Engagements

One Kenton Alzheimer Center of Excellence (Non-Profit) Inc. and B’Nai Brith Hillel of Toronto Inc. (the “Kenton Group”)

Proposal Proceedings

On June 23, 2015, One Kenton Alzheimer Center For Excellence (Non-Profit) Inc. (“Kenton”) and B’nai Brith Hillel of Toronto Inc. (“BBH”, and together with Kenton, the “Kenton Group” or the “Debtors”) each filed a Notice of Intention to Make a Proposal (“NOI”) under section 50.4 of the Bankruptcy and Insolvency Act (the “Act”) and A. Farber & Partners Inc. was appointed as Proposal Trustee for both estates (the “Proposal Trustee”). The Debtors own and operate a home which cares for residents with early stage Alzheimer’s and dementia.

The Kenton Group is not bankrupt. The NOI filings by the Kenton Group provide an automatic stay of proceedings against the creditors of the Kenton Group for a 30 day period (the “Stay Period”), thus providing the opportunity to restructure the affairs of the Kenton Group and formulate a proposal to creditors. Central to the restructuring and the ability to formulate a viable proposal is the goal of conducting a sales process which culminates in the transfer of this first class home to a specialist operator in a seamless fashion. Operations will continue in the normal course while the sales process is undertaken.

Court Proceedings

All capitalized terms not defined herein shall be as defined in the Proposal Trustee’s First Report to Court.

The Kenton Group brought a motion in front of the Ontario Superior Court of Justice (Commercial List) (the “Court”) on June 26, 2015 and was granted an Order for, among other things:

a)      Administratively consolidating the individual proposal proceedings of Kenton and BBH under one proceeding;

b)      Approving an interim financing arrangement for the Kenton Group and the DIP Lender’s Charge;

c)      Approving a Sale Process;

d)     Granting an Administration Charge in favour of the Proposal Trustee (including in its capacity as trustee in bankruptcy, if applicable), counsel for the Proposal Trustee (including as counsel to the trustee in bankruptcy, if applicable), and counsel for the Kenton Group; and

e)      Extending the Stay Period to September 4, 2015.

A Motion was heard on Septebmer 2, 2015 and an Order was granted by Justice Newbould approving the relief sought, including extension of the NOI period to October 19, 2015:

a)   extending the time within which a proposal must be filed with the Official Receiver (the “Proposal Period“) to and including October 19, 2015 to allow the Sales Process to continue; and
b)   providing that all references to “One Kenton Alzheimer Center of Excellence (Non-Profit) Inc.” in the Order of the Honourable Mr. Justice Newbould of the Ontairo Superior Court of Justice (Commercial List) dated June 26, 2015 (the “June 26 Order“) and the DIP Term Sheet (as defined in the June 26 Order) be replaced with “One Kenton Alzheimer Center For Excellence (Non-Profit) Inc.”, nunc pro tunc.

The Motion materials for the September 2, 2015 hearing, the Second Report of the Proposal Trustee reporting on the Sales Process in support of the requested relief set out above, and the Court Order and Endorsement of Justice Newbould, are attached below.

Motion – October 15, 2015

On October 15, 2015 there is a motion to among other matters:

1. An order (the “Approval and Vesting Order”) substantially in the form of the draft order attached as Tab 3 of the Motion Record:

a) approving the sale transaction (the “Transaction”) contemplated by the agreement of purchase and sale (the “Sale Agreement”) between the Kenton Group and Avcon Construction Inc. (in such capacity, the “Purchaser”), dated September 25, 2015, and vesting in the Purchaser the Kenton Group’s right, title and interest in and to the Purchased Assets (as defined herein), free and clear of any claims and encumbrances, other than certain permitted encumbrances

2. Seek Court approval of:

a)  the extension of the time within which a proposal must be filed with the Official Receiver pursuant to s. 50.4(9) of the BIA (the “Proposal Period”) to and including November 16, 2015;

b)  the execution by the Kenton Group of the Supplement to the Interim Financing Facility Terms and Conditions among the Kenton Group, as borrowers, and The Bank of Nova Scotia, as lender, dated as of October 5, 2015 (the “Supplement to the DIP Term Sheet”) and that, in addition to the interim financing terms and conditions approved by the Order of Justice Newbould dated June 26, 2016 (the “Original DIP Facility”), such credit facility shall be on the terms and subject to the conditions set forth in the Supplement to the DIP Term Sheet; and

c)  sealing the confidential supplement (“Confidential Supplement”) to the third report of Farber as Proposal Trustee (the “Third Report”) until further Order of this Court

The related court motion materials for the court hearing on October 15, 2015 and Proposal Trustee’s Third Report in support of the matter are, attached below.

