The Clover on Yonge Inc., The Clover on Yonge Limited Partnership, 480 Yonge Street Inc. and 480 Yonge Street Limited Partnership (Cresford Group)

Receivership

Page last updated: August 11, 2020

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 June 22, 2020, the Court made an order to commence proceedings under the Companies' Creditors Arrangement Act ("CCAA") in respect of The Clover on Yonge Inc. and The Clover on Yonge Limited Partnership.  Further information on those proceedings will be posted on the following website: www.pwc.com/ca/clover-ccaa.

On March 27, 2020, pursuant to an order (the “Receivership Order”) of the Ontario Superior Court of Justice (Commercial List) (the “Court”), PricewaterhouseCoopers Inc., LIT (“PwC”) was appointed as receiver and manager (the “Receiver”), without security, of all of the assets, undertakings and properties (the “Property”) of The Clover on Yonge Inc., The Clover on Yonge Limited Partnership, 480 Yonge Street Inc. and 480 Yonge Street Limited Partnership (collectively the “Companies”) acquired for, or used in relation to a business carried on by the Companies, or either of them, including, without limitation, the real property known municipally as (i) 587 – 599 Yonge Street, Toronto, ON, 2 & 4 Dundonald Street, Toronto, ON and 7 & 9 Gloucester Street, Toronto, Ontario (“Clover”); and (ii) 480-494 Yonge Street, Toronto, ON (“Halo” and collectively with The Clover “Real Property”), pursuant to section 243(1) of the Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, as amended (the “BIA”) and section 101 of the Courts of Justice Act, R.S.O. 1990, c. C.43, as amended. The Receivership Order was granted pursuant to an application made by bcIMC Construction Fund Corporation and bcIMC Specialty Fund Corporation (collectively, the “Applicants”).

In accordance with the provisions of the BIA, a Notice and Statement of the Receiver (the “Notice”) will be sent to all known creditors of the Companies. A copy of the Notice will be posted on the “Notices” page of this website.

Please note that PwC has only been appointed as Receiver over the companies responsible for the 33 Yorkville, Clover and Halo projects.  Other Cresford Group entities are not included in this receivership. If your query relates to any other of the Cresford Group projects or entities, please contact your normal Cresford contacts.

To view information on 33 Yorkville project, please click here.


Status of File as of July 22, 2020

On July 22, 2020, the Court issued the Halo Receiver Borrowings Increase Order which among other things

  1. Approved the Third Report and the activities of the Receiver as described therein; and
  2. Approved the Borrowing Limit from $20,200,000 to $24,500,000.

Status of File as of July 20, 2020

On July 17, 2002, the Receiver filed its Third Report (the “Third Report”) with the Court, to provide the Court with the information on:

  1. The activities of the Receiver since the Second Report, May 29, 2020 Supplementary Report of the Receiver and June 2, 2020 Supplementary Report of the Receiver;
  2. A statement of receipts and disbursements for the Halo project since the date of the Receivership Order;
  3. The status of ongoing construction for the Halo project; and
  4. A summary of the anticipated funding requirements of the Receiver in respect of the Halo project, giving rise to the request to increase the Borrowing Limit.

On the same date, the Receiver filed a motion for an order (the “Halo Receiver Borrowings Increase Order”) to, among other things

  1. Increase the principal amount the Receiver is authorized to borrow as secured by the Receiver’s Borrowing Charge from $20,200,000 to $24,500,000 for Halo (the “Borrowing Limit”);
  2. Approve the Third Report and the activities of the Receiver described therein.

The motion will be heard on July 22, 2020.

Status of File as of June 19, 2020

On June 19, 2020, The Clover on Yonge Inc. and The Clover on Yonge Limited Partnership (collectively, the “Clover CCAA Applicants”), filed a motion for an order (the “Initial Order”) declaring that the Clover CCAA Applicants are companies to which the Companies’ Creditors Arrangement Act, R.S.C.1985, c.C-36, as amended (“CCAA”) applies, and creating a separate Court file number for the CCAA proceedings of the Clover CCAA Applicants that is distinct from the receivership proceedings.

The motion will be heard on June 22, 2020.

Status of File as of June 11, 2020

On June 11, 2020, the Court issued the SISP Approval Order, which, among other things:

  1. Approved the Halo SISP (as summarized in Schedule A to the SISP Approval Order). Further information relating to the Halo SISP can be found on the “SISP” page of this website. 
  2. Dismissed the motion to approve the SISP in respect of Clover.  The Clover companies (The Clover on Yonge Inc. and The Clover on Yonge Limited Partnership) or anyone acting on their behalf had the right to pay out all amounts owing from Clover to the Applicants, which payment occurred on June 11, 2020; and
  3. Approved the First Report, the Supplementary Report, the Second Report, the May 29, 2020 Supplementary Report, the June 2, 2020 Supplementary Report, and the activities of the Receiver as described therein.

Status of File as of June 3, 2020

On June 2, 2020, the Receiver filed its Second Supplementary Report to its Second Report (the “June 2, 2020 Supplementary Report’) to provide the Court with an update on certain communications that have been sent over the past week to Unit Purchasers (defined in the June 2, 2020 Supplementary Report) and the Receiver’s response and proposed action in relation thereto and address comments in the Affidavit of Jason Chiu, sworn June 1, 2020 (the “Record of OTB Capital Inc.”)  in respect of the time frame for the SISPs.

The June 2, 2020 Supplementary Report should be read in conjunction with the May 29, 2020 Supplementary Report and the Second Report.

