ONTARIO SUPERIOR COURT OF JUSTICE - BDO Canada · Toronto, Ontario M5K 1 G8 Vern W. Dane (LSUC# 32591 E) Tel: 416-941-8842 ... approving the amended or discounted real estate commission

Court File No. CV-16-11565-OOCL

BETWEEN:

ONTARIOSUPERIOR COURT OF JUSTICE

(COMMERCIAL LIST)

SIDNEY STREET PROPERTIES CORP.

Applicant

-and-

2428049 ONTARIO INC.

Respondent

MOTION RECORD(Returnable August 3, 2017)

July 27, 2017 FOGLER, RUBINOFF LLPLawyers77 King Street WestSuite 3000, P.O. Box 95TD CentreToronto, Ontario M5K 1 G8

Vern W. Dane (LSUC# 32591 E)Tel: 416-941-8842Fax: 416-941-8852

Lawyers for the court-appointed Receiverof the Respondent, BDO Canada Limited

TO: Service List

SERVICE LIST(Updated on July 27, 2017)

TO: 2428049 ONTARIO INC.

904 County Road 11

Napanee, Ontario K7R 3L2

KARL HOLLETT (President)

cc: Civis Law LLP, 36 Toronto Street, Suite 850, Toronto, Ontario M5C 2CSAttention Jeffrey J. Kroeker (email: jkroeker(c~civislaw.ca)

AND TO: BALDWIN LAW Professional Corporation

54 Victoria Avenue

P.O. Box 1537

Belleville, Ontario K8N 5J2

IAN W. BRADY/GREGORY PARKER

Tel: 613-771-9991

Fax: 613-771-9998

Email: ibradvC~baldwinlaw.ca / gparker(a~baldwinlaw.ca

Lawyers for the Applicant, Sidney Street Properties Corp.

AND TO: BAKER & McKENZIE LLP

181 Bay Street

Suite 2100

Toronto, Ontario M5J 2T3

KENT BEATTIE

Tel: 416.865.2304

Fax: 416.863.6275

Email: kent.beattieCa.bakermckenzie.com

Lawyers for Avaya Canada Corp.

AND TO: JUSTICE CANADA

Tax Section

130 King Street West

Suite 3400, P.O. Box 36, Exchange Tower

Toronto, Ontario M5X 1 K6

DIANE H.A. WINTERS

Tel: 416-973-3172

Fax: 416-973-0810

Email: [email protected]

AND TO: MINISTRY OF FINANCE

Legal Services Branch

33 King Street West, 6th Floor

Oshawa, Ontario L1 H 8H5

KEVIN O'HARA

Email: Kevin.ohara(c~ontario.ca

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AND TO: DAVIES WARD PHILLIPS 8~ VINEBERG LLP ''

155 Wellington Street West

Toronto, Ontario M5V 3J7

ALEXANDRIA J. PIKE

Tel: 416-367-6989

Fax: 416-597-4194

Email: apike(c.~dwpv.com

Lawyers for Nortel Networks Limited

AND TO: TEMPLEMAN MENNINGA LLP

205 Dundas Street East

Suite 200

Belleville, Ontario K8N 5A2

DAVID W. DEMILLE /TODD STORMS

Tel: 613-966-2620

Fax: 613-966-2866

Email: dwd(a~tmlegal.ca

Lawyers for the Corporation of the City of Belleville

AND TO: GOODMANS LLP

333 Bay Street

Suite 3400, Bay Adelaide Centre

Toronto, Ontario M5H 2S7

JAY CARFAGNINI /JOSEPH PASQUARIELLO /CHRIS ARMSTRONG

Tel: 416-597-4107

Fax: 416-979-1234

Email: [email protected] / Ipasquariello(a~goodmans.ca /carmstrong(c~goodmans.ca

Lawyers for the Monitor in Nortels' CCAA proceedings, Ernst &Young Inc.

AND TO: BORDEN LADNER GERVAIS LLP

22 Adelaide Street West

Bay Adelaide Centre

Toronto, Ontario M5H 4E3

JAMES W. MACLELLAN

Tel: 416 367-6592

Fax: 416 367-6749

Email: jmaclellan(c(c~blg.com

Lawyers for Trisura Guarantee Insurance Company

AND TO: RCAP LEASING INC.

