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Stalking horses & break fees

In Re: Nortel Networks Corp. the Ontario Superior Court of Justice considered an application for court approval of the Bidding Procedures pertaining to the sale of Nortel’s “Layer 4-7” business, as well as approval of a “Stalking Horse” bidding process.

Prior to filing for protection under the CCAA, Nortel decided that the Layer 4-7 business should be sold. Shortly after filing, Nortel agreed to enter into an Asset Purchase Agreement with Radware for the purchase of the Layer 4-7 business (the “Purchase Agreement”).

Canada, Ontario, Insolvency & Restructuring, Litigation, Dentons, Bankruptcy, Debtor, Stakeholder (corporate), Companies' Creditors Arrangement Act 1933 (Canada), Ontario Superior Court of Justice
The “hardship fund” in CCAA proceedings

In Re EarthFirst Canada Inc., Justice Romaine had to consider establishing a “hardship fund” that would be used to allow EarthFirst Canada Inc. (“EarthFirst”) to pay pre-filing obligations owing to certain suppliers and contractors operating in a remote community where EarthFirst is developing a wind farm project.

Canada, Energy & Natural Resources, Insolvency & Restructuring, Litigation, Dentons, Bankruptcy, General contractor, Renewable energy, Option (finance), Debt, Supply chain, Wind power, Wind farm, Precondition
Supplier's rights under S. 81.1 of the Bankruptcy and Insolvency Act expanded

Section 81.1 of the Bankruptcy and Insolvency Act (“BIA”) grants a temporary super priority to suppliers who provided goods to a bankrupt purchaser or where a receiver has been appointed in relation to the purchaser. The section requires the supplier to provide a written demand to the purchaser and allows the supplier to repossess the goods within thirty days of the date of the delivery of goods.

Canada, Insolvency & Restructuring, Dentons, Bankruptcy, Debtor, Unsecured debt, Secured creditor, Unsecured creditor, Goldman Sachs, Bankruptcy and Insolvency Act 1985 (Canada)
Debtor in possession charge in priority to Canada Revenue Agency’s deemed trust

TrustIn Canada (Deputy Attorney General) v. Temple City Housing Inc., the Alberta Court of Appeal had to consider an application for leave to appeal a provision in a Companies Creditors Arrangement Act (Canada) (“CCAA”) order granting a DIP lender a charge in priority over the claims of CRA. The claims of CRA consisted of deemed trust claims arising under sections 224(1.2), 227(4) and 227(4.1) of the Income Tax Act (Canada).

Canada, Alberta, Banking, Insolvency & Restructuring, Litigation, Dentons, Tax deduction, Involuntary dismissal, Debtor in possession, Civil Rights Act 1964 (USA), Constitutional amendment, Court of Appeal of Alberta
The importance of registering name changes

In Royal Bank of Canada v. Head West Energy Inc., the Court of Appeal considered the priority of two security interest registrations against the same collateral, namely industrial camp trailers, and the obligations, pursuant to the Personal Property Security Act, R.S.A. 2000, c. P-7 (“PPSA”) of a security holder to amend its registration to reflect a name change when the security holder has knowledge of that name change.

Canada, Insolvency & Restructuring, Litigation, Dentons, Debtor, Collateral (finance), Interest, Voting, Wells Fargo, Royal Bank of Canada, Personal Property Security Act 1990 (Canada)