Estate No,/ Court File No.: 31-2117602 ONTARIO SUPERIOR COURT OF JUSTICE (COMMERCIAL LIST) IN THE MATTER OF THE BANICRUPTCY AND INSOLVENCY ACT, R,S,C, 1985, c, B-3, AS AMENDED June 30, 2016 AND IN THE MATTER OF THE .NOTICE OF INTENTION TO MAKE A PROPOSAL OF ALAN SASKIN MOTION RECORD (Returnable July 11, 2016) BENNETT JONES LLP 3400 One First Canadian Place Toronto, ON M5X 1A4 Fax: 416,863,1716 S. Richard Orzy (LSUCM231811) Tel: 416,777,5737 Raj Sahrd (LSUC#: 42942U) Tel: 416,777,4804 Lawyers for Alan Saskin
Transcript
Estate No,/ Court File No.: 31-2117602
ONTARIOSUPERIOR COURT OF JUSTICE
(COMMERCIAL LIST)
IN THE MATTER OF THE BANICRUPTCY AND INSOLVENCY ACT,R,S,C, 1985, c, B-3, AS AMENDED
June 30, 2016
AND IN THE MATTER OF THE .NOTICE OF INTENTIONTO MAKE A PROPOSAL OF ALAN SASKIN
MOTION RECORD(Returnable July 11, 2016)
BENNETT JONES LLP3400 One First Canadian PlaceToronto, ON M5X 1A4Fax: 416,863,1716
S. Richard Orzy (LSUCM231811)Tel: 416,777,5737
Raj Sahrd (LSUC#: 42942U)Tel: 416,777,4804
Lawyers for Alan Saskin
1
SERVICE LIST
BORDEN LADNER GERVAIS LLP GOODMANS LLPScotia Plaza, 40 King Street West Bay Adelaide CentreToronto, ON M5H 3Y4 333 Bay Street, Suite 3400
Toronto, ON M5H 2S7Edmond E.B. LamekTel: 416-367-6311 Joe LathamEmail: elamek@big,com Tel: 416-597-4211
Email: [email protected] B. PlunkettTel: 416-367-6314 Jason WaddenEmail: kplunkett@b1g,com Tel: 416,597,5165
Email: jwadden@goodmans,caLawyers for Urbancorp CCAA Entities
Lawyers for Reznik, Paz, Nevo Trustees Ltd,,in its capacity as the Trustee for theDebenture Holders (Series A) and Adv, GusGissin, in his capacity as the IsraeliFunctionary of Urbancorp. Inc.
THE FULLER LANDAU GROUP INC. GOLDMAN SLOAN NASH & HABER151 Bloor Street West, 12th Floor (GSNH) LLPToronto, ON M5S 1S4 480 University Avenue, Suite 1600
Toronto, ON M5G 1V2Gary AbrahamsonTel: 416-645-6524 Mario ForteFax: 416-645-6501 Tel: 416-597-6477Email GAbrahamson@Fullerl,LP,com Fax: 416-597-3370
Email: forte Ogsnh.comAdam ErlichTel: 416-645-6560 Robert J. DrakeFax: 416-645-6501 Tel: 416-597-5014Email: AErlich@FullerLLP,com Fax: 416-597-3370
Email: drake@gsnh,comThe Proposal Trustee
Lawyers for the Proposal Trustee
2
BENNETT JONES LLP CHAITONS LLP3400 One First Canadian Place 5000 Yonge Street, 10th FloorP,O, Box 130 Toronto, ON M2N 7E9Toronto, ON M5X 1A4
Lawyers for BMORaj SahniTel: 416-863-1200Email: sahnir@bennettiones,com
Jonathan G. BellTel : 416-777-6511Email : Bel1J®bennettjones,com
Lawyers for the Edge Companies and AlanSaskin
TORYS LLP ROBINS APPLEBY LLP79 Wellington Street West, 30th Floor 120 Adelaide Street West, Suite 2600Box 270, TD South Tower Toronto, ON M5ri 1T1Toronto, ON M5K 1N2
