.

[16] MPXI owns several medicinal and recreational cannabis brands and products that are produced and distributed by Canveda across the Provinces of Alberta, British Columbia, Ontario, and Saskatchewan.

[17] Two of MPXI’s Subsidiaries – Spartan and MCLN – focus on telehealth and cannabis education.

[18] The remainder of the Applicants do not have material assets or operations.

[19] Aside from the Applicants, the Company has material assets, including certain facilities and licenses, through the following businesses:

[20] Salus International, which is registered under the OBCA, provides design, planning, financing, training, and on-going operational support to cannabis initiatives, partnerships, and joint ventures in southeast Asia.

[21] Salus Bioceutical is a joint venture between Salus International and certain Thai investors, and Salus International controls over 97% of the votes of Salus Bioceutical. Salus Bioceutical is involved in the cultivation, processing and distribution of high-quality, EU-GMP compliant, medical-grade cannabis products such as CBD distillate, isolate powder, and water-soluble isolate for the medical community in Thailand.

[22] Salus Bioceutical is a Subsidiary with assets and operations into which the Company has invested financial and other resources. The Applicants contend that it is critical for the Company that Salus Bioceutical be able to continue its operations without disruption.

[23] The Company also has operations in Switzerland, South Africa, and Malta. In Switzerland, Holyworld SA is a wholly-owned Subsidiary that leases a laboratory that can produce up to 30kg of distillate per month. Holyworld SA has struggled with cash flow resulting in material unpaid liabilities.

[24] In South Africa, MPXI indirectly holds an 80% interest through another Subsidiary in First Growth Holdings (Pty) Ltd. (“First Growth”). First Growth is licensed to cultivate and export cannabis at a facility it leases, and it is expected that the biomass produced from the First Growth Facility will primarily support the Company’s operations in Malta.

[25] The Company’s operations in Malta are conducted mainly through MPXI Malta Operations Ltd. (“Malta Operations”), a company in which MPXI holds at least 75% of the voting shares, and Alphafarma Operations Ltd. (“Alphafarma”), a company wholly-owned by Malta Operations through MPXI Malta Property Limited. Alphafarma recently obtained EU-GMP Certification, as well as a License for the Production of Cannabis for Medicinal and Research Purposes.

[26] As at March 31, 2022, the Company had total consolidated assets with a book value of approximately $47,133,302, and liabilities with a book value of approximately $37,244,120. The Applicants expect to have only approximately $169,196 cash on hand at the close of business today, and are facing an urgent liquidity crisis.

[27] MPXI has closed multiple tranches of a private placement offering (the “Offering”) of units (the “Units”) of MPXI. Each Unit consists of one 12% secured convertible debenture of MPXI (the “Debentures”, and the holders of the Debentures the “Debentureholders”) in the principal amount of US$1,000, as well as certain common share purchase warrants.

[28] MPXI has struggled to make interest payments under the Debenture Indenture. MPXI failed to make interest payments on the Coupon Date on: March 31, 2021; September 30, 2021; December 31, 2021; and March 31, 2022. After each of these dates, waivers of the event of default provision related to the payment of interest were granted by Debentureholders. In other cases, MPXI has satisfied the payment of interest through the issuance of additional Units.

[29] MPXI has also obtained short-term financing pursuant to a series of loans (the “Bridge Loans”) through which the lenders converted the principal owing into Units in the Offering on terms favourable to the lenders. As of July 21, 2022, the total face value of the principal of outstanding convertible debentures is US$19,281,000. There are no outstanding Bridge Loans because they were all converted to Units.

[30] MPXI’s obligations in respect of the Debentures are secured by the following:

(a) a general security agreement dated June 30, 2020 securing all of the present and after-acquired property of MPXI; and

(b) a pledge agreement dated June 30, 2020 by MPXI pledging all of the shares it holds of BioCannabis, Canveda, Holyworld SA, MCLN, MPX Australia Pty. Ltd., MPXI Alberta, MPXI Malta Holding Limited, MPXI Malta Operations Limited, MPXI UK Limited, Salus BioPharma, Spartan, CinG-X. MPXI also later deposited its shares in Salus International with the trustee of the Debenture Indenture.

