ONTARIO SUPERIOR COURT OF JUSTICE - BDO Canada · ONTARIO SUPERIOR COURT OF JUSTICE B E T W E E N:...

CAN: 22443870.1

Court File No.: CV-16-11424-00CL

ONTARIOSUPERIOR COURT OF JUSTICE

B E T W E E N:

EMMANUEL VILLAGE RESIDENCE INC.

Applicant

- and -

ATTORNEY GENERAL OF ONTARIO

Applicant

- and -

1250 WEBER STREET EAST, KITCHENER, ONTARIO OR THE PROCEEDS OF THESALE THEREOF (IN REM)

Respondent

MOTION RECORDOF EMMANUEL VILLAGE RESIDENCE INC.

August 19, 2016 DLA PIPER (CANADA) LLPBarristers & Solicitors1 First Canadian Place100 King Street West, Suite 6000P.O. Box 367Toronto ON M5X 1E2

Bruce Darlington (LSUC# 25310K)[email protected]: 416-365-3529Fax: 416-369-5210

Jennifer A. Whincup (LSUC# 60326W)[email protected]: 416-365-3425Fax: 416-369-5240

Lawyers for Emmanuel Village Residence Inc.

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CAN: 22443870.1

TO: ATTACHED SERVICE LIST

CAN: 21934684.1

SERVICE LIST

TO: THORNTON GROUT FINNIGAN LLPSuite 3200, 100 Wellington Street WestP.O. Box 329, Toronto-Dominion CentreToronto, ON M5K 1K7

Leanne M. [email protected]

Tel: 416-304-0060Fax: 416-304-1313

Asim [email protected]

Tel: 416-304-0595Fax: 416-304-1313

Lawyers for BDO Canada Limited

AND TO: TORKIN MANESBarristers and Solicitors151 Yonge Street, Suite 1500 Toronto ON M5C 2W7

Jeff [email protected]

Tel: 416-777-5413Fax: 1-888-587-9143

Lawyers for HMT Holdings Inc.

AND TO: GOLDMAN SLOAN NASH & HABER LLPBarristers and Solicitors480 University Avenue, Suite 1600 Toronto ON M5G 1V2

Brendan [email protected]

Tel: 416-597-6489Fax: 416-597-9922

Lawyers For Sure Mortgage Capital Inc.

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CAN: 21934684.1

AND TO: BENNETT JONES LLP3400 One First Canadian PlaceP.O. Box 130Toronto, OntarioM5X 1A4 Canada

Jonathan [email protected]

Tel: 416-777-6511Fax: 416-863-1716

Joseph [email protected]

Tel: 416-777-4828Fax: 416-863-1716

Plaintiffs in Court File No. CV-10-8597-00CL

AND TO: MINISTRY OF THE ATTORNEY GENERALCivil Law DivisionCivil Remedies for Illicit Activities Office (CRIA)720 Bay Street8th FloorToronto, ON M7A 2S9

Gary Valiquette (LSUC#34925M)[email protected]

Tel: 416-214-5881Fax: 416-314-3714

Jennifer Malabar (LSUC#49358M)[email protected]

Tel: 416-327-2932Fax: 416-314-3714

Ronald Carr (LSUC#13341F)[email protected]

Tel: 416-326-2704Fax: 416-326-4181

Counsel for the Attorney General of Ontario

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CAN: 21934684.1

AND TO: MINISTRY OF NATIONAL REVENUEc/o Department of Justice CanadaOntario Regional OfficeThe Exchange Tower130 King Street WestSuite 3400, Box 36Toronto, ON M5X 1K6

Diane Winters / Peter [email protected]@justice.gc.ca

Tel: 416-973-3172Fax: 416-973-0810

Lawyers for Canada Revenue Agency

AND TO: MINISTRY OF FINANCELegal Services Branch6th Floor, 33 King Street WestOshawa ON L1H 8H5

KEVIN O'[email protected]

Tel: 905-433-6934Fax: 905-436-4510

AND TO: RETIREMENT HOMES REGULATORY AUTHORITYOffice of the Registrar160 Eglinton Avenue East, Fifth FloorToronto, ON M4P 3B5

Heather [email protected]

Tel: 416-487-1223Fax: 416-440-3570

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CAN: 21934684.1

AND TO: KRONIS, ROTSZTAIN, MARGLES, CAPPEL LLPBarristers and Solicitors25 Sheppard Avenue West, Suite 1100 Toronto ON M2N 6S6

Onofrio [email protected]

Tel: 416-225-8750x262Fax: 416-225-7214

Lawyers For Bank Of Nova ScotiaSecured Party

AND TO: RCAP LEASING INC.5575 North Service Road, Suite 300Burlington, ON L7L 6M1

Secured Party

AND TO: OLDFIELD, GREAVES, D’AGOSTINOBarristers and SolicitorsP.O. Box 16580172 King Street SouthWaterloo, Ontario N2J 4X8