Wiittlb 410 tO.pm's,r‘ve. Valaarldmillte a vita& Noposal. to hay eteditOS.,
I. also believe-tat gOen the stipivision o iyofpropooal prootediivaby theltopo.sal.
Tro..spzi ad .:courtc, tio••,-rotfitat will be pittf4digoit.altlip tefttt f ilt0.d 414d. fholdaticotuti
thttovviii perit'itt tho 'adVallOanot
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'Portho toas'oxs. Sot at AbOVe:,. I lielirtite that atrexotisiob o'f.te to filo' apt 4O1..wilf
:testa to the .o 'ti tyl a viabl. prOposit totoy apditots, I 13woar this .affidavit in support .of
.the,Orders ,req);lested :and make :affidavit For no, improper or othorpirpose,
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TA /0SUPERIO RT JUSTICE
(J1 usT)riN tANkRuii
Conti Pile No.CetirtFije No,Quirt Pile No,.Court Pile No,
31.211755131.211158431-21175031.2117602
IN" THE SMATTER Op THE NOTICES OP INTENtION TO MAKE APROPOSAL OP EOVEsrr, INC„ EDGE REStiENTIAL INC„EDOE.ON TRIANOLSPARK INC„ and ALAN SASKIN
AI IXIOAVIT 9,k1 ALAN 'RASKIN.(Sworn' May 20, 281:6)
(On 1Vlotion for ExtensiOn 'of Moe to File Proposals)
I, ALAN RASKIN, of the City of Toronto, in the Por/11100 of Ontario, HAKE OATH
AND SAY AS FOLLOWS:
1, X am the sole officer and director of Bosvest Inc, ("Bosvest"), Edge Residential be,
("Residential") and Edge on Triangle Park Xno, ("Triangle") (Bosvest, Residential and Triangle
are collectively referred to as the "Edge Companies"), Each of the Edge Companies and X have
filed Notices of intention to Make a Proposal ("NQXs") under the Bankrtiptcy and Insolvency Act,
R,S,C, 1985, op B-3, as amended (the "MA") in :respeet of which the orders requested in the
within motion are sought and as such, I have lolowledge of the matters set out below,
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Overview
2, The Edge, Companies are indirect subsidiaries of Urbancorp Inc. ("UCI"), Which is the
100% Shareholder of Urbancorp 'Cumberland 2 GP Inc, ("Cuniberland 2 OP"), which in turn is
the general partner of Urbancorp Cumberland 2 LP ("Cumberland 2 LP"), which is the sole
sharehOlder and beneficial owner of the assets of Bosvest and an indirect shareholder of
Residential and Triangle. Cumbedand 2;1,1? is .also the:sole shareholder of Westside Gallery Lofts
("Westside Gallery"), 'The Edge Companies, Cumberland 2 GP, Cumberland 2 LP and
Westside Gallery are .collectively referred to herein as the "Cumberland 2 Group", A copy of
the UCI's basic organizational chart showing the Cumberland '2 group and their relationship to
UCI is attached hereto as Exhibit "A",
3, On May 18, 2016, the Ontario Superior Court of Justice (Commercial List) (the
"Ontario Court") issued the following Orders in respect of UCI and certain of its subsidiaries,
excluding the Cumberland 2 Group:
an Initial Recognition Order (Foreign Main Proceeding), recognizing proceedings
(the "Israeli Proceedings") .commeneed in the District Court of Tel Aviv.Yafo,
Israel (the "Israeli Court") on April 25, 2016 .as the foreign main proceeding in
respect of UCI pursuant to Part IV of the Companies' Creditors Arrangement Act
("CCAA") and recognizing Guy Gissin, the Functionary Officer and foreign
representative of UCI appointed by the Israeli Court .as the "Foreign
'Representative" ;
(b:,. a Supplemental Order (Foreign Main Proceeding), which inter Oa, appointed
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KSV koftinan foci, ("ItM as the ."intdrination officer" 'of the Ontario Courtin
respect 'of the Israeli Proceedings and set out the powers of the InformatiOn
Officer; and
an Initial 'Order pursuant to the CCAA '(the "CCAA Iuit ai Order") in respect of
most Of the direct and indirect subsidiaries of .UCX (the '"CCAA COMpanies"), bUt•
not including Any of the companies in the Cumberland :2 ,Group, ,Pursuant to th(1,
CCAA Initial Order, KSV was ,appointed as monitor .(the "Monitor") in respect Of
the CCAA Companies with enhanced powers to 'oversee .and manage the business
and. operations of the CCAA Companies, and 11 prOtocOl was approved for
cooperation between the Monitor and the Forel:in Representative,
Copies ,of the .aforemantioned Orders are attached •as Exhibit "B" (Initial Recognition
Order); Exhibit "C" (Supplemental Order (Foreign Main Proceeding) .and Exhibit "D" (CCAA
Initial Order),
4, As noted above, the Cumbedand 2 Croup is not a debtor in either the aforementioned
