DS Commercial Inc. a.k.a. DS Commercial Inc. d/b/a/ Stealth Metal Recycling and Processing

Receivership

Page last updated: June 30, 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 March 12, 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 (the “Receiver”), without security, of: (i) the real property known municipally as 100 Mason Street in Chatham-Kent, Ontario (the "Included Real Property"); and (ii) all the other assets, undertakings and properties of DS Commercial Inc. a.k.a. DS Commercial Inc, d/b/a Stealth Metal Recycling and Processing (“Stealth Metal” or the "Company") acquired for, or used in relation to a business carried on by the Company, save and except for the real property known municipally as 1951 Brigden Side Road in St. Clair, Ontario (the "Excluded Real Property") and any personal property subject to a validly-perfected and enforceable security interest ranking in priority to that held by Triple M Metal LP (together with the Excluded Real Property, the "Excluded Property").

The Receivership Order was granted on application of Triple M Metal LP, by its general partner Triple M Metal Corp  (“Triple M”) and 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.

In accordance with the provisions of the BIA, a Notice and Statement of the Receiver (the “Notice”) has been sent to all known potential creditors of the Company. A copy of the Notice is posted on the “Notices” page of this website.


Status of File as of June 29, 2020

On June 11, 2020, DS Commercial Inc. – through the Receivership – effected the successful restructuring of its secured debt that was registered on title to the Real Property in favour of a private lender and Canada Revenue Agency. On June 16, 2020, the Receiver was discharged as receiver of the Real Property, which was returned to the care and control of DS Commercial Inc. The Receiver also received its full discharge, conditional on fulfilling residual matters under its administration. As at June 16, 2020, the Receiver does not have care, control or carriage of the business of DS Commercial Inc. All inquiries related to the ongoing business and activities of DS Commercial Inc. should be directed to DS Commercial Inc.  

Status of File as of June 16, 2020

On June 16, 2020, the Receiver filed its second report (the “Second Report”) with the Court to provide the Court with information concerning:

  1. The Receiver’s activities since the First Report;
  2. The Receiver’s remaining statutory duties related to its administration of the Receivership Proceeding (the “Remaining Duties”);
  3. The Receiver’s Borrowings;
  4. The Receiver’s statement of receipts and disbursements (the “Final R&D”);
  5. An accounting of the Refinancing Funds (as defined in the Second Report) received from DS Commercial;
  6. The professional fees and disbursements of the Receiver and its legal counsel that may be subject to taxation pursuant to the May 28 order; and
  7. The discharge of the Receiver;

and to seek an order of the Court (the “Discharge Order”):

  1. Approving the Second Report and the activities of the Receiver therein;
  2. Approving the Receiver's Final R&D;
  3. Approving the fees of the Receiver and its legal counsel to complete the Receiver’s Remaining Duties (as defined in the Second Report);
  4. Authorizing and directing the Receiver to pay the Outstanding Professional Fees and the
  5. Remaining Professional Fees (as described in the Second Report);
  6. Authorizing the Receiver to release the balance of the Refinancing Funds to DS Commercial, after paying amounts owed to Triple M and CRA pursuant to the Administrative Order, the Outstanding Professional Fees and the Remaining Professional Fees; and
  7. Subject to the Receiver completing its Remaining Duties, discharging PwC as Receiver.

The motion will be heard on June 16, 2020.

Status of File as of June 11, 2020

On June 11, 2020, the Court issued an order (the “Administrative Order”), which among other things,

1.    Authorized and directed the Receiver to distribute the funds irrevocably paid by the Company to the Receiver in trust (the “Trust Funds”) as follows:

a.    $2,216.72, plus applicable penalties and interest to the date of payment, to Canada Revenue Agency (“CRA”), being the outstanding Source Deductions, if any;

b.    $365,000.00 to Triple M, being the amounts secured by the Receiver’s Borrowings Charge;

c.     $1,495,804.12 to Triple M, being the amounts secured by the Triple M Charge (as defined herein), as detailed in a payout letter provided by Triple M pursuant to the endorsement of Justice Conway dated May 28, 2020; and

d.    $172,878.43, plus applicable penalties and interest to the date of payment, to CRA, being the amounts secured by the CRA Lien (as defined herein).

2.    Ordered that following the payments set out in paragraph 1, the Receiver shall make a motion to the Court for its discharge and final approval of fees and disbursements.

Status of File as of May 19, 2020

On May 19, 2020, as part of a motion filed by the Receiver on the same day, the Receiver filed its First Report (the “First Report”) with the Court to provide the Court with the information with respect to:

  1. Background information on the Company;
  2. The Receiver’s activities since the date of appointment to the date of this First Report;
  3. Marketing and sale considerations;
  4. The agreement of purchase and sale dated May 18, 2020, between the Receiver and Triple M in respect of certain purchased assets (the “Sale Agreement”) and the Transaction (as defined in the First Report);
  5. The Receiver's view of the Sale Agreement and the Transaction;
  6. A legal opinion on the validity and enforceability of the security held by Triple M;
  7. The Receiver’s remaining statutory duties related to its administration of the receivership (the “Remaining Duties”);
  8. The Receiver’s Borrowings (as defined in the Receivership Order);
  9. The Receiver’s statement of receipts and disbursements (the “R&D”) from the date of appointment to May 15, 2020 and the Receiver’s estimated Remaining Obligations (as defined in the First Report);
  10. The professional fees and disbursements of the Receiver and its legal counsel;
  11. Priority Claims (as defined in the First Report); and
  12. The discharge of the Receiver.

and to seek an order of the Court (the “Approval and Vesting Order”):

  1. Approving the Sale Agreement and the proposed Transaction;
  2. Vesting the right title and interest , of the Company in the Purchased Assets to Triple M; and
  3. Providing vacant possession to Triple M.

and to seek an order of the court (the “Discharge and Administrative Order”) ,:

  1. Approving an increase of the Receiver’s borrowings and the amount of the Receiver’s Borrowing Charge (as defined in the Receivership Order) by $165,000 to $365,000;
  2. Sealing of the confidential appendix “A” of the First Report until further order of this Court;
  3. Approving the First Report and the activities of the Receiver’s;
  4. Approving the Receiver's R&D and the Receiver’s Remaining Obligations (as defined in the First Report);
  5. Approving fees and disbursements of the Receiver and its legal counsel, including an accrual of fees to the completion of the Receiver’s mandate;
  6. Authorizing and directing the Receiver to cause DS Commercial to make an assignment in bankruptcy;
  7. Declaring any Excluded Property existing at the Included Real Property to be abandoned as at 5:00 p.m. on June 4, 2020, and authorize the Receiver or Triple M to dispose of such abandoned property (the “Abandoned Property”); and
  8. Approve the application of the net proceeds from the disposal of the Abandoned Property and any additional funds collected by the Receiver to the repayment of amounts borrowed by the Receiver from Triple M; and
  9. Subject to the Receiver completing its Remaining Duties and filing a certificate with the Court confirming that the Receiver has completed all of the steps necessary to conclude the receivership (the “Discharge Certificate”), discharging PwC as Receiver.

The motion will be heard on May 28, 2020.

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Tammy Muradova

Consulting & Deals, PwC Canada

Tel: +1 416 941 8383

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