[31] The Debenture Indenture is guaranteed by BioCannabis, Canveda, Holyworld SA, MCLN, MPX Australia Pty Ltd, MPXI Alberta, MPXI UK, MPXI Malta Operations Limited, Salus BioPharma, Spartan and CinG-X pursuant to a guarantee agreement dated June 30, 2020, as well as MPXI Malta Holding Limited pursuant to a separate guarantee agreement with the same date. Each of these parties other than Holyworld SA executed general security agreements in favour of the trustee of the Debenture Indenture.

[32] In addition to the obligations owing in relation to the Debentures, Canveda has also assigned a term deposit as security in favour of Alterna Savings and Credit Union Ltd. (“Alterna”) in the amount of $40,000, which amount relates to a letter of credit issued by Alterna.

[33] As of July 20, 2022, Canveda had non-current accounts payable of $789,565.86, Spartan had non-current accounts payable of $126,409.49, and MPXI had non-current accounts payable of $799,635.98.

[34] The Applicants also have employee liabilities. The aggregate payroll for the Company is:

(a) MPXI – approximately $90,000/month;

(b) Canveda – approximately $92,000/month;

(c) Spartan – approximately $79,000/month; and

(d) International (Non-Applicant Stay Parties) – approximately $155,150/month.

[35] In addition, the Applicants are parties to several leases, including in respect of the head office of the Company in Toronto, an operational office in Ottawa, and the Canveda Facility, certain of which are not current.

[36] The Applicants are also in arrears in respect of certain tax obligations, including approximately $503,302 in excise tax arrears.

[37] The Company also engages in intercompany borrowing, through which parent companies lend funds to their subsidiaries, and MPXI has advanced unsecured loans to several of its Subsidiaries. Certain Non-Applicant Stay Parties have other material unsecured liabilities. This includes a promissory note pursuant to which First Growth is a borrower in the amount of up to US$500,000. This loan is now payable and has been put to MPXI, as permitted by its terms. Finally, certain of the Applicants are also defendants in ongoing litigation.

[38] The Applicants have struggled with cash flow since the onset of the COVID-19 pandemic, and their cash position is currently not sufficient to meet their obligations as they come due. They submit that the urgency of this application stems from the need for the Applicants to access financing to meet their ongoing and future payroll obligations and maintain business operations in order to preserve and maximize value while preventing enforcement action by certain contractual counterparties.

[39] Pursuant to a term sheet executed July 25, 2022 (the “DIP Term Sheet”), certain of the Debentureholders holding approximately 52% of the outstanding Debentures have agreed to provide the Applicants, as borrowers, with a super-priority, non-revolving credit facility up to a maximum principal amount of $2.67 million (the “DIP Loan”). The DIP Loan will bear interest at 12% per annum, and also includes a commitment fee equal to 2% of the overall value of the DIP Loan. The funds will be advanced by certain initial Debentureholders listed on Schedule D of the DIP Term Sheet, and all Debentureholders will have an opportunity to participate in the DIP Loan based on their pro-rata share of Debentures held (the Debentureholders that participate in the DIP Loan, the “DIP Lenders”). The DIP Loan will be guaranteed by many of the Non-Applicant Stay Parties.

[40] The DIP Loan is conditional, among other things, upon the granting of a priority charge in the amount of $1.2 million over the Property in favour of the DIP Lenders to secure the amounts borrowed under the DIP Loan.

[41] The Applicants contend that the amount of the DIP Loan to be funded during the Stay of Proceedings (up to $1.2 million) is only that portion that is necessary to ensure the continued operation of the Applicants’ business in the ordinary course for the next 10 days.

[42] The rest of the DIP Loan is made up of US$500,000 that will be loaned by the Applicants to Salus International to fund the immediate operational needs of Salus Bioceutical. The Applicants contend that these proceeds are immediately necessary to ensure Salus Bioceutical’s continued operations and will provide urgently required working capital to be used to pay for employee salaries, supplies, and raw goods for processing.