CCAA proceedings or the Israeli Proceedings, On April 29, 2016, each of the Edge Companies
and X tiled NOIs with the Office of the Superintendent of Bankruptcy Canada, with The Fuller
Landau Group Inc, ("FL") as proposal trustee (the "Proposal Trustee"), The NOT proceedings in
respect of the Edge Companies have been kept separate from the .CCAA proceedings in respect of
UCI's other subsidiaries as the Edge Companies aro dealing primarily with claims of direct trade
creditors and construction lien claimants as opposed to the Israeli bondholder elairns and other
claims being dealt with by UCX and the •CCAA Companies, However, since UCX is the parent of
the Cmnberland 2 Group and there are intercompany claims between some of the CCAA
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.COrritianies 'and cOniPiinies in Oirrnitierland 2 Group, the Proposalirnstee has kept Canadian
counsel for the UCX •Poreign Representative and the Monitor for the CCAA Companies apprised
of the Edge Companies' NOI proceedings and has informed the that it intends to continue to keep
them so apprised 'and consult with them in connection with their respective interests in the
Cumberland 2 Group,
5, The stay of proceedings provided by the NOIs in respect of each of the Edge
Companies and myself will expire on May 28, 2016, As explained in greater detail below, the
Edge Companies and X have been engaged for several months in attempting to reach informal
settlements with creditors but without .overall success, In light of the Isreall Proceedings in
respect of UC1 and the insolvency preooedings commenced in .respeot of the other companies
within the Urbancorp group, the NOX proceedings in respect of :the Edge Companies were
undertaken to .ensure a •fair, Court-supervised process to oontinue to see if a oomprornlse or
settlement can be achieved with creditors, X believe that an extension of time to file proposals is
necessary to permit me and the Edge Companies to formulate, ,diseuss and implement one or more
workable proposals to creditors which will have their support and acceptance,
Without the extension, it is anticipated that the Edge Companies and X will riot be in a
position to make viable proposals before May 28, 201.6 and will likely become bankrupt, If that
happens, it will be to the detriment of the .creditors of the Edge Cornpanios and to my oreditors,
Moreover, none of my nor the Edge Companies' creditors would be materially prejudiced if the
extensions are granted.
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7, At the present time, banking arrangethents and related Services are proVided to the
Edge Companies by Urbancorp Residential Inc, ("Urbancorp Residential"), Urbancorp
Residential is one of the CCAA Companies, The Edge Companies do not presently have their
own bank accounts to receive payments a rent from the rental units and from which to pay their
expenses, Accordingly, interim arrangements have been :made with the CCAA Monitor to permit
Urbancorp Residential to continue to receive monthly rent cheques and to remit .the money
received to the Proposal Trustee for the •benefit of Residential, The Proposal Trustee has opened
trust accounts to ,accommodate these circumstances and the within motion requests that the
Proposal Trustee be authorized by the Court to open and manage bank accounts for the Edge
Companies to provide greater control over their cash management and avoid potential conflicts
relating to the CCAA 'Companies,
8. Cash flows for each of the Edge Companies have been filed in connection with the
NOPs and are attached as Exhibit "E" hereto and my personaLcash. flow filed in connection with
the NC% is attached as Exhibit 'IT", While there is not an immediate need .for cash at this time, the
edge Companies will be exploring the awdlability of debtor in possession financing or other
means of ensuring the Edge Companies can continue to meet their eash needs,
9, Among those cash needs are the amounts needed to fund professional fees 'throughout
these proceedings, Until alternate arrangements can be made, the Edge) Companies are seeking a
charge in the amount of $250,000 to seoure the payment .of .professional fees and disbursements,
Should money .be made available 'through the 'sale of units or other appropriate moans of raising
cash, these arrangements can be revisited and reasonable adjustments made to address the then