Status of File as of June 1, 2020

On May 29, 2020, the Receiver filed the Supplementary Report to its Second Report (the “May 29, 2020 Supplementary Report”) with the Court to provide the Court with further details on the Stalking Horse Agreements. The Second Supplementary Report should be read in conjunction with the Second Report.

Status of File as of May 26, 2020

On May 25, 2020, the Receiver filed its Second Report (the “Second Report”) with the Court to provide the Court with the information with respect to:

  1. The Receiver’s activities since the First Report, to the date of this Second Report;
  2. The Receiver’s motion to request the Approval a sale and investor solicitation process for each, the Clover project (the “Clover SISP”) and Halo project (the “Halo SISP” and collectively with Clover SISP, the “SISPs”); and
  3. The Stalking Horse Agreements (defined below).

The motion for an order to approve the SISPs will be heard on June 4, 2020 and the Receiver will seek an order (the “Sale Approval Order”), to among other things: 

  1. Approve the Clover SISP attached to the draft SISP Approval Order as Schedule “A” and Halo SISP attached to the draft SISP Approval Order as Schedule “B”;;
  2. Authorize the Receiver and the Broker (as defined in the SISPs) to implement the SISPs and perform their respective obligations, including all things that are reasonably necessary or desirable to carry out and give full effect to the SISPs;
  3. Authorize the Receiver, nunc pro tunc, to execute the stalking horse agreements of purchase and sale dated May 25, 2020, in the form attached as Appendices “B” and “C” to the Second Report (the “Stalking Horse Agreements”), approving the Stalking Horse Agreements as the Stalking Horse Bids and approving the payment of the Break Fee as defined and provided for in the Stalking Horse Agreements;
  4. Declare that neither the Receiver nor the Broker shall have any liability whatsoever to any person or party for any act or omission related to the SISPs, except to the extent such act or omission is the result of gross negligence or wilful misconduct of the Receiver or Broker;
  5. Declare that, to the extent desirable in furtherance of the SISPs, the Receiver may disclose personal information to prospective purchasers or bidders and to their advisors, and in so doing will not be in violation of the Personal Information Protection and Electronic Documents Act; and
  6. Approve the First Report of the Receiver dated May 11, 2020, the Supplemental Report to the First Report dated May 14, 2020, the Second Report of the Receiver dated May 25, 2020, and the Supplementary Report to the Second Report, to be filed prior to the June 4, 2020 hearing.

Status of File as of May 19, 2020

On May 15, 2020, the Court issued the Receiver’s Borrowing Order, which among other things:

  1. Approved the increase of the Receiver’s Borrowing Charge from $16,000,000 to $43,300,000 for the Clover project;
  2. Approved the increase of the Receiver’s Borrowing Charge from $13,000,000 to $20,200,000 for the Halo project;
  3. Allowed some flexibility to allocate a limited amount, up to $6,000,000 from one project to the other; and
  4. Approved the increase of the interest rate for additional borrowings from 5% to 8% plus a 1% advance fee for all additional advances in excess of the originally approved amounts.

Status of File as of May 15, 2020

On May 14, 2020, the Receiver filed a supplementary motion for the Receiver’s Borrowing Order and a Supplementary Report to the First Report ( the “Supplementary Report”) to be read in conjunction with the Receiver’s First Report, the purpose of which was  to provide further details to the Court on the status of construction activities at the Halo and Clover projects, and specifically the importance of receiving additional funding for the Companies.

The motion will be heard on May 15, 2020.

Status of File as of May 13, 2020

The motion for the Receiver’s Borrowing Order has been rescheduled to May 15, 2020.

Status of File as of May 12, 2020

On May 11, 2020, the Receiver filed a motion with the Court for an order (the “Receiver’s Borrowing Order”) to, among other things, increase the Receiver’s Borrowings Charge (as defined in paragraph 22 of the Receivership Order) from (i) $16,000,000 to $43,300,000 for Clover, and (ii) from $13,000,000 to $20,200,000 for Halo, with some flexibility to allocate a limited amount from one project to the other, and in both cases, increasing the interest rate for additional borrowings from 5% to 8% plus a 1% advance fee for all additional advances in excess of the originally approved amounts.

On the same date, the Receiver filed its First Report (the “First Report”) with the Court to provide the Court with the information with respect to:

  1. The Receiver’s activities from the date of appointment to the date of the First Report;
  2. The receipts and disbursements for the receivership proceedings;
  3. An update on the Receiver’s intended course of action;
  4. The status of discussions with trade suppliers of the Companies; and
  5. The Receiver’s motion for the Receiver’s Borrowing Order.

The motion will be heard on May 14, 2020.

Status of File as of June 3, 2020

 

On June 2, 2020, the Receiver filed its Second Supplementary Report to its Second Report (the “June 2, 2020 Supplementary Report’) to provide the Court with an update on certain communications that have been sent over the past week to Unit Purchasers (defined in the June 2, 2020 Supplementary Report) and the Receiver’s response and proposed action in relation thereto and address comments in the Affidavit of Jason Chiu, sworn June 1, 2020 (the “Record of OTB Capital Inc.”)  in respect of the time frame for the SISPs.

 

The June 2, 2020 Supplementary Report should be read in conjunction with the May 29, 2020 Supplementary Report and the Second Report.

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Natalia Chtcherbakova

Consulting & Deals, PwC Canada

Tel: 416-687-8959

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