Edward L. D’[email protected]

Tel: 519-576-7200Fax: 519-576-0131

Proposed Representative Counsel of EVH Residents

AND TO: CITY OF KITCHENERRevenue division200 King Street West, Ground floor Kitchener, ON N2G 4G7

Tel: 519-741-2450

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CAN: 21934684.1

AND TO: GOWLING WLG LLP50 Queen Street NorthSuite 1020, PO Box 2248Kitchener, ON N2H 6P4

Ross F. [email protected]

Tel: 519-575-7525Fax: 519-571-5025

AND TO: 1459671 Ontario Inc.Ajinderpal Bajaj10 Professor’s Lake ParkwayBrampton, ON L6S 4T5

AND TO: 1459672 Ontario Inc.Rajesh Chowdhry4 Cobbler StreetBrampton, ON L6X 4T4

AND TO: 1459673 Ontario Inc.Inderpal S. Bajaj97 Professor’s Lake ParkwayBrampton, ON L6S 4P8

AND TO: Ajindrapal Singh10 Professor’s Lake ParkwayBrampton, ON L6S 4T5

AND TO: Rajesh Chowdhry4 Cobbler StreetBrampton, ON L6X 4T4

AND TO: Inderpal Bajaj97 Professor’s Lake ParkwayBrampton, ON L6S 4P8

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CAN: 21934684.1

AND TO: GOODMANS LLPBay Adelaide Centre333 Bay Street, Suite 3400Toronto, ONM5H 2S7

Joe [email protected]

Tel: 416-597-4211Fax: 416-979-1234

Counsel for Revera Inc.

CAN: 22443870.1



B E T W E E N:


Applicant

- and -


Applicant

- and -


Respondent

INDEX

1. Notice of Motion returnable August 31, 2016

2. Affidavit of Judith Ann Hunking, sworn August 19, 2016

3. Draft Approval and Vesting Order

4. Draft Ancillary Order

TAB 1



B E T W E E N:


Applicant

- and -


Applicant

- and -


Respondent

NOTICE OF MOTIONOF EMMANUEL VILLAGE RESIDENCE INC.

Emmanuel Village Residence Inc. (“EVR”) will make a Motion to the court on

Wednesday, August 31 at 10:00 a.m. or as soon after that time as the Motion can be heard at the

court house, 330 University Avenue, 8th Floor, Toronto, Ontario, M5G 1R7.

PROPOSED METHOD OF HEARING: The Motion is to be heard orally.

THE MOTION IS FOR:

1. An order substantially in the form attached as Tab 3 in the Motion Record approving the

sale transaction (the "Transaction") contemplated by an agreement of purchase and sale (the

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"Sale Agreement") between the Company and Revera Inc. (the "Purchaser") dated August 12,

2016, and vesting in the Purchaser all of the Company’s right, title and interest in and to the assets

described in the Sale Agreement (the "Purchased Assets");

2. An order substantially in the form attached as Tab 4 in the Motion Record seeking the

following relief:

(a) if necessary, abridging the time for service and filing of this notice of motion and

the motion record and dispensing with further service thereof;

(b) approving the second report of BDO Canada Limited, in its capacity as

court-appointed receiver of EVR, dated August 18, 2016 (the “Second Report”),

filed, and the conduct and activities of the Receiver described therein;

(c) approving the third report of BDO Canada Limited, in its capacity as

court-appointed receiver of EVR, dated August 19, 2016 (the “Third Report”),

filed, and the conduct and activities of the Receiver described therein;

(d) approving the confidential report of BDO Canada Limited, in its capacity as

court-appointed receiver of EVR, dated August 19, 2016 (the “Confidential

Report”);

(e) sealing the Confidential Report with the Court;

(f) approving the professional fees and disbursements of the Receiver and its counsel,

Thornton Grout Finnigan LLP (“TGF”) as set out in the Third Report;

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(g) varying the Order of Justice Penny, dated June 24, 2016, to increase the first

priority administration charge by $350,000, to an aggregate of $700,000 as

described in more detail, below;

(h) approving a priority charge for the fees of Durham Capital Management O/A Sure

Mortgage ("Sure Mortgage") in the aggregate amount equal to the Brokerage Fee

due to Sure Mortgage, with the priority set out in more detail below; and

3. Such further and other relief as to this Honourable Court may seem just.

THE GROUNDS FOR THE MOTION ARE:

Background

(a) EVR is the owner and operator of Emmanuel Village in Kitchener, Ontario.

Emmanuel Village is a retirement community that houses between 110 and 130

residents and employs approximately 50 individuals.

(b) EVR was originally incorporated on October 25, 2001 with a view to acquiring

lands on which a retirement residence apartment building was being constructed.

Construction of Emmanuel Village began in the fall of 2001 and was completed in

March, 2003. Bryan has owned a controlling interest in the EVR, and thus

Emmanuel Village, since March, 2003, as set out below in more detail.