5575 North Service Rd., Suite 300

Burlington, Ontario L7L 6M1

LAURA POLLOCK (Collections Officer)

Email: reap.collections(c~rcapleasinq.com

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AND TO: LIPMAN, ZENER & WAXMAN

1220 Eglinton Avenue West

Toronto, Ontario M6C 2E3

ANTHONY O'BRIEN

Tel: 416-789-0652

Fax: 416-789-9015

Email: tobrien Izwlaw.com

Lawyers for Business Development Bank of Canada

AND TO: ATTORNEY GENERAL FOR ONTARIO

Ministry of the Environment and Climate Change

Legal Services Branch

135 St. Clair Avenue West, 10th Floor

Toronto, Ontario M4V 1 P5

PAUL MCCULLOCH

Tel: 613-521-3450 x234

Fax: 416-314-6579

Email: PauI.McCulloch(c~ontario.ca

DANIELLE MEULEMAN

Tel: 416-314-7605

Fax: 416-314-6579

Email: danielle.meuleman(c~ontario.ca

Lawyers for Her Majesty the Queen in Right of Ontario, as represented by the Ministry ofthe Environment

AND TO: MINDEN GROSS LLP

145 King Street West

Suite 2200

Toronto, Ontario M5H 4G2

RACHEL MOSES

Tel: 416-369-4115

Fax: 416-864-9223

Email: rmoses ,mindengross.com

Lawyers for Royal Bank of Canada

AND TO: O'FLYNN WEESE LLP

65 Bridge Street East

Belleville, Ontario

K8N 1 L8

JOHN MASTORAKOS

Tel: 613-966-5222

Fax: 613-961-7991

Email: jmastorakos(c~owtlaw.com

Lawyers for Hamilton Smith Limited

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AND TO: DICKINSON WRIGHT LLP

199 Bay Street

Suite 2200

Toronto, Ontario M5L 1 G4

MICHAEL J. BRZEZINSKI

Tel: 416-777-2394

Fax: 844-670-6009

Email: mbrzezinski(u~dickinsonwright.com

Lawyers for Fuller Landau LLP, Court-appointed receiver of Strathcona Energy Group Inc.and Fath PV Tech Inc.

AND TO: msi Spergel inc.

Licensed Insolvency Trustee

505 Consumers Road, Suite 200

Toronto, Ontario M2J 4V8

PHILIP H. GENNIS

Tel: 416-498-4325

Fax: 416-498-4325

Email: ~gennis ,spergel.ca

Private Receiver of Strathcona Energy Group Inc. and Fath PV Tech Inc.

AND TO: SYSCO CANADA, INC., c.o.b. as Sysco Central Ontario

63 Elmdale Rd., R.R. #3

Peterborough, Ontario

K9J 7B1

AND TO: Leonard de Vries

Barrister &Solicitor

5255 Yonge Street, Suite 1300,

Toronto, Ontario

M2N 6P4

Tel: (416) 924-8082

Fax: (416) 927-0305

Email: devries(a~on.aibn.com

Lawyer for Prospective Purchaser



(COMMERCIAL LIST)

BETWEEN:


/• • •

- and


Respondent

INDEX

TAB DOCUMENT

1 Notice of Motion (Returnable August 3, 2017)

2 Second Report of the Receiver dated July 27, 2017

A Receivership Order of Justice Penny dated December 13, 2016

B Receiver's First Report dated January 30, 2017 (excluding appendices)

C Order of Justice Hainey dated February 9, 2017

D Listing Agreement

E Commission Invoice

F Security Opinion of Fogier, Rubinoff LLP dated July 19, 2017

G Property Tax Statements

H CRA Property Claim — Payroii Source Deductions

CRA Notice of Assessment —HST

J CRA Auditor's HST Arrears Schedule

K Hamilton Smith Limited Judgement dated July 12, 2016

L Receiver's R&D Statement

M BDO Canada Limited Fee Affidavit

N Fogler, Rubinoff LLP Fee Affidavit

CONFIDENTIAL APPENDICES

(Confidential) Offer to Purchase dated June 1, 2017 (including amendments)

2 (Confidential) Key Financial Terms of Sale Agreement

3 Draft Approval and Vesting Order

4 Modei Approval and Vesting Order (Blacklined)

5 Draft Discharge Order

.~ '



(COMMERCIAL LIST]

BETWEEN:


Applicant

- and-


Respondent

NOTICE OF MOTION(Returnable August 3, 2017)

BDO Canada Limited, the court-appointed receiver (the "Receiver") of the

property, assets and undertakings of 2428049 Ontario Inc. (the "Debtor"), will make a motion to

the Court on Thursday, August 3, 2017 at 10:00 a.m., or as soon after that time as the motion

can be heard at 330 University Avenue, 8th Floor, Toronto, Ontario.