current circumstances,
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.osvest
10, Bosvest is a corporation incorporated on December'31, 2004, pursuant to tho 'laws of
Ontario, In 2010, Bosvest contracted with a partner in a co-tenancy arrangement, whereby
Bosvest would hold a 66,67% interest in Triangle and the ,partner would hold a 33,33% interest in
Triangle, :In. accordance with those arrangements, the partner and Bosvest built a mixed project
which includes income producing and development parts which is 'known as the "Edge Project",
The EdgeProject consists oftwo towers of 21 and 22 stories built on top .of a 7 story podium with
a total above grade buildable floor area of approximately 690,678 sqft, consisting of 666
residential units, The bulk of those units have been sold and the cotenancy arrangement with the
aforementioned partner was terminated such that Bosvest is now the solo owner of Triangle,
There are 32 residual unsold 'units Which are still held by Residential as nominee for Cumberland
2 I .as rental units, Approximately 38;954 sq, ft, of vacant office 'space and 10 residential units
are held by Triangle, also as a nominee for Cumberland 2 L1. The beneficial interests in these
properties are ultimately held by Cumberland 2 LP, which Itself recently filed an NOIon May 20,
2016 with FL as Proposal Trustee,
Creditors of Dosvest
11, As disclosed in the list of creditors in the NQI filing, Bosvest has .creditors who are
owed approximately $5,4 .million according to its books and records, This list.of creditors is
attached as Exhibit "G" and may be subject to revisions as the Proposal Trustee receives any
additional claims and reviews information relating to claims,
W51IMAL107573610000 IA 13626500x2
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12. On May 16, .2016, search of reigistratiens' against BoSveSt was ,Coridticted under the
Personal Property .Secarity Act, R.8.0, 1990,.c, P,10, as amended (the "ITSA"), The uncertified
search results disclosed the following .secured creditors for Bosyest (in order of their registration):
Crater potent! Collateral
Firm Capital Mortgage Fund Inc, Share pledge agreementrespecting shares in the capitalstoOk of'Tilangle
Terra Firma Capital Corporation Multiple).SecurIty
Attached as Exhibit "1-1" is .a copy of the PPM Search for Bosvest dated May 16, 2016, 'Bosvest •
and the Proposal Trustee are reviewing these registrations and the fact that they are listed herein is:
not an admission of the validity of their security or any cletinis the claimants may assert.
Funding during the Islat
.13, Since Bosvest filed Its NO1 on April '29, 2016, Bosvost has incurred no cash needs
other than funding of its professionals in connection with N proceedings and related matters,
Triangle
14, Triangle .is a corporation incorporated on February 2, 2010 pursuant to the laws of
Ontario, As mentioned above, I am the sole officer and director of Triangle, ,Arnong other things,
as noted above Triangle owns as a nominee approximately 38,954 sq, ft, of vacant office space in
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the Edge Project, which space is .subject to a Section 37 (Planning Act) agreement with the City of
Toronto; as well as 10 residential units,
Creditors of Mangle
15. As disclosed in the list of creditors in The NOX filing, Triangle's creditors are Owed
approximately $27,5 million according to its books and records, This list of creditors is attached
Its Exhibit "r and may be subject to revision as the Proposal Trustee receives any additional
claims and reviews information relating to claims,
16, On May 16, 2016, a search of registrations against Triangle was conducted under the
PPSA, The uncertified .search results disclosed the following secured creditors for Triangle (in
order of their registration):
crccli.tor
Aviva Insurance Company ofCanada)3 auk of Montreal
Bank of Montreal
Tem Firma Capital Corporation
WSL5OAL1015736100001 \13626500v2
Generojgolloteral Description
Multiple murky on property at2,6 LisgarStreet, Toronto
Assignment of proceeds under anagreement between Epic on Triangle ParkIna, and the debtor dated June 20, 20.12
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Siller WS kip SOInti6ns up Xno, TWOliadtilsorter recycling syketns.FortyIloor oontrolpanels for ,automatedfootling systeilisi Two V'St 302cornp4otors, TWo extension hoppers,ThWeetit 5.-yardgarbage compactioncontainors"(sedatnninhors CA 'through