(c) On or about June 10, 2016, EVR commenced an application to appoint a receiver

for the limited purpose of completing a going concern sale of EVR’s business and

the assets, undertaking and property used in relation to the business, including all

proceeds thereof (collectively, the “Business”) to a purchaser who is licensed to

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carry on the Business as a retirement home at the Commercial List in Toronto under

Court File No.: CV-16-11424-00CL (the “Toronto Application”).

(d) The appointment of a receiver was both necessary and appropriate because of the

following:

(i) The principal of EVR pleaded guilty to a single count of fraud over $5,000

on or about April 22, 2015 and is currently being held in custody pending

his sentencing;

(ii) The Retirement Homes Regulatory Authority (“RHRA”) revoked EVR’s

license to operate a retirement home (“License”), mainly on the basis of the

fraud conviction;

(iii) The effective date of the revocation of EVR’s License is September 2,

2016;

(iv) As a result of the pending revocation of EVR’s License, EVR engaged Sure

Mortgage to conduct a sale process to sell the EVR Property (as defined

below) to another licensed entity; and

(v) That sale process resulted in the Purchaser submitting a letter of intent and a

deposit. The Purchaser requires an approval and vesting order as a

condition of any sale agreement.

(e) On or about June 10, 2016, the Attorney General of Ontario (the “AGO”)

commenced a civil forfeiture application in Kitchener, Ontario under Court File

-5-

No.: C-636-16 (the “Kitchener Application”) in respect of the property

municipally known as 1250 Weber Street East, Kitchener, Ontario, a portion of

which is owned by EVR (the “EVR Property”). Pursuant to the Kitchener

Application, the AGO sought and obtained a temporary preservation order under

the Civil Remedies Act that placed a “No Dealings” notation on title to the EVR

Property on an ex parte basis (the “Preservation Order”).

(f) The Preservation Order was subsequently amended by the Order of Justice Broad,

dated June 23, 2016, and extended to August 8, 2016 by the Order of Mr. Justice

Hainey on July 15, 2016.

(g) On June 24, 2016, EVR obtained an order appointing the Receiver in the Toronto

Application (the “Appointment Order”).

(h) On June 22, 2016, the Kitchener Application was transferred to Toronto by the

Order of Justice Newbould, and subsequently consolidated with the Toronto

Application by the Orders of Justice Conway in each of the Kitchener Application

and the Toronto Application to proceed as a single application on the Commercial

List.

(i) Pursuant to the Order of Justice Pattillo dated July 27, 2016, the parties obtained a

permanent preservation order under the Civil Remedies Act that continued the “No

Dealings” notation on title to the EVR Property.

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Approval of Sale Agreement

(j) On or about Friday, August 12, 2016, EVR entered into the Sale Agreement with

the Purchaser. The Transaction contemplated by the Sale Agreement is subject to a

Sale Approval Motion, as set out in the Appointment Order, to obtain an approval

and vesting order.

(k) The Sale Agreement is the result of a sale process conducted by Durham Capital

Management O/A Sure Mortgage ("Sure Mortgage"), through its principal owner,

Jeffrey Winters.

(l) A term of the agreement that EVR entered into with Sure Mortgage to conduct the

sale process entitles Sure Mortgage to a Sale Transaction Fee as a percentage of the

value of all cash, securities or other property paid, and including assumed debts and

liabilities, in connection with a sale transaction (the “Brokerage Fee”).

(m) Sure Mortgage and EVR, with the assistance of the Receiver, negotiated final terms

of sale with the Purchaser, as set out in the Sale Agreement, which was executed on

August 12, 2016.

(n) The Sale Agreement contemplates a closing date of October 3, 2016, and requires

court approval.

(o) EVR believes that the Sale Agreement is in the best interest of the stakeholders of

EVR and that the process leading to the Sale Agreement was reasonable in the

circumstances.

(p) The Receiver supports the closing of the Sale Agreement.

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Sealing Order

(q) The Confidential Report contains commercially sensitive information which in the

Receiver’s view should be sealed pending further order of this Court as the release

of this information could prejudice the stakeholders of EVR, particularly if the

transaction contemplated by the Sale Agreement does not close.

Administration Charge

(r) The “Professional Group”, comprising the Receiver, counsel to the Receiver,

TGF, counsel to EVR, Madorin Snyder LLP (“Madorin Snyder”) and DLA Piper

(Canada) LLP (“DLA Piper”), and representative counsel to the EVH Residents,

Oldfield, Greaves, D’Agostino (“Representative Counsel”), seeks to increase

their priority charge against the assets, undertakings and property (including all real

and personal property) of EVR to an aggregate amount of $700,000 to secure

payment of professional fees and disbursements incurred in these proceeding,

including with respect to the fees and disbursements of the Receiver, TGF,

Madorin Snyder, DLA Piper, and Representative Counsel incurred in the

preparation and filing materials in these proceedings (the “Administration

Charge”).