THE PROPOSED METHOD OF HEARING:

The motion is to be heard orally.

THE MOTION IS FOR an order:

1. validating the service of this Notice of Motion, the Motion Record and the Second Report

of the Receiver dated July 27, 2017 (the "Second Report") so that this Motion is

properly returnable August 3, 2017 and dispensing with further service thereof;

2. approving the Second Report and the activities of the Receiver as described therein;

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3. approving the sale transaction regarding the real property of the Debtor located at 250

Sidney Street, Belleville, Ontario (the "Belleville Property") contemplated by the Offer

to Purchase fully executed on June 1, 2017, as amended (the "Sale Agreement")

between the Receiver and Toronto Capital Corp. (as it so assigns) (the "Purchaser")

and accepted by Sidney Street Properties Corp., Rentx Properties Corp. and Rentx

Transportation Services Corp., and upon closing the sale transaction pursuant to the

Sale Agreement, vesting in the Purchaser the Debtor's right, title and interest in and to

the assets or property described in the Sale Agreement, free and clear of any claims and

encumbrances except for permitted encumbrances;

4. approving the sealing of Confidential Appendices "1" and "2" to the Second Report until

the closing of the sale transaction or further order of this Court;

5. approving the amended or discounted real estate commission with respect to the sale

transaction under the Sale Agreement;

6. approving the Receiver's Statement of Receipts and Disbursements included in the

Second Report;

7. approving the fees and disbursements of the Receiver and its counsel and the

Professional Fee Reserve as set out in the Second Report;

8. subject to the payment of certain remaining items including outstanding property taxes,

WEPPA, Receiver's Borrowing Certificates and appropriate reserves or holdbacks being

maintained by the Receiver from the cash at hand to pay all outstanding and future

professional fees, authorizing and directing the Receiver to make a distribution of any

remaining funds in its possession to the Canada Revenue Agency ("CRA") in respect of

its deemed trust claims, as described in the Second Report;

9. discharging and releasing BDO Canada Limited as Receiver of the Respondent; and

10. such further relief as is just.

THE GROUNDS FOR THE MOTION ARE:

1. Pursuant to the Order (appointing Receiver) of the Court dated December 13, 2016 (the

"Receivership Order"), BDO Canada Limited was appointed Receiver with limited

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powers and duties with respect to the assets, property and undertakings of the Debtor

(the "Property");

2. The Receivership Order authorizes the Receiver to, inter alia, market and sell the

Belleville Property, including advertising and soliciting offers in respect of the Belleville

Property or any part or parts thereof and negotiating such terms and conditions of sale

as the Receiver in its discretion may deem appropriate; and apply for any vesting order

to convey the Belleville Property (s. 3(c), (d) and (e));

3. The Sale Agreement includes a condition that the Receiver must apply to the Court and

obtain an order approving the sale transaction and vesting the purchased assets or

property in the Purchaser generally free of ail claims and encumbrances;

4. The Receiver recommends the sale of the Belleville Property to the Purchaser as

described in the Second Report;

5. The Debtor's major creditor or first mortgagee, Sidney Street Properties Corp., supports

or does not oppose the proposed sale of the Belleville Property to the Purchaser;

6. Upon completion of the sale of the Belleville Property on or before August 10, 2017

pursuant to the Sale Agreement, there will be no or few other assets or property of the

Debtor of realizable value that need to be considered or dealt with by the Receiver;

7. After the sale of the Belleville Property pursuant to the Sale Agreement, the Receiver will

be in a position to complete and conclude the administration of this receivership;

8. Subject to the payment of certain remaining items including outstanding property taxes,

WEPPA, Receiver's Borrowing Certificates and appropriate reserves or holdbacks being

maintained by the Receiver from the cash at hand to pay all outstanding and future

professional fees as described in the Second Report, any net funds or funds remaining

wii~ be distributed to the CRA;

9. the Applicant is supportive of the discharge of the Receiver; and

10. Such further grounds as are just.

~~

THE FOLLOWING DOCUMENTARY EVIDENCE will be used at the hearing of the Motion:

1. the Second Report of the Receiver; and

2. such further and other materials as counsel may advise and this Honourable Court may

permit.