[43] It is a condition precedent to the first advance under the DIP Loan that all head office staff be terminated with the exception of those employee(s) who are retained with the DIP Lenders’ consent on such terms as the DIP Lenders’ consent to. The DIP Loan is subject to other customary covenants, conditions precedent, and representations and warranties made by the Applicants.

[44] It is proposed that KSV Restructuring Inc. will act as Monitor in these CCAA Proceedings (in such capacity, the “Proposed Monitor”).

ISSUES

[45] The issue to be considered on this application is whether to grant the proposed form of Initial Order, specifically whether:

(a) each of the Applicants is a “debtor company” to which the CCAA applies;

(b) the Stay of Proceedings should be granted in favour of the Applicants;

(c) the Stay of Proceedings should be extended to the Non-Applicant Stay Parties;

(d) the Court should approve the proposed DIP Loan and grant the DIP Lenders’ Charge (as defined below);

(e) the Administration Charge (as defined below) should be granted;

(f) the Directors’ Charge (as defined below) should be granted;

(g) the Applicants should be entitled to make certain pre-filing payments with the consent of the Monitor and the DIP Lenders; and

(h) MPXI should be relieved of any obligation to call and hold its annual general meeting of shareholders (the “AGM”) until further Order of this Court.

ANALYSIS AND LAW

[46] The CCAA applies in respect of a “debtor company or affiliated debtor companies” whose liabilities exceed $5 million.

[47] The Applicants collectively have over $5 million in debt. As of July 21, 2022, MPXI had indebtedness of approximately US$19,281,000 pursuant to the Debentures, and this debt is guaranteed by each of the other Applicants.

[48] I am satisfied that each of the Applicants is insolvent and is a “debtor company” as defined in the CCAA and that the CCAA applies to the Applicants.

[49] The Applicants contend that they require the Stay of Proceedings to prevent potential enforcement action by certain contractual counterparties.

[50] The Applicants submit that granting the Stay of Proceedings is in the best interests of the Applicants and their stakeholders, meets the statutory requirements, and is appropriate.

[51] I accept this submission.

[52] This Court has authority to extend the Stay of Proceedings to the Non-Applicant Stay Parties pursuant to s. 11 and 11.02(1) of the CCAA, which allow the court to make an initial order on any terms that the court may impose. In doing so, courts have looked at factors including whether the subsidiaries of the CCAA applicants had guaranteed the applicants’ secured loans; whether the non-applicants were deeply integrated into the applicants’ business operations; and whether the claims against the non-applicants are derivative of the primary liability of the applicants. (See: Lydian International Limited (Re), 2019 ONSC 7473; Sino-Forest Corporation (Re), 2012 ONSC 2063 at paras 5, 18, and 31; Canwest Global Communications Corp. (Re), 2009 ONSC 55114, [2009] OJ No 4286 (Ont. Sup. Ct. J.) (Commercial List) (Canwest Global) at paras 28-29; and Target, supra at paras 49-50).

[53] In this case, I am satisfied that these factors weigh in favour of extending the Stay of Proceedings to the Non-Applicant Stay Parties. Many of the Non-Applicant Stay Parties are guarantors for the Debentures, the primary debt of the Applicants. Further, the Non-Applicant Stay Parties are highly integrated into the business of the Company, and are all either wholly-owned or controlled by the ultimate parent company, MPXI. In addition, an extension of the stay to the Non-Applicant Stay Parties will prevent uncoordinated realization and enforcement attempts from being made in different jurisdictions, and thereby prevent immediate loss of value for the Applicants’ stakeholders. Therefore, in my view, it is reasonable to extend the Stay of Proceedings to the Non-Applicant Stay Parties.

[54] The Applicants intend to seek approval of a sales and investment solicitation process (the “SISP”) at the Comeback Hearing. The extension of the Stay of Proceedings to the Non-Applicant Stay Parties, which the Applicants believe hold material value, is required in order to give comfort to potential bidders in the SISP that enforcement actions against the Non-Applicant Stay Parties will be stayed and that value in these entities will be preserved during the period in which the SISP is conducted. Without the benefit of the Stay of Proceedings, the Applicants’ ability to market and sell their interests in the Non-Applicant Stay Parties and their respective assets would be compromised given the lack of stability that would exist.