(s) The proposed increase to the Administration Charge will be fully subordinate to all

security interests, trusts, liens charges and encumbrances, claims of secured

creditors, statutory or otherwise (collectively “Encumbrances”) in favour of HMT

Holdings Inc., but shall rank in priority to all other Encumbrances in favour of any

person.

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(t) The continuing services to be provided by the Professional Group are essential to a

successful completion of the sale transaction up to and including the closing of the

sale, which is anticipated to occur in October, 2016.

(u) EVR’s cash-flows is such that they will be unable to satisfy the reasonable fees and

disbursements of the Professional Group as they are incurred.

(v) It is unlikely that the Professional Group will continue to participate in these

proceedings unless their reasonable fees and disbursements are secured by way of

the proposed increase to the Administration Charge.

(w) The quantum of the increase of the Administration Charge is reasonable given the

nature and scope of the services to be provided, the inability of EVR to fund

professional charges from free cash-flow, the complexity of these proceedings,

including the interplay of the receivership and the civil forfeiture applications, and

the expected duration of the period that the Administration Charge will cover.

Brokerage Charge

(x) The Sale Agreement is largely the result of the efforts of Sure Mortgage, which was

essential to the sales process. It is reasonable, fair and equitable that a key

contributor to the generation of sale proceeds be paid its fees for doing so.

(y) EVR’s cash-flow is such that EVR is unable to fund the Brokerage Fee. As a result,

a priority charge for the Brokerage Fee (the “Brokerage Charge”) is both

necessary and appropriate to ensure that Sure Mortgage is compensated for the

work that is has done, which has resulted in the Sale Agreement.

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(z) The Brokerage Charge would be fully subordinate to the Encumbrances (as defined

in the Appointment Order) in favour of HMT Holdings Inc., the Administration

Charge, and the prior Encumbrance registered in favour of Sure Mortgage.

(aa) EVR and the Receiver support the Brokerage Charge.

(bb) The quantum of the Brokerage Charge is commercially reasonable, under the

circumstances.

(cc) The fees and disbursements of the Receiver and its counsel are reasonable in the

circumstances.

(dd) Such further and other grounds as the lawyers may advise.

4. The following documentary evidence will be used at the hearing of the application:

(a) The affidavit of Judith Ann Hunking, sworn August 19, 2016;

(b) The Third Report;

(c) The Confidential Report; and

(d) such further and other evidence as the lawyers may advise and this Honourable

Court may permit.

-10-

August 19, 2016 DLA PIPER (CANADA) LLPBarristers & Solicitors1 First Canadian Place100 King Street West, Suite 6000P.O. Box 367Toronto ON M5X 1E2

Bruce Darlington (LSUC# 25310K)Tel: 416-365-3529Fax: [email protected]

Jennifer A. Whincup (LSUC# 60326W)Tel: 416-365-3425Fax: [email protected]

Lawyers for Emmanuel Village Residence Inc.