(31 ).1!:T.41400q-Y,*.fMit grid loadingreqcling COntainers numbers.SithroUgh SI)',""tWO.WS6 2", generationodourdontiols, Three 3yar0 noncompaction. garbage containers for the retailcomponent,
Terra IIrma Capital Corporation Property used in •connection with or situateat orarising from the ownership,develetiqi6nt,nse ar disposition of the landsknowns as 2.6 Lissar Street, Toronto andthe proceeds there'd,
Attached as Exhibiti" is •a copy of the PPSA Search forTriangle dated May 16, 2016, Trianglb
and the Proposal Trustee are reviewing these registrations and the fact that they are listed herein is
not an admission of the validity of their security or any claims that the claimants may assert,
Funding during the NM
17, Triangle has .approximately $100,000 in trust funds hold by 'its legal counsel, Its most
pressing cash needs total approximately $24,000 consisting of condominium fees, maintenance
expenses, and small scale construction costs,
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18, Residential is a corporation incorporated on April 10, 2015 pursuant to thelaws of Ontario of
which I am the •sole officer .and director. Residential holds 32 oondominium Units lathe Edge
Project as a nominee for Bosvest though the :ultimate beneficiary is Cumberland 2 LP,
Creditors of Residential
19. As disclosed in the list of creditors in the NOI filing, Residential has creditors who are
owed approximately $7,2 million according to its boeks and records, This list of creditors is
attached as 13xhibit "K" and may be subject to revision as the Proposal Trustee receives any
additional .claims and reviews information relating to claims,
20. On May 16, 2016, a search of registrations against Residential was conducted under
PPM, The uncertified search results disclosed the 'following secured creditors for Residential (in
order of their registration):
Terra Firma Capital Corporation
gencrat c9liett914pocriptiva
Assignment of rents withrespect to various units at 2-6Lisgar Street (96 Lisgar Street),Toronto Standard CondominiumPlan No, 2448, City of Toronto
Attached as Exhibit "L" is a oopy of the FFSA Search for Residential dated May 16, 2016,
Residential and Proposal Trustee are reviewing these registrations and the fact that they are listed
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herein IS not .adnAssiOn of the validity (:)i' their security or any claims that the claimants may
assert,
Fultding.darhtg the ATM
2'l, Residential is. awaiting the collection of approximately $24,00 'from Urbancorp
Residential with respect to monthly rent for the rented Residential 'condominium units that were
deposited into Urbancorp Residential's bank account. As well, ongoing rental revenue due to
Residential but automatically deposited to Urbancorp Residential' s bank •account will be paid to
Residential from Urbancorp Residential on a monthly basis. Residential's most pressing cast
needs total approximately $90,000 consisting of condominium fees, maintenance expenses, and
limited 'construction costs,
Saskin
22, As sot out more' comprehensively in my affidavit sworn and filed in• the CCAA
Proceedings in respect of the .CCAA Companies, I arn the sole director and officer of the CCAA
'Companies and I felt it 'was appropriate to steplback and to recommend that the Monitor be vested
with enhanced powers as monitor to make ,material decisions in respect of the operation of the
business and the conduct of the activities within the CCAA Proceedings, whieh hope will have
the effect of building stakeholder confidence and maximizing value in the restructuring process
undertaken in the CCAA. Similarly, the .edge Companies were filed into NCH proceedings to
ensure a fair, court.supervised process to try and Teach a compromise with their creditors and
maximize value for the creditors of the Cumberland 2 Group,
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As an individnal, X am etirrently facing 'a number of claims and lawsuits emanating
from a variety of sources including class action lawsuits, breach of trust claims under the
Construction Lien Act (Ontario) and direct claims for money borrowed or for loans which X have
personally guaranteed, Prior to the filing of the NON• I had been attempting to informally