[55] Subsection 11.2(5) requires that this Court be satisfied, after considering all of the facts and circumstances in the case before it, that the interim financing sought to be approved is “reasonably necessary” for continued operations in such circumstances.

[56] The Applicants submit that the DIP Loan is limited to what is strictly necessary for the continued operations of the Applicants until the Comeback Hearing; the requirement in subsection 11.2(5) is satisfied. Much of the total DIP Loan must be used during the 10 days before the Comeback Hearing. These amounts have been carefully scrutinized by the Proposed Monitor and the DIP Lenders, each of which agree that these amounts are required.

[57] The DIP Lenders’ Charge will not secure obligations incurred prior to the CCAA Proceedings, and the amount proposed to be funded is limited to the amount necessary to continue ordinary course operations prior to the Comeback Hearing. The Applicants submit the DIP Lenders’ Charge sought on this application is only for the amount to be accrued in the 10-day period preceding the Comeback Hearing.

[58] The Applicants submit that the following factors support approval of the DIP Loan and the DIP Lenders’ Charge:

(a) the Applicants are facing an urgent liquidity crisis. The Company will be unable to fund its next payroll or meet its commitments to its suppliers. The only way in which these obligations can be met is through the proposed DIP Loan. Any loss of important contracts or employees would be devastating to the Applicants’ business;

(b) the proposed DIP Loan is necessary to maintain the ongoing business and operations of the Applicants;

(c) the proposed DIP Loan will preserve the value and going concern operations of the Company’s business by ensuring the continued operations of the key business segments, which is in the best interests of the Applicants and their stakeholders;

(d) the DIP Lenders require the DIP Lenders’ Charge to provide the DIP Loan;

(e) the amount of the proposed DIP Loan is appropriate having regard to the Applicants’ cash-flow statement and the amount that is proposed to be funded prior to the Comeback Hearing is only the portion necessary to keep the Applicants operating in the ordinary course of business during that time;

(f) the cash flow projections demonstrate that debtor-in-possession financing is urgently required to provide the Applicants with the required liquidity for continued business operations in the ordinary course;

(g) the Proposed Monitor believes the economic terms of the DIP Loan are consistent with comparable CCAA proceedings; and

(h) the Proposed Monitor is supportive of the proposed DIP Loan and creditors of the Applicants will not be prejudiced as a result of its approval.

[59] The Applicants submit that approval of the proposed DIP Loan and the DIP Lenders’ Charge is appropriate in the circumstances, consistent with the terms of the CCAA, reasonably necessary in order to enable the continued operation of the Applicants’ business in the ordinary course, and in the best interests of the Applicants and their stakeholders – including the employees of the Applicants who are intended to be paid in the ordinary course from the proposed DIP Loan.

[60] I am satisfied that the DIP Loan and the DIP Lenders’ Charge are appropriate and they are approved.

[61] The Applicants also seek an Administration Charge in the amount of $300,000 (the “Administration Charge”) to secure the professional fees and disbursements of the Proposed Monitor, along with its counsel and the Applicants’ counsel, incurred prior to, on, or subsequent to the date of the Initial Order, incurred at their standard rates and charges.

[62] Section 11.52 of the CCAA expressly provides the Court with the jurisdiction to grant an administration charge.

[63] The Applicants submit that it is appropriate for this Court to exercise its jurisdiction and grant the Administration Charge, given that:

(a) the Applicants’ business is highly regulated and subject to numerous statutory and regulatory restrictions and requirements;

(b) the beneficiaries of the Administration Charge have the requisite knowledge with respect to those regulations and have, and will continue to, contribute to these CCAA Proceedings and assist the Applicants with their business;

(c) each proposed beneficiary of the Administration Charge is performing distinct functions and there is no duplication of roles;

(d) the proposed beneficiaries of the Administration Charge have no retainers, either because none was ever provided or the small retainers have been exhausted;

(e) no amounts from the initial advance under the DIP Loan will be used to pay the proposed beneficiaries of the Administration Charge;

(f) the quantum of the proposed Administration Charge is fair and reasonable;

(g) the proposed DIP Lenders support the Administration Charge; and

(h) the Proposed Monitor is supportive of the Administration Charge.