TO: Attached Service List

CAN: 21934684.1

SERVICE LIST



Tel: 416-304-0060Fax: 416-304-1313


Tel: 416-304-0595Fax: 416-304-1313




Tel: 416-777-5413Fax: 1-888-587-9143




Tel: 416-597-6489Fax: 416-597-9922


- 2 -

CAN: 21934684.1



Tel: 416-777-6511Fax: 416-863-1716


Tel: 416-777-4828Fax: 416-863-1716




Tel: 416-214-5881Fax: 416-314-3714


Tel: 416-327-2932Fax: 416-314-3714


Tel: 416-326-2704Fax: 416-326-4181


- 3 -

CAN: 21934684.1



Tel: 416-973-3172Fax: 416-973-0810




Tel: 905-433-6934Fax: 905-436-4510



Tel: 416-487-1223Fax: 416-440-3570

- 4 -

CAN: 21934684.1



Tel: 416-225-8750x262Fax: 416-225-7214



Secured Party



Tel: 519-576-7200Fax: 519-576-0131



Tel: 519-741-2450

- 5 -

CAN: 21934684.1



Tel: 519-575-7525Fax: 519-571-5025







- 6 -

CAN: 21934684.1



Tel: 416-597-4211Fax: 416-979-1234


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TAB 2

CAN: 21934684.1

SERVICE LIST



Tel: 416-304-0060Fax: 416-304-1313


Tel: 416-304-0595Fax: 416-304-1313




Tel: 416-777-5413Fax: 1-888-587-9143




Tel: 416-597-6489Fax: 416-597-9922


- 2 -

CAN: 21934684.1



Tel: 416-777-6511Fax: 416-863-1716


Tel: 416-777-4828Fax: 416-863-1716




Tel: 416-214-5881Fax: 416-314-3714


Tel: 416-327-2932Fax: 416-314-3714


Tel: 416-326-2704Fax: 416-326-4181


- 3 -

CAN: 21934684.1



Tel: 416-973-3172Fax: 416-973-0810




Tel: 905-433-6934Fax: 905-436-4510



Tel: 416-487-1223Fax: 416-440-3570

- 4 -

CAN: 21934684.1



Tel: 416-225-8750x262Fax: 416-225-7214



Secured Party



Tel: 519-576-7200Fax: 519-576-0131



Tel: 519-741-2450

- 5 -

CAN: 21934684.1



Tel: 519-575-7525Fax: 519-571-5025







- 6 -

CAN: 21934684.1



Tel: 416-597-4211Fax: 416-979-1234


TAB A

TAB B

TAB C

TAB D

TAB E

TAB F

TAB G

TAB H

TAB 3

Court File No. CV-16-11424-00CL

ONTARIO

SUPERIOR COURT OF JUSTICE

COMMERCIAL LIST

THE HONOURABLE

JUSTICE

)

)

)

WEDNESDAY, THE 31ST

DAY OF AUGUST, 2016

B E T W E E N:


Applicant

- and -


Applicant

- and -

1250 WEBER STREET EAST, KITCHENER, ONTARIO OR THE PROCEEDS OF THE SALE THEREOF (IN REM)

Respondent

APPROVAL AND VESTING ORDER(Sale to Revera Inc.)

THIS MOTION, made by Emmanuel Village Residence Inc. (the “Company”) for an

order approving the sale transaction (the "Transaction") contemplated by an agreement of

purchase and sale (the "Sale Agreement") between the Company and Revera Inc. (the

"Purchaser") dated August 12, 2016, and vesting in the Purchaser all of the Company’s right,

title and interest in and to the assets described in the Sale Agreement (the "Purchased Assets"),

was heard this day at 330 University Avenue, Toronto, Ontario.

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ON READING the affidavit of Judith Ann Hunking, sworn August 19, 2016 (the

“Hunking Affidavit”) and the Report of BDO Canada Limited, in its capacity as the Court-

appointed receiver (the "Receiver") of the undertaking, property and assets of the Company,

dated August 19, 2016 (the “Report”), and on hearing the submissions of counsel for the

Company, the Receiver, the Purchaser, HMT Holdings Inc., Sure Mortgage Capital Inc.,

Plaintiffs in Court File No. CV-10-8597-00CL, the Retirement Homes Regulatory Authority, and

the Attorney General of Ontario (“AGO”), no one appearing for any other person on the service

list, although properly served as appears from the affidavit of Kim Hamill sworn August 22,

2016 filed,

1. THIS COURT ORDERS AND DECLARES that the Transaction is hereby approved,

and the execution of the Sale Agreement by the Company is hereby authorized and approved,

with such minor amendments as the Company may deem necessary, with the approval of the

Receiver. The Company and the Receiver are hereby authorized and directed to take such

additional steps and execute such additional documents as may be necessary or desirable for the

completion of the Transaction and for the conveyance of the Purchased Assets to the Purchaser.

2. THIS COURT ORDERS AND DECLARES that, upon the delivery of a Receiver’s

certificate to the Purchaser substantially in the form attached as Schedule A hereto (the

"Receiver's Certificate"), all of the Debtor's right, title and interest in and to the Purchased

Assets described in the Sale Agreement (including without limitation the real property identified

in Schedule B hereto) shall vest absolutely in the Purchaser, free and clear of and from any and

all security interests (whether contractual, statutory, or otherwise), hypothecs, mortgages, trusts

or deemed trusts (whether contractual, statutory, or otherwise), liens, executions, levies, charges,

or other financial or monetary claims, whether or not they have attached or been perfected,

registered or filed and whether secured, unsecured or otherwise (collectively, the "Claims")

including, without limiting the generality of the foregoing: (i) any encumbrances or charges

created by the Order of the Honourable Justice Penny dated June 24, 2016; (ii) any

encumbrances, charges, restrictions or rights in favour of the AGO either under the Order of the

Honourable Justice Sloan dated June 16, 2016 in Superior Court of Justice File No. C-636-16 (as

amended by Order of Justice D.A. Broad dated June 23, 2016, as amended and extended by

Order of the Honourable Justice Hainey dated July 15, 2016, as transferred to the Commercial

List by Order of the Honourable Justice Newbould dated July 22, 2016 and as consolidated into

- 3 -

these proceedings by Order of the Honourable Justice Conway dated July 22, 2016) or under the

Order of the Honourable Justice Pattillo dated July 27, 2016 in these proceedings; (iii) all

charges, security interests or claims evidenced by registrations pursuant to the Personal Property

Security Act (Ontario) or any other personal property registry system, including without

limitation those items referenced in Schedule E hereto; (iv) those Claims listed on Schedule C

hereto (all of which are collectively referred to as the "Encumbrances", which term shall not

include the permitted encumbrances, easements and restrictive covenants listed on Schedule D);

and (v) any and all rights which any owner of a lifelease at Emmanuel Village Homes Inc. may

have to receive any services or amenities from the Company, and, for greater certainty, this

Court orders that all of the Encumbrances affecting or relating to the Purchased Assets are

hereby expunged and discharged as against the Purchased Assets.