negotiate with creditors for forebetwance of their claims :against me, As a result of the quanturn
and diversity of such °Mims and increasingly evident realization that owing to the disposition of
certain creditors it was not practical for me to continue to try and deal with These claims outside of
a restructuring proeeeding, I took the. decision .to file myself and the Edge Companies with a viow
to pursuing a workable solution in tho form .of a proposal,
Creditors of Saskitt
24, In my list of creditors in the NOI filing, I have listed creditors .who are owed
approximately $23 .million, This list includes .approximately $14;073 million asserted by
claimants in a class action claim filed in Israel, in respect of which my liability (if any) has not yet
been determined. This list of creditors is attached as Exhibit "AV and may be subject .to revision
as the Proposal Trustee receives any additional claims and reviews information relating to claims,
25, On May 16, 2016, a search of registrations against me under PPM was oonduoted, The
uncertified search disclosed the •following secured creditors (In order of their registration);
Creditor Giene;ial ColInteral,Descdptioll
MVL Leasing Limited 2014 Tesia S (VW 5Y,1SAIH20EFP64795)
MVL Financial Services Limited '2003 Aston Martin DB9 (YINSCFADO2A350B03303)
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Terra Pirriut Capital Corporation pledge of shares in Urbana*Hold%) Ina, andUrbancolp
First Capital Realty Inc, Late 'Renewal of Registration Munber2010060810521292677
Terra Firma Capital Corporation Guarant6e, & assignment & Postponementgiven by the debters in favour of the,seaured party which, assigns, and postponesall debts and liabilitieo owed by.Urbancoiplioldao Inc, to tho debtors,
Canadian Mortgage Servicing Assignrn'ciiit andpostponernent in favour ofCorporation the secured:party of all indebtedness and
liability of Urbancorp (Patricia) Ina, to thedebtor(s) pursuant to guarantee given bythe debtor to the secured party,
Canadian Imperial Bank of Postponement of all claims of the debtorsCommerce with respect to all debts and liabilities of
Urbancot'p (LeslieVille) Developments Inc,to the debtors, ail, of which are postponed infavour of the secure :,party,
Terra Firma Capital Corporation
Atrium Mortgage Investment Guarantee and postponement of claimCorporation given by the debtors in favour °lithe
muted party which 'assigns and postponesall debts And liabilities owed by Urbanaorp(Patricia) Ina, to the debtors,
Atrium: Mortgage Investment Guarantee and postponement of claim'COrporation given by the debtors l'ireavour of the
scoured party which assigns and postponesall .debts and liabilities owed by Urbanoorp(Mallow) Inc, to the debtors,
Terra Firma Capital Corporation Subordination and assignment reUrbaneorp (Patricia) Ina, debt,
Laurentian Bank of Canada Assignment of accounts owing byUrbancorp (Patricia) Ina, and assignment ofahoses-in,action and 'other claims which thedebtor has :against Urbancorp (Patricia) Ina,
• Terra Firma Capital Corporation
WSL, A 1,1071736\0000111$626500v2
Atrium 1Viortgage InveknientCorporation
Laurentian Bank of Canada
Terra Firma Capital Corporation
Terra Firma Capital Corporation
TWO, Firma Capital Corporation
Terra Firma Capital Corporation
Hendrick and Main DevelopmentsIna,First Capital 1071 Corporation
Firm Capital Mortgage Fund Inc,
Bank of IVIontreril, asadministrative agent
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Guarantee and postponement of darngiven by the debtors in favour; of thesecured party which assigns and postponesall debts and1iabilities owed by Urbancorp(Bridlepath):Ine. to the debtors,
Assignment of flOcatInt8 owing byUrbancorpu(Woodbine) Inc, and assignmentof choses.in-action •and other elaims whichthe.debtor has against Urbancorp(Woodblne)
;Security interest in all of the debtor's right,title and interest in all persOnal propertylocated at, arising from .or used inconnection with the lands and premisesmunicipally known as 1780 LawrenceAvenue West, Toronto, including withoutlimitation all present and future rantsarisingtherefrom,
Postponement and assignment to and infavour of the secured party of allindebtedness arid liability now or hereafterowing from Urbancorp (Lawrence) Dm tothe debtors,
guarantee and postponement of claim withrespect to Urbancorp Old Mill Inn.
Postponement of claims.
