Monarch filed a Notice of Intention to Make a Proposal (“NOI“) pursuant to the provisions of the Bankruptcy and Insolvency Act (“BIA“) on October 22, 2015 and A. Farber & Partners Inc., a member of Farber Financial Group (“Farber“) was appointed as Proposal Trustee.
Monarch Books of Canada Limited (“Monarch” or the “Company“) is an Ontario incorporated company that has carried on business as a book distributor throughout Canada since 1985. Monarch’s Customers are both national and local retailers.
Monarch had two parts to its business. The first and larger part of Monarch’s business was acting as a distributor, under a distributorship agreement with Popular (“Distributorship Agreement”) for books that Monarch received on a consignment basis from Popular (“Popular Books”). Popular Books account for approximately 65% of Monarch’s sales and Popular appears to be the most significant unsecured creditor of Monarch. The balance of Monarch’s business involves distributing books on behalf of other publishers. Monarch purchases these books directly from the publishers (“Other Books”).
On November 13, 2015, Monarch sought court approval. Among other things, the court granted approval of a transition agreement in which it was ordered that Publisher’s Group Canada (“Publishers Canada”) would immediately become the Canadian distributor of record for Popular Books. The effect of this is that all new sales and returns for Popular Books are to be made with Publishers Canada. Monarch also obtained approval for an extension of time to file a proposal to January 5, 2016. The extension was necessary to allow the Company adequate time to meet with key stakeholders and to formulate a proposal to be put to the creditors. Once a proposal has been formulated, Monarch will call a meeting of creditors and table its proposal to creditors.
Monarch failed to file a proposal to its creditors before 11:59 p.m. (E.S.T.) on January 5, 2016, and, accordingly, pursuant to subsection 50.4(8) of the BIA, the Company was deemed to have made an assignment in bankruptcy. A copy of the Certificate of Assignment and Notice to Creditors is posted below. The First Meeting of Creditors was held at 10:00 am on January 27, 2016.
Farber was discharged as Trustee pursuant to a Court Order dated September 28, 2017.
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Reports of the Proposal Trustee
- First Report of the Proposal Trustee, November 12, 2015
- Second Report of the Proposal Trustee, December 24, 2015
- Order of Justice Newbould, dated November 13, 2015
- Order of Justice Wilton-Siegel, dated January 5, 2016
- Order Discharging Trustee, dated September 28, 2017