3. THIS COURT ORDERS that, upon the registration in Land Titles Division of Waterloo

(No. 58) of an Application for Vesting Order in the form prescribed by the Land Titles Act, the

Land Registrar for the Land Titles Division of Waterloo (No. 58) is hereby directed to enter the

Purchaser as the owner of the subject real property identified in Schedule B hereto (the “Real

Property”) in fee simple, and is hereby directed to delete and expunge from title to the Real

Property all of the Claims listed in Schedule C hereto.

4. THIS COURT ORDERS that the registration of this Order on title to the Real Property

is not prohibited by any of the previously registered “no dealings” indicators or other restrictions,

including without limitation those in any of Instrument No. WR959399, Instrument No.

WR961087, Instrument No. WR966314, Instrument No. WR967194 or Instrument

No.WR970673, each of which instruments is listed in Schedule C hereto.

5. THIS COURT ORDERS that, for the purposes of determining the nature and priority of

Claims, the net proceeds from the sale of the Purchased Assets shall stand in the place and stead

of the Purchased Assets, and that from and after the delivery of the Receiver's Certificate all

Claims and Encumbrances shall attach to the net proceeds from the sale of the Purchased Assets

with the same priority as they had with respect to the Purchased Assets immediately prior to the

sale, as if the Purchased Assets had not been sold and remained in the possession or control of

the person having that possession or control immediately prior to the sale.

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6. THIS COURT ORDERS AND DIRECTS the Receiver to file with the Court a copy of

the Receiver's Certificate, forthwith after delivery thereof.

7. THIS COURT ORDERS that, pursuant to clause 7(3)(c) of the Canada Personal

Information Protection and Electronic Documents Act, the Company is authorized and permitted

to disclose and transfer to the Purchaser all human resources and payroll information in the

Company's records pertaining to the Company's past and current employees, including personal

information of those employees listed on Schedule "9.1" to the Sale Agreement. The Purchaser

shall maintain and protect the privacy of such information and shall be entitled to use the

personal information provided to it in a manner which is in all material respects identical to the

prior use of such information by the Company.

8. THIS COURT ORDERS that, notwithstanding:

(a) the pendency of these proceedings;

(b) any applications for a bankruptcy order now or hereafter issued pursuant to the

Bankruptcy and Insolvency Act (Canada) in respect of the Company and any

bankruptcy order issued pursuant to any such applications; and

(c) any assignment in bankruptcy made in respect of the Company;

the vesting of the Purchased Assets in the Purchaser pursuant to this Order shall be binding on

any trustee in bankruptcy that may be appointed in respect of the Company and shall not be void

or voidable by creditors of the Company, nor shall it constitute nor be deemed to be a fraudulent

preference, assignment, fraudulent conveyance, transfer at undervalue, or other reviewable

transaction under the Bankruptcy and Insolvency Act (Canada) or any other applicable federal or

provincial legislation, nor shall it constitute oppressive or unfairly prejudicial conduct pursuant

to any applicable federal or provincial legislation.

9. THIS COURT ORDERS AND DECLARES that the Transaction is exempt from the

application of the Bulk Sales Act (Ontario).

- 5 -

10. THIS COURT HEREBY REQUESTS the aid and recognition of any court, tribunal,

regulatory or administrative body having jurisdiction in Canada or in the United States to give

effect to this Order and to assist the Receiver and its agents in carrying out the terms of this

Order. All courts, tribunals, regulatory and administrative bodies are hereby respectfully

requested to make such orders and to provide such assistance to the Receiver, as an officer of this

Court, as may be necessary or desirable to give effect to this Order or to assist the Receiver and

its agents in carrying out the terms of this Order.

___________________________________

Schedule A – Form of Receiver’s Certificate


ONTARIO


COMMERCIAL LIST

B E T W E E N:


Applicant

- and –


Respondent

RECEIVER’S CERTIFICATE

RECITALS

A. Pursuant to an Order of the Honourable Justice Penny of the Ontario Superior Court of

Justice (the "Court") dated June 24, 2014, BDO Canada Limited was appointed as the receiver

(the "Receiver") of the undertaking, property and assets of Emmanuel Village Residence Inc.

(the “Company”).

B. Pursuant to an Order of the Court dated [DATE], the Court approved the agreement of

purchase and sale made as of [DATE OF AGREEMENT] (the "Sale Agreement") between the

Company and Revera Inc. (the "Purchaser") and provided for the vesting in the Purchaser of the

Company’s right, title and interest in and to the Purchased Assets, which vesting is to be

effective with respect to the Purchased Assets upon the delivery by the Receiver to the Purchaser

of a certificate confirming (i) the payment by the Purchaser of the Purchase Price for the

Purchased Assets; (ii) that the conditions to Closing as set out in section ● of the Sale Agreement

- 2 -

have been satisfied or waived by the Company and the Purchaser; and (iii) the Transaction has

been completed to the satisfaction of the Receiver.