Date: July 27, 2017 FOGLER, RUBINOFF LLPLawyers77 King Street WestSuite 3000, P.O. Box 95TD CentreToronto, Ontario M5K 1 G8

Vern W. Dane (LSUC# 32591 E)Tei: 416-941-8842Fax: 416-941-8852


TO: Service List

SIDNEY STREET PROPERTIES CORP. -and - 2428049 ONTARIO INC.

Applicant Respondent



(COMMERCIAL LIST)

Proceedings commenced at Toronto

NOTICE OF MOTION

FOGLER, RUBINOFF LLPLawyers77 King Street WestSuite 3000, P.O. Box 95TD CentreToronto, Ontario M5K 1 G8



i '~



COMMERCIAL LIST

SIDNEY STREET PROPERTIES CORP.Applicant

and -


Respondent

APPLICATION UNDER SUBSECTION 243(1) OF THE BANKRUPTCY AND INSOLVENCYACT, R.S.0 1985, c. B-3 AS AMENDED AND SECTION 101 OF THE COURTS OF JUSTICE

ACT, R.S.O 1990, c. C. 43, AS AMENDED

SECOND REPORT OF BDO CANADA LIMITED, IN ITS CAPACITYAS COURT APPOINTED RECEIVEROF 2428049 ONTARIO INC.

JULY 27, 2017

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INTRODUCTION AND BACKGROUND ............................................................................... 4

Introduction ......................................................................................................................4

Purpose of this Report ....................................................................................................5

Disclaimer..........................................................................................................................6

Background........................................................................................................................7

ACTIVITIES OF THE RECEIVER .........................................................................................9

SALE OF THE BELLEVILLE PROPERTY ..........................................................................10

Sales Commission ...........................................................................................................11

Sealing..............................................................................................................................12

SECURITY OPINION .........................................................................................................12

PRIORITY PAYABLES/DEEMED TRUSTS ........................................................................13

Property Taxes ................................................................................................................13

WEPPA Claim ................................................................................................................... 13

CRA Deemed Trusts ........................................................................................................13

Other Creditors ...............................................................................................................15

RECEIVER'S BORROWINGS .............................................................................................16

RECEIPTS AND DISBURSEMENTS ....................................................................................17

PROFESSIONAL FEES AND DISBURSEMENTS .................................................................17

DISCHARGE ...................................................................................................................... 19

SUMMARY AND RECOMMENDATIONS ............................................................................ 19

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APPENDICES


B Receiver's First Report dated January 30, 2017 (excluding appendices)

C Order of Justice Hainey dated February 9, 2017

D Listing Agreement

E Commission Invoice

F Security Opinion of Fogler, Rubinoff LLP dated July 19, 2017

G Property Tax Statements

H CRA Property Claim -Payroll Source Deductions

CRA Notice of Assessment -HST

J CRA Auditor's HST Arrears Schedule

K Hamilton Smith Limited Judgement dated July 12, 2016

L Receiver's R&tD Statement

M BDO Canada Limited Fee Affidavit

N Fogler, Rubinoff LLP Fee Affidavit


1 Offer to Purchase Dated June 1, 2017 (including amendments)

2 Key Financial Terms of Sale Agreement

INTRODUCTION AND BACKGROUND

Introduction

1. By Order of the Honourable Justice Penny of the Ontario Superior Court of Justice

(the "Court") dated December 13, 2016 (the "Receivership Order"), BDO Canada

Limited was appointed as receiver ("BDO" or the "Receiver") of the assets, properties

and undertakings of 2428049 Ontario Inc. ("242" or the "Debtor") pursuant to the

application of Sidney Street Properties Corp. ("Sidney" or the "Applicant"). A copy of

the Receivership Order is included hereto as Appendix A.

2. The Applicant is the first mortgagee over the Debtor's real property municipally

known as 250 Sidney Street, Belleville, Ontario (the "Belleville Property"). The

Applicant does not hold any personal or corporate guarantees in respect of the first

mortgage.

3. Pursuant to the Receivership Order, BDO was appointed Receiver with limited

powers and duties with respect to the assets, property and undertakings of the Debtor.

The Receivership Order explicitly provides that the Debtor shall remain in possession

and control of the Belleville Property and that the Receiver shall not possess, control,

hold, administer and manage the Belleville Property.

