Court File and Parties

Court File No.: CV-23-00694493-00CL Date: 2023-05-12 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: THE PLAN OF COMPROMISE OR ARRANGEMENT OF BBB CANADA LTD.

Before: Chief Justice G.B. Morawetz

Counsel: Shawn Irving and Emily Paplawski, for BBB Canada Ltd. and Bed Bath & Beyond Inc. Jeffrey Levine, for Sixth Street Specialty Lending Inc. Linda Galessiere, for Riocan Real Estate Investment Trust, CrossIron Mills Holdings, SmartCentres Real Estate Investment Trust, CentreCorp Management Services Limited, Royop Development Limited, 1699259 Ontario Limited and 2573268 Ontario Inc. Evan Cobb, Agent to Secured Lenders Steven Weisz and Shahrouz Hafez, for Canadian Tire Corporation Mike Shakra, for Alvarez & Marsal, Monitor Monique Sassi, for JB Consultant Kyle Plunkett, for DKB Capital (Purchaser) Krista BeBeau, for Harvard Developments Inc. Brendan Jones, for Sun Life Assurance Company, Heritage Greene Development Corporation, Skyline Retail Real Estate Holdings Inc. and Queensway 427 Centre Inc. Edmond Lamek, for CT REIT Corp. and Canadian Tire Properties Craig Firth, for Preston West Properties Ltd.

Heard and Determined: April 28, 2023

Endorsement

[1] At the conclusion of the hearing, the motion was granted with reasons to follow. These are the reasons.

[2] The Applicant, BBB Canada Ltd. (“Applicant”) brings this motion for an order:

(a) approving the transactions contemplated by the Omnibus Assignment and Assumption of Leases Agreement, dated April 21, 2023 (the “Canadian Tire Agreement”) among Bed Bath & Beyond Canada L.P. (“BBB LP”, and together with the Applicant, “BBB Canada”), Bed Bath & Beyond Inc. (“BBBI”), and Canadian Tire Corporation, Limited (“Canadian Tire”);

(b) approving the transactions contemplated by the Assignment and Assumption of Lease Agreement, dated April 21, 2023 (the “Winners Agreement”) between BBB LP, BBBI and Winners Merchants International L.P. (“Winners”);

(c) vesting BBB LP’s right, title and interest in and to certain Leases and the other purchased assets described in the Canadian Tire Agreement, the Winners Agreement, and the Omnibus Agreement free and clear of all Encumbrances other than permitted encumbrances identified in, or pursuant to, the Canadian Tire Agreement, Winners Agreement and the Omnibus Agreement;

(d) assigning the Collingwood Lease (as defined below) to Winners and assigning the Barrhaven Lease (as defined below) to DKB Capital, both pursuant to section 11.3 of the Companies’ Creditors Arrangement Act, R.S.C., 1985 c. C-‑36 (the “CCAA”); and

(e) extending the Stay Period (as defined below) to June 27, 2023.

[3] The motion was not opposed and the Monitor supported the requested relief.

[4] This endorsement should be read in conjunction with the endorsement in these proceedings reported at 2023 ONSC 2308, which approved certain transactions in these proceedings. Defined terms in that endorsement have the same meaning in this endorsement.

[5] Canadian Tire has agreed to pay to the Monitor, in trust, cash consideration in the amount of $2,080,000 allocated between the 12 Leases that are subject to the Canadian Tire Agreement.

[6] The Applicant contends that Canadian Tire Agreement is in the best interests of BBB Canada and its stakeholders and the consideration paid in respect of the transactions defined therein is fair and reasonable.

[7] The Winners Agreement relates to one Lease respect to a store in Collingwood, ON (the “Collingwood Lease”).

[8] Winners has agreed to pay the Monitor, in trust, cash consideration in the amount of $1,022,142.27 for the assignment of the Collingwood Lease.

[9] The Applicant contends that an assignment of the Collingwood Lease to Winners pursuant to section 11.3 of the CCAA will maximize the realizable value of BBB Canada’s estate for the benefit of its stakeholders.

[10] The landlord under the Collingwood Lease has advised BBB Canada that it will not oppose an assignment of the Collingwood Lease to Winners under s. 11.3 of the CCAA.

[11] The Applicant contends that consideration payable for the assignment of a lease of premises located in the Barrhaven Town Centre, Ottawa, ON (the “Barrhaven Lease”) falls under the defined monetary threshold in the Amended and Restated Initial Order (“ARIO”), but the landlord wishes to complete the assignment of the Barrhaven Lease under s. 11.3 of the CCAA.

[12] RVC and BBB Canada believe that the consideration offered by Canadian Tire for the above noted Leases is fair and reasonable in the circumstances. It represents the highest, nonoverlapping, executable offer received within the marketing process for the 12 Leases. The Monitor agrees with this assessment.

[13] RVC and BBB Canada believe that the consideration paid by Winners for the Collingwood Lease is fair and reasonable in the circumstances and it represents the highest, non-overlapping, executable offer received within the marketing process for the Collingwood Lease. The Monitor agrees with this assessment.

[14] Mr. Haddad in his supplementary affidavit sworn April 26, 2023, states that DKB Capital has covenanted to assume all of BBB LP’s obligations contained in the Barrhaven Lease from and after the closing date and has paid all consideration payable under the Second DKB Capital Agreement to the Monitor in trust. As noted above, the assignment of the Barrhaven Lease falls under the defined monetary threshold for approval in the ARIO.

[15] In assessing whether to provide its support for the Applicant’s request for the proposed Order approving the Assignment Agreements and the transactions contemplated therein, the Monitor has considered, among other factors, those enumerated under section 36 of the CCAA. Having regard to these non-exhaustive factors, the Monitor supports the Applicant’s request for the proposed Order given that:

(i) the Monitor is of the view that the Assignment Agreements provide an outcome with respect to the Assumed Leases that is superior and more beneficial to BBB Canada’s creditors to that which could be realized in a bankruptcy;

(ii) the Monitor understands that the Assumed Leases to be assigned in accordance with section 11.3 of the CCAA is expected to be assigned on an unopposed basis and in accordance with the requirements and restrictions of section 11.3 of the CCAA, including the payment of Cure Costs;

(iii) Canadian Tire, Winners and DKB Capital are established, entities and have covenanted that they have the ability to fulfill their obligations under the Assumed Leases;

[16] Based on the foregoing, I am satisfied that the Applicant has established that the Canadian Tire Agreement and the Winners Agreement should be approved and that the Collingwood Lease and the Barrhaven Lease should be assigned pursuant to s. 11.3 of the CCAA.

[17] The Applicant is seeking to extend the Stay Period up to and including June 27, 2023. The Applicants is not seeking any extension of the temporary stay granted in the Initial Order of all proceedings against BBBI arising out of or in connection with the BBBI Indemnities;

[18] The Applicant contends that the extension to the Stay Period is necessary and appropriate in the circumstances to allow BBB Canada and the Consultant to complete the final reconciliation and settlement of all amounts realized in the liquidation sale.

[19] I am satisfied that the record establishes that BBB Canada has acted, and continues to act, in good faith and with due diligence in pursuing these final steps in the wind down of its business.

[20] I also note that the Third Report of the Monitor includes a cash flow forecast demonstrating that, subject to the underlying assumptions contained therein, BBB Canada will have sufficient funds to continue its operations and fund these CCAA proceedings until June 27, 2023.

[21] The request to extend the Stay Period to June 27, 2023, is approved.

[22] The motion is granted and the orders reflecting the foregoing have been signed.

Chief Justice G.B. Morawetz Date: May 12, 2023