Assignment of all claims owing byUrbancorp The Bridge Inc, in favour ofAlan Saskin,
Attached as Exhibit "N" is a copy of the PPSA Search for me dated May 16., 2016. X and my
Proposal Trustee are reviewing these registrations and the hot that they are listed herein is not an
adrnission of tho validity of their security or any claims the claimants may assert,
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:Extern..ion iVIVite.hr Me 106
26, 'I am advised by my counsel, that the test for whether to extend the time for filing a
proposal under 'an NOI may be summarized as follows:
The person seeldng the extension acted, and is acting, in good faith and with clue
diligence;
The.persOn seeking• the extension would likely be .able to make a viable proposal if
the extension were granted; and
No creditor would be materially prejudiced if the extension were granted,
27, As noted above, I believe that the Edge Companies and myself have been noting in
good faith with regard to all of their respective creditors and stakeholders and my own creditors
by engaging in Court-supervised proceedings to ensure a fair process that seeks to maximize
value, I also believe that the gclp Companies and I have been diligent in these •efforts and have
been working tirelessly over the past several months to address the Challenges faced by our
insolvenoies, The restructuring of the Urbancorp group of eompanies is wide-ranging, and that of
the Edge .Companies while more self-contained still has multiple intercompany connections. As
the principal equity holder at the top of the oorporate chart, my proposal will depend on the
various outcomes with respect to Ufbaneorp entities both within the CCAA proceedings, these
NOI proceedings and beyond, The Edge Companies and I have retained knowledgeable and
effeetive Proposal Trustee and representation to deal with the complexities, By allowing time to
deal with those complexities and work on a plan to MaXIMIZO value for creditors, I believe that I
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and the 8clge Companies will be able to preserve value and slake a viable proposal to their
oreditors,
28, X also believe that given the supervision of these proceedings by the Proposal Trustee
and the Court, no creditor will be prejudiced if the extension is granted and the additional time
will permit 'the advancement of the formulation of a workable proposal,
Administration Charge
29, It is contemplated that FL, In its capacity as the proposal trustee of each of the Edge.
Companies, counsel to the Proposal Trustee, and counsel to the Edge Companies would be
granted a court”ordered charge on the assets, property, and undertakings .and any additions or
replacements thereto of each of the Edge Companies. to MUM their fees and disbursements up to
the maximum amount of $250,000 (the "Administration Charge"). X am of the view that the
Administration Charge is fair and reasonable in the eircuMstanees and will belp to ensure that the
professionals engaged in the restructuring process will be able to carry out their work for the
benefit of 'the creditors .of the Edge Companies,
30, The nature of the Urbancorp group of companies' business and operations requires the
expertise., knowledge, and continuing participation of the proposed beneficiaries of the
Administration Charge in order to complete a viable proposal, The professionals that are to be
beneficiaries of the Administration Charge have contributed, and continue to contribute, to the
restructuring process and the planned .proposal, I believe that the. Administration Charge is
necessary to ensure their continued participation,
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Noe:aupal eonsolidiiiiim
3.1, Each .of Triangle and Residential are nominees for .nn ultimate beneficiary, Cumberland .2
LP, At the time of swearing this affidavit, Cumberland 2 LP and its general partner, Cumberland 2
OP 1ne, have also recently filed NOI's. The Proposal Trustee will be reviewing furtNr
information relating to those entities to' determine whether to seek the Court's permission tO
consolidate those proceedings with the.Cumberiand 2 proceedings at a future court appearance,
32, I have been advised by the Proposal Trustee that unless directed differently by the Court,
the Proposal Trustee would be obliged under the 131A to make multiple motions, filings, and
reports in respect of each of the NOI filers,
33, I believe that those proceedings can be more economically and effielently managed on
a joint basis for the Edge Companies through proeedural consolidation, which will lesson the cost
and impact on creditors and stakeholders and will riot prejudice an,y party.
Conclusion
34, Por the reasons set out above, I believe that an extension of time for the Edge
Companies and myself to file proposals. will result in the production of a viable proposal to their
and to my creditors respectively. I swear this affidavit in support of the Orders :requested and
make this affidavit for no improper or other purpose,
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SIVORNI3EFORE.M. tha City OfToronto ln the Pr ovum of Ontario this20th day of May, 20i
