McDiarmid Lumber Ltd., Superior Truss Co. Ltd. and WW Doors Inc.

CCAA Filing

Page last updated: December 5, 2013

This page is for information purposes only and you should consult your professional adviser if you have any questions or are uncertain as to your rights or obligations.

On May 23, 2013, McDiarmid Lumber Ltd. (“McDiarmid”), Superior Truss Co. Ltd. (“Truss Co”) and WW Doors Inc. (“WWD” and collectively with McDiarmid and Truss Co, the “Applicants” or the “Companies”) applied for and received an order (the “Initial Order”) for protection pursuant to the Companies’ Creditors Arrangement Act (“CCAA”), R.S.C.1985, c.C-36, as amended, from the Court of Queen’s Bench of Manitoba, Winnipeg Centre, which includes, among other things, a stay of proceedings against the Companies, and the appointment of PricewaterhouseCoopers Inc. as monitor of the Applicants (the “Monitor”).

The Initial Order, also, among other things:

  1. granted a priority charge over the property of the Applicants, in the amount of $250,000 to secure the fees and disbursements of the Monitor, counsel to the Monitor and the Applicants’ counsel (the “Administration Charge”);
  2. granted a priority charge over the property, in the amount of $1.8 million, in order to protect the applicants’ directors and officers from certain potential liabilities (the “D&O Charge”);
  3. sealed confidential documentation; and
  4. set a return date of June 3, 2013 for the Applicants’ motion for approval of the sale of the Purchased Assets, as defined in the Sale Agreement between McDiarmid, Truss Co and McMunn & Yates Building Supplies Ltd., (detailed in the Proposed Monitor’s Report) (the “Transaction”).

In accordance with section 23.(1)(ii)(b) of the CCAA and the Initial Order, a notice was sent on May 24, 2013, to all known creditors of the Companies with amounts owed of more than $1,000.00.

509 KB Notice to the Creditors dated May 24, 2013
122 KB Creditors Over $1,000 Listing

Also on May 24, 2013 the Applicants’ counsel mailed a copy of the Applicants’ Notice of Motion returnable June 3, 2013, to all creditors owed more than $1,000.00, see copy below.

122 KB Applicants’ Notice of Motion returnable June 3, 2013

On May 29, 2013 the Monitor sent a notice relating to the Applicants’ Motion, returnable June 3, 2013, to all creditors owed more than $1,000.00.

122 KB Monitor’s Notice to Creditors with respect to the Applicants’ Motion, returnable June 3, 2013

 


Status of File as at December 4, 2013

On December 4, 2013, the Court granted an order:

  1. approving the sale of certain real property located in Yorkton, Saskatchewan to Shaftsbury Construction Co. Ltd. as purchaser (the “Purchaser”);
  2. approving the sale of the remaining RTM inventory owned by McDiarmid to the Purchaser;
  3. authorizing the Applicants to pay all or substantially all of the proceeds from the sale to Superior Builders Ltd. in reduction of McDiarmid’s indebtedness; and
  4. allowing for the continuance of the CCAA proceedings (without a further stay) and confirming that McDiarmid and/or the Monitor remain authorized to continue to collect on and/or otherwise pursue McDiarmid’s accounts receivable, claims and chooses inaction as may remain outstanding.

Status of File as at November 28, 2013

On November 28, 2013, the Monitor filed its Fifth Report with the Court to provide the Court with the Monitor’s recommendation with respect to the Applicants’ motion seeking approval of the sale of real property in Yorkton, Saskatchewan and the sale of remaining RTM inventory to a purchaser related to Superior Builders Ltd. (“Superior”).

In addition, the Fifth Report provides the Court with information in respect of:

  1. the Applicants’ business activities since the Fourth Report, including the ongoing operations and dealings with suppliers and employees;
  2. the activities of the Monitor since the date of the Fourth Report, including the completion of duties prescribed pursuant to the CCAA;
  3. the status of payments to Superior on account of the balance owed to it by the Applicants and the estimated shortfall to Superior on account of the indebtedness owed; and
  4. the amount of funds determined by the Monitor to be reasonably required through the completion of the Proceedings, having regard to the Applicants’ own cash flow requirements and any prior charges or encumbrances.

The motion will be heard on December 4, 2013.