[64] I am satisfied that the Administrative Charge should be granted.

[65] The Applicants are seeking a Directors’ Charge in the amount of $145,000 (the “Directors’ Charge”) to secure the indemnity of their directors and officers for liabilities they may incur during the CCAA Proceedings.

[66] Section 11.51 of the CCAA affords the Court the jurisdiction to grant the Directors’ Charge. This Court has held that the purpose of such a charge is to keep the directors and officers in place during the restructuring by providing them with protections against liabilities that could be incurred during the restructuring.

[67] The Applicants submit it is appropriate in these circumstances for this Court to exercise its jurisdiction and grant the Directors’ Charge, given that:

(a) the directors and officers have indicated their continued service and involvement in these CCAA Proceedings is conditional upon the granting of the Directors’ Charge;

(b) applicable insurance policies available to the Directors and Officers may provide insufficient coverage, and is contemplated to be cancelled in any event in order to conserve cash;

(c) the Directors’ Charge applies only to the extent that the directors and officers do not have coverage under another directors and officers’ insurance policy;

(d) the Directors’ Charge would only cover obligations and liabilities that the Directors and Officers may incur after the commencement of the CCAA Proceedings and does not cover wilful misconduct or gross negligence;

(e) the Applicants require the active and committed involvement of certain directors and officers in order to continue business operations in the ordinary course;

(f) the amount of the Directors’ Charge is reasonable in the circumstances and is limited to the potential exposure during the initial 10-day period; and

(g) the Proposed Monitor is supportive of the Directors’ Charge.

[68] I am satisfied that the Directors’ Charge should be granted.

[69] To preserve normal course business operations, the Applicants are seeking authorization in the Initial Order to make certain pre-filing payments, including payments for pre-filing goods or services supplied to the Applicants if, with the consent of the Proposed Monitor and the DIP Lenders, such expenses were incurred in the ordinary course of business and consistent with existing policies and procedures.

[70] The Applicants submit that they require the continued supply of integral goods and services from their key vendors and service providers during these CCAA proceedings to maintain ordinary course operations. The Applicants’ ability to operate their business in the normal course is dependent on their ability to obtain an uninterrupted supply of goods and services. The Applicants will require the consent of the Proposed Monitor and the DIP Lenders in connection with any payments on account of pre-filing obligations. Both the Proposed Monitor and the DIP Lenders are supportive of the relief. In these circumstances, I am satisfied that this specific relief is appropriate in the circumstances.

[71] MPXI’s AGM was recently rescheduled to July 29, 2022, which is the last date that MPXI is permitted to hold the AGM under applicable corporate and securities laws. I am satisfied it is not in the best interests of the restructuring for the Applicants to hold the AGM as scheduled.

[72] This Court has the jurisdiction to order that an annual meeting need not be called until further order of the Court, and Courts have frequently exercised their jurisdiction under the CCAA to permit public debtor companies to postpone their annual meeting pending further order of the Court.

[73] The Applicants submit that it would be an unnecessary distraction and unwarranted expense for MPXI to hold an AGM in the circumstances where it is insolvent and the equity value of MPXI is suspect at best. (see: Sears Canada Inc. et al, Initial Order, Court File No. CV-17-11846-00CL, July 22, 2017 at para 54; Canwest Global, supra note 56; Cline Mining Corporation (Re), 2014 ONSC 6998 (Cline Mining)).

[74] I am satisfied that the postponement of the AGM will not prejudice any stakeholder and it is just and appropriate to allow for the postponement of MPXI’s AGM.

DISPOSITION

[75] In my view, it is appropriate to grant the Initial Order, which has been signed.

Chief Justice G.B. Morawetz

Date: August 3, 2022