It is confirmed that on October 15, 2015, the Court issued an Approval and Vesting Order approving the Transaction as defined above, as well as a Court Order extending the time for the Kenton Group to file a Proposal to November 16, 2015 and other relief cited in paragraph 2(b) and (c) above.

Copies of the two court orders are attached below, along with an Endorsement of Justice Frank Newbould, dated October 15, 2015.

 

Motion – November 10, 2015

A motion was heard on November 10, 2015 with a court order sought for the following:

i) extending the time period for filing a Proposal to and including November 23, 2015;

ii) approving a distribution of the proceeds from the Sale Transaction to BNS up to the amount of the Kenton Group’s secured indebtedness to BNS;

iii) approving the First Report of the Proposal Trustee dated June 24, 2015, the Second Report of the Proposal Trustee dated August 26, 2015, the Third Report of the Proposal Trustee dated October 9, 2015, and the Fourth Report of the Proposal Trustee and the activities of the Proposal Trustee described therein;

iv) approving the fees and disbursement of the Proposal Trustee for the period to and including October 31, 2015; and

v) approving the fees and disbursement of the Proposal Trustee’s independent legal counsel, Chaitons LLP, for the period to and including October 31, 2015;

A copy of the November 10, 2015 motion record and Trustee’s Fourth Report are attached below.  A copy of the Court Order and Endorsement of Justice Newbould are also provided below.

Motion – May 17, 2016

On May 17, 2016, A. Farber & Partners Inc., the court-appointed Trustee in the Proposal of One Kenton Alzheimer Center for Excellence (Non-Profit) Inc. and B’Nai Brith Hillel of Toronto Inc., brought a motion for an order:

i) approving the Fifth Report of the Proposal Trustee dated April 8, 2016 (the “Fifth Report”) and the activities of the                    Proposal Trustee described therein;

ii) approving the fees and disbursements of the Proposal Trustee and its counsel;

iii) authorizing the distribution of residual funds to B’Nai Brith Congregation Synagogue (Non-Profit) Inc., and to assign the            balance of the landscape security deposit held by the City of Toronto, to the extent of the BNS Deficiency (as defined in            the Fifth Report); and

(iv) discharging and releasing the Proposal Trustee.

A copy of the May 17, 2016 Motion Record and Trustee’s Fifth Report are posted below.  The relief sought was granted during the May 17, 2016 Motion; copies of the Order and Endorsement are posted below.

Sale Process

As mentioned above, on June 26, 2015, the Court issued an Order approving, among other things, the Sale Process.

The Order authorizes and directs the Proposal Trustee to undertake a marketing and sale process with respect to all of the assets, rights, undertakings and properties of the Kenton Group related to a modern, purpose built residence, catering to Alzheimer and Memory Care residents, located in North York, Ontario (the “Property”).

The Sale Process is intended to attract interested parties for all or part of the Property at a price which maximizes recovery of proceeds, enhances the ability of the Debtors to make a viable proposal to creditors and increases the prospects of restructuring the Debtors’ affairs for the benefit of all the Debtors’ stakeholders. Interested parties will have until 5:00 p.m. EDT on Thursday, September 17, 2015 to submit a binding offer. The following documents are made available for review by interested parties:

– Kenton Group Opportunity Teaser

– Sale Process Terms and Conditions

– Confidentiality Agreement

Enquiries for potential purchaser qualification should be made to the Proposal Trustee by contacting Noah Litwack at (416) 496-3719 or via email at nlitwack@farberfinancial.com. Upon receipt of an executed Confidentiality Agreement and the Proposal Trustee’s approval of same, interested parties will be invited to the Proposal Trustee’s virtual data room by email.

Upon obtaining access to the virtual data room, each interested party acknowledges and agrees to the receipt of the Terms and Conditions and agrees to be bound by such Terms and Conditions.

The purpose of this website is to provide documents to any interested persons regarding these proceedings.  The documents listed below are a compilation of documents posted during the course of the proceedings and can be viewed and/or downloaded in .pdf format.  Additional documents and information will be posted as it becomes available.

Motion Materials

Reports of the Proposal Trustee

NOI Documents

Court Orders