Status of File as at November 15, 2013

On December 4, 2013, the Applicants will make a motion for an order:

  1. approving the sale of certain real property located in Yorkton, Saskatchewan to Shaftsbury Construction Co. Ltd. as purchaser (the “Purchaser”);
  2. approving the sale of the remaining RTM inventory owned by McDiarmid to the Purchaser;
  3. authorizing the Applicants to pay all or substantially all of the proceeds from the sale to Superior Builders Ltd. in reduction of McDiarmid’s indebtedness; and
  4. continuing the CCAA proceedings (without a further stay) and confirming that McDiarmid and/or the Monitor remain authorized to continue to collect on and/or otherwise pursue McDiarmid’s accounts receivable, claims and chooses inaction as may remain outstanding.

Status of File as at August 28, 2013

On June 3, 2013, the Monitor filed its Fourth Report with the Court to provide the Court with the Monitor’s recommendation with respect to the Applicants’ motion seeking an extension of the Stay Period to December 7, 2013 and amending and enhancing the Monitor’s powers as detailed in the Applicants’ Motion Record. The motion will be heard on August 28, 2013.

The motion was heard on August 28, 2013 and the aforementioned order extending the stay period to December 7, 2013 and amending and enhancing the Monitor’s powers as detailed in the order was granted by the Court.

Status of File as at August 23, 2013

On June 3, 2013, the Monitor filed its Fourth Report with the Court to provide the Court with the Monitor’s recommendation with respect to the Applicants’ motion seeking an extension of the Stay Period to December 7, 2013 and amending and enhancing the Monitor’s powers as detailed in the Applicants’ Motion Record. The motion will be heard on August 28, 2013.

Status of File as of August 21, 2013

On August 28, 2013, the Applicants will make a motion for an order:

  1. Extending the Stay Period to December 7, 2013; and
  2. Amending and enhancing the Monitor’s powers for the purpose of:
    1. discharging such of their obligations under the Sale Agreement dated May 17, 2013, that have yet to be completed;
    2. pursuing, recovering, realizing upon and/or otherwise dealing with any and all remaining assets of the Applicants;
    3. preparing and filing various returns, remittances, statements, records or other documentation on behalf of the Applicants; and
    4. performing any and all other necessary administrative and/or management functions.

Status of File as of June 25, 2013

On June 25, 2013, the Court issued an order which states that nothwithstanding paragraph 10 of the Initial Order, but subject to retaining such reserves as the Monitor may from time-to-time deem appropriate, the Applicants shall be entitled to pay Superior any interest, costs, and other payables due and owing to Superior.

On the same day, the Court issued an order granting Paul Lafreniere leave to commence a legal proceeding against McDiarmid by filing a Statement of Claim in the Court of Queen’s Bench of Alberta.

Status of File as of June 21, 2013

On June 20, 2013, the Monitor filed its Third Report to provide the Court with the Monitor’s recommendation with respect to the Applicants’ motion seeking authorization to pay down their indebtedness to Superior Builders Limited (“Superior”) and to provide the Court with information in respect of:

  1. the Applicants’ business activities since the date of the Second Report, including ongoing operations, dealings with suppliers and employees;
  2. the activities of the Monitor since the date of the Second Report, including the completion of duties prescribed pursuant to the CCAA;
  3. the payment to the Canadian Imperial Bank of Commerce (“CIBC”) on account of the balance owed to it by the Applicants;
  4. the payment by Superior to CIBC of the final balance then owed to it by the Applicants, and the related assignment of the underlying indebtedness and all of the CIBC’s security; and
  5. details of the amount of funds determined by the Monitor to be reasonably required having regard to the Applicants’ own cash flow requirements and any prior charges or encumbrances.

Status of File as of June 19, 2013

On June 25, 2013, the Applicants will make a motion for an order authorizing the Applicants to pay down their indebtedness to Superior Builders Limited in such amounts as may be determined to be reasonable by the Monitor.

Status of File as of June 18, 2013

On June 18, 2013, the Court issued an order

  1. extending the Stay Period to August 30, 2013; and
  2. approving the sale of the unfinished condominium project located at 334 Morrison Drive, Yorkton, Saskatchewan to SveinCo Developments for $650,000.

Status of File as of June 13, 2013

On June 13, 2013, the Monitor filed its second report with the Court (the “Monitor’s Second Report”), to provide the Court with information in respect of:

  1. The closing of the previously reported proposed transaction (the “Transaction”) to sell a substantial portion of the Property (the “Purchased Assets”) owned by McDiarmid and TrussCo (the “Vendors”) to McMunn & Yates Building Supples Ltd. (“McMunn or the “Purchaser”);
  2. the Applicants’ business activities since the date of the First Report, including their dealings with suppliers, employees, customers and other stakeholders;
  3. the activities of the Monitor since the date of the First Report, including the completion of the duties prescribed pursuant to the CCAA;
  4. a review of the receipts and disbursements of the Companies since the commencement of the Proceedings;
  5. the Monitor’s updated calculation of the estimated amounts available to the Applicants’ creditors given the completion of the Transaction, taking into account assumptions regarding the liquidation of the remainder of the Property;
  6. the status of the distribution of funds to CIBC arising from the Transaction;

    and to provide the Court with the Monitor’s recommendations with respect to the Applicants’ motions seeking the following, inter alia:

  7. an extension of the Stay period to August 30, 2013; and
  8. authorization for the Applicants to pursue the sale of certain property in Yorkton, Saskatchewan.