C. Unless otherwise indicated herein, terms with initial capitals have the meanings set out in

the Sale Agreement.

THE RECEIVER CERTIFIES the following:

1. The Purchaser has paid and the Receiver has received the Purchase Price for the

Purchased Assets payable on the Closing Date pursuant to the Sale Agreement;

2. The conditions to Closing as set out in section ● of the Sale Agreement have been

satisfied or waived by the Company and the Purchaser; and

3. The Transaction has been completed to the satisfaction of the Receiver.

4. This Certificate was delivered by the Receiver at ________ [TIME] on _______ [DATE].

BDO CANADA LIMITED, in its capacity as Receiver of the undertaking, property and assets of Emmanuel Village Residence Inc., and not in its personal capacity

Per:

Name:

Title:

Schedule B – Real Property Legal Description

Municipal Description: 1250 Weber Street East, Kitchener, Ontario

Legal Description: LT 75-81 PL 322 TWP OF WATERLOO; PT LT 38-43, 51-56, 74, 82-85 PL 322 TWP OF WATERLOO; PT LT 2 PL 963 KITCHENER, PT LT 141 STREETS AND LANES KITCHENER; PT LT 142 STREETS & LANES KITCHENER (FORMERLY PT HERMAN AV & PT AUBURN AV PL 322, CLOSED BY 210008) PT 1, 2, 3, 4, 5, 6, 7, 58R13759; S/T & T/W 1566343; S/T 1404828, 1559347, 1563157; KITCHENER

PIN: 22565-0352 (LT)

Schedule C – Claims to be deleted and expunged from title to Real Property

1. Instrument No. WR608571, registered April 15, 2011 being an Application for Court Order;

2. Instrument No. WR608873, registered April 18, 2011 being an Application for Court Order;

3. Instrument No. WR821198, registered June 12, 2014 being a charge in favour of HMT Holdings Inc.;

4. Instrument No. WR821199, registered June 12, 2014 being a notice of assignment of rents – general in favour of HMT Holdings Inc.;

5. Instrument No. WR821246, registered June 12, 2014 being a charge in favour of Sure Mortgage Capital Inc.;

6. Instrument No. WR821247, registered June 12, 2014 being a notice of assignment of rents – general in favour of Sure Mortgage Capital Inc.;

7. Instrument No. WR938102, registered February 25, 2016 being notice of terms amending the charge registered as Instrument No. WR821198;

8. Instrument No. WR959399, registered June 16, 2016 being an Application for Restrictions Based on Court Order;

9. Instrument No. WR961087, registered June 24, 2016 being an Application for Restrictions Based on Court Order;

10. Instrument No. WR966314, registered July 15, 2016 being an Application for Restrictions Based on Court Order;

11. Instrument No. WR967194, registered July 20, 2016 being an Application for Court Order; and

12. Instrument No. WR970673, registered August 3, 2016 being an Application for Restrictions Based on Court Order.

Schedule D – Permitted Encumbrances, Easements and Restrictive Covenantsrelated to the Real Property (unaffected by the Vesting Order)

Schedule E – Personal Property Security Act (Ontario) Registrations to be vested out

Secured Party(ies) Debtor(s)

Reference File No. & Registration Number (Registration Period)

Collateral Classification

Amendments/AssignmentsDischarges/RenewalsTransfers/Subordinations

1. Sure Mortgage Capital Inc.

Emmanuel Village Residence Inc.

697063815 –20140612 1336 2067 1330 (5 years)

Inventory, Equipment, Accounts, Other

2. HMT Holdings Inc. in Trust

Emmanuel Village Residence Inc.

696941451 –20140609 1503 1590 3885 (3 years)

Inventory, Equipment, Accounts, Other, Motor Vehicles

Renewed by 20160212 1049 1590 3257

1 year

3. Bank of Nova Scotia – Ontario CAU

Emmanuel Village Residence Inc

679485213 –20120626 1705 1219 2809 (5 years)

Other, Motor Vehicles, Amount Secured: $24,444, 2012 Dodge Grand Caravan, VIN listed

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ONTARIO


COMMERCIAL LIST

THE HONOURABLE

JUSTICE

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WEDNESDAY, THE 31ST

DAY OF AUGUST, 2016

B E T W E E N:


Applicant

- and -


Applicant

- and -

1250 WEBER STREET EAST, KITCHENER, ONTARIO OR THE PROCEEDS OF THE SALE THEREOF (IN REM)

Respondent

ANCILLARY ORDER

THIS MOTION made by Emmanuel Village Residence Inc. (“EVR”) for an order:

a. if necessary, abridging the time for service and filing of this notice of motion and

the motion record and dispensing with further service thereof;

b. approving the second report of BDO Canada Limited, in its capacity as court-

appointed receiver of EVR (“Receiver”), dated August 18, 2016 (the “Second

Report”), filed, and the conduct and activities of the Receiver described therein;

c. approving the third report of the Receiver (the “Third Report”) and the

confidential supplement to the Third Report (the “Confidential Report”), filed,

and the conduct and activities of the Receiver described therein;

d. sealing the Confidential Report with the Court;

e. approving the professional fees and disbursements of the Receiver and its counsel,

Thornton Grout Finnigan LLP (“TGF”) as set out in the Third Report;

f. varying the Order of Justice Penny, dated June 24, 2016, to increase the first

priority administration charge by $350,000, to an aggregate of $700,000 as

described in more detail, below; and

g. approving a priority charge for the fees of Durham Capital Management O/A Sure

Mortgage ("Sure Mortgage") in the aggregate amount equal to the Brokerage Fee

due to Sure Mortgage, with the priority set out in more detail below,

was heard this day at 330 University Avenue, Toronto, Ontario.

ON READING the affidavit of Judith Ann Hunking, sworn August 19, 2016, the Third

Report and the Confidential Report, and on hearing the submissions of counsel for the Company,

the Receiver, the Purchaser, HMT Holdings Inc., Sure Mortgage Capital Inc., Plaintiffs in Court

File No. CV-10-8597-00CL, the Retirement Homes Regulatory Authority, and the Attorney

General of Ontario (“AGO”), no one appearing for any other person on the service list, although

properly served as appears from the affidavit of Kim Hamill sworn August 22, 2016 filed,

SERVICE

1. THIS COURT ORDERS that the time for service of the Notice of Motion and the

Motion is hereby abridged and validated so that this motion is properly returnable today and

hereby dispenses with further service thereof.

APPROVAL OF RECEIVERS REPORTS

2. THIS COURT ORDERS that the activities of the Receiver, as set out in the Second

Report, Third Report and Confidential Report, are hereby approved.

APPROVAL OF FEES

3. THIS COURT ORDERS that the fees and disbursements of the Receiver, in the amount

of $ for the period of June , 2017 to August , 2016 as se set out in the Third Report and the

Affidavit of , sworn August , 2016, are hereby approved.

4. THIS COURT ORDERS that the fees and disbursements of the Receiver’s counsel,

Thornton Grout Finnigan LLP, in the amount of $ for the period of June , 2017 to August ,

2016 as se set out in the Third Report and the Affidavit of , sworn August , 2016, are hereby

approved.

SEALING OF CONFIDENTIAL REPORT

5. THIS COURT ORDERS the sealing of the Confidential Report with the Court from the

public record until further order of this Honourable Court.

ADMINISTRATION CHARGE

6. THIS COURT ORDERS that paragraph 27 of the order in these proceedings of Justice

Penny, dated June 24, 2016 (the “Appointment Order”) is varied such that the Administration

Charge (as defined therein) shall not exceed an aggregate amount of $700,000.

7. THIS COURT ORDERS that paragraph 29(b) of the Appointment Order is varied such

that the remainder of the Administration charge (as defined therein), being $500,000, shall be

fully subordinate to Encumbrances (as defined therein) in favour of HMT Holdings Inc., but

shall rank in priority to all other Encumbrances in favour of any person.

BROKERAGE CHARGE

8. THIS COURT ORDERS that Sure Mortgage shall be paid its reasonable fees and

disbursements upon the successful closing of the transaction contemplated by the agreement

between EVR and Revera Inc. dated August 12, 2016, as set out in the agreement between Sure

Mortgage and EVR dated March 3, 2016.

9. THIS COURT ORDERS that Sure Mortgage shall be entitled to the benefit of and is

hereby granted a charge (the “Brokerage Charge”) on the current and future assets,

undertakings and properties of EVR, of every nature and kind whatsoever (including all real and

personal property), and wherever situate including all proceeds thereof, which charge shall not

exceed an aggregate amount equal to the Brokerage Fee as security for the Brokerage Fee.

10. THIS COURT ORDERS that the filing, registration or perfection of the Brokerage

Charge shall not be required and that the Brokerage Charge shall be valid and enforceable for all

purposes, including as against any right, title or interest filed, registered, recorded or perfected

subsequent to the Brokerage Charge coming into existence, notwithstanding any such failure to

file, register, record or perfect.

11. THIS COURT ORDERS that the Brokerage Charge shall constitute a charge on the

Property, and shall be fully subordinate to all security interests, trusts, liens, charges and

encumbrances, claims of secured creditors, statutory or otherwise (collectively,

"Encumbrances") in favour of:

(a) HMT Holdings Inc.;

(b) the Professional Group (as defined in the Appointment Order); and

(c) Sure Mortgage;

but shall rank in priority to all other Encumbrances in favour of any Person.

___________________________________

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