The Applicant’s motion will be heard on June 18, 2013 at 9 a.m. (CST).

Status of File as at June 3, 2013

On June 3, 2013, the Court issued an order (the “Approval and Vesting Order”) which, among other things:

  1. approved the Transaction and APA (both as defined in the Monitor’s First Report) between McMunn & Yates Building Supplies Ltd. (“McMunn”) and the Vendors and sealing the unredacted version of the APA;
  2. vesting in McMunn all of the Vendors’ right, title and interest in and to the Purchased Assets (as defined in the APA), free and clear of and from any and all security interests;
  3. authorizing and directing the Applicants to distribute from the sale proceeds derived from the Transaction or from other amounts in their hands, amounts up to the amount of the indebtedness owed by the Applicants to CIBC, subject to maintaining reserves sufficient to support the Applicants operations during the CCAA proceedings and to satisfy obligations that may rank in priority to the Applicants’ indebtedness to CIBC; and
  4. sealing the Monitor’s Recovery Analysis and Confidential Appendices E (Summary of Liquidator Bids) and F (Summary of Going Concern Bids) of the Monitor’s First Report.

Status of File as of May 29, 2013

On May 29, 2013, the Monitor filed its first report with the Court (the “Monitor’s First Report”), to provide the Court with information in respect of:

  1. the Applicants’ business activities since the commencement of the CCAA proceedings, including their dealings with suppliers, employees, customers and other stakeholders;
  2. the activities of the Monitor since the commencement of the CCAA proceedings
  3. a detailed overview of the Sales Process;
  4. a proposed transaction (the “Transaction”) to sell a substantial proportion of the property  (the “Purchased Assets”) owned by McDiarmid and Trussco (the “Vendors”) to McMunn & Yates Building Supplies Ltd. (“McMunn” or the “Purchaser”);
  5. the Monitor’s views and conclusions with respect to the Transaction;
  6. the Monitor’s calculation of the estimated amounts available to the Applicants’ creditors in the event the Transaction is completed and, for illustrative purposes, in the event the remainder of the Applicants’ property were liquidated (the “Monitor’s Recovery Analysis”), which the Monitor will file with the Court as Confidential Appendix “B”;
  7. the review of the security held by the Canadian Imperial Bank of Commerce (“CIBC”) ;
  8. the proposed distribution to CIBC.

    and to provide the Court with the Monitor’s recommendations with respect to the Applicants’ motion seeking the granting of an order (the “Approval and Vesting Order”), inter alia:

  9. approving the Transaction and the asset purchase agreement (the “APA”) between McMunn and the Vendors and sealing the unredacted version of the APA, filed with the Court by the Applicants, until the Transaction closes;
  10. vesting in McMunn all of the Vendors’ right, title and interest in and to the Purchased Assets, free and clear of and from any and all security interests;
  11. authorizing and directing the Applicants to distribute from the sales proceeds derived from the Transaction or from other amounts in their hands, amounts up to the amount of the indebtedness owed by the Applicants to CIBC, subject to maintaining reserves sufficient to support the Applicants operations during the CCAA proceedings and to satisfy obligations that may rank in priority to the Applicants’ indebtedness to CIBC;
  12. sealing the Monitor’s Recovery Analysis, until the Transaction closes and the remainder of the Property has been realized on or, in the alternative, until a plan of compromise and arrangement has been accepted and implemented, pursuant to the provisions of the CCAA;
  13. sealing Confidential Appendices E (Summary of Liquidator Bids) and F (Summary of Going Concern Bids) of the Monitor’s First Report; and
  14. authorizing the Applicants to make Further Distributions to CIBC (as defined in the Monitor’s First Report), if any, subject to maintaining sufficient reserves to satisfy obligations that rank in priority to CIBC and to satisfy the Applicants ongoing obligations with respect to the proceeding.

The Applicant’s motion will be heard on June 3, 2013 at 9 a.m. (CST).


This Web site will be updated as information becomes available.

For more information, please contact: Tammy Muradova, Telephone: +1 416 941 8383 ext 14288, or via Email.