4. Pursuant to the Order of Justice Hainey in these proceedings dated February 9,

2017, (the "Rainey Order") this Court ordered or authorized that, among other things:

(i) the Receiver list the Belleville Property for sale with D.W. Gould Realty Advisors Inc.

("Gould") at a list price of $3.1 million as recommended by the Receiver in its First

Report dated January 30, 2017 (the "First Report") attached as Appendix B (excluding

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exhibits); (ii) Sidney operate, administer and manage the Belleville Property during this

Receivership; and Sidney be paid for its future costs or expenses regarding the

administration and management of the Belleville Property by the issuance of Receiver's

Certificates; and (iii) authorized the Receiver in its own discretion, without further

order of the Court, to use or apply the rental money or funds collected from the tenants

of the Belleville Property in order to fund the Debtor's operating costs during the

receivership. A copy of the Hainey Order is included hereto as Appendix C.

Purpose of this Report

5. The purposes of this report dated July 27, 2017 (the "Second Report") are to:

a) seek the Court's approval of the Second Report and the activities of the

Receiver set out herein;

b) seek the Court's approval of the sale transaction for the Belleville

Property contemplated by the Offer to Purchase fully executed on June

1, 2017, as amended (the "Sale Agreement") between the Receiver and

Toronto Capital Corp. (as it so assigns) (the "Purchaser") and accepted

by Sidney, Rentx Properties Corp. and Rentx Transportation Services

Corp.;

c) seek the Court's approval to vest the Debtor's right, title and interest in

and to the assets or property described in the Sale Agreement, free and

clear of any claims and encumbrances, except for permitted

encumbrances, in the Purchaser upon closing the sale transaction

pursuant to the Sale Agreement;

d) seek the Court's approval to seal Confidential Appendices 1 and 2 to the

Second Report until the closing of the sale transaction or further order of

this Court to preserve the integrity of the Receiver's sate process;

e) seek the Court's approval for the Receiver to sign Gould's invoice thereby

amending the terms of the Listing Agreement to limit Gould's sale

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commission to $30,000 plus HST on the proposed sale transaction with

the Purchaser.

f) seek the Court's approval of the Receiver's Statement of Receipts and

Disbursements (the "R£tD Statement") included in the Second Report;

~) seek the Court's approval of the fees and disbursements of the Receiver

and its legal counsel, Fogler, Rubinoff LLP ("Fog(er") as set out in this

Second Report, and authorize the Receiver to pay all approved and unpaid

fees and disbursements and the Professional Fee Reserve (defined

below).

h) subject to funding certain remaining operating expenses incurred by the

Debtor, payment of outstanding property taxes, payment of the WEPPA

claim, repayment of the Receiver's borrowing pursuant to the Receiver's

Certificates and appropriate reserves or holdbacks being maintained by

the Receiver from the cash at hand to pay all outstanding and future

professional fees, authorizing and directing the Receiver to make a

distribution of any remaining funds in its possession to the Canada

Revenue Agency ("CRA") in respect of its deemed trust claims, as

described in the Second Report; and

i) seek the discharge and release of BDO as Receiver over the Debtor's

assets, properties, and undertakings.

Disclaimer

6. This Second Report is prepared solely for the use of the Court for the purpose of

assisting the Court in making a determination whether to approve: (i) the sale of the

Belleville Property; (ii) a Final Distribution (defined later) by the Receiver to CRA; (iii)

the discharge of BDO as Receiver; and (iv) other ancillary relief being sought.

7. Unless otherwise stated, all monetary amounts contained in this First Report are

expressed in Canadian dollars.

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Background

8. 242 is an Ontario corporation. The Receiver understands that Karl Holtett is the

President, Secretary and sole director of 242. The Debtor's sole purpose appears to be

that of ownership of the Belleville Property.

9. The Belleville Property consists of approximately 33 acres of land with a 305,000

square foot building and ancillary buildings currently occupied by 4 tenants; the anchor

tenant being Avaya Canada Corp. ("Avaya").

10. 242 has owned the Belleville Property since October 15, 2014 when it acquired

the property from Sidney and Palmer Road Properties Corp. ("Palmer") for $3.1 million.

As security for the sale of the Belleville Property, Sidney was granted by 242 a vendor-

take-back mortgage in the principal amount of $2.17 million pursuant to

Charge/Mortgage dated October 15, 2014 (the "Mortgage") that was registered against

the Belleville Property. A copy of the Mortgage was included as Appendix B to the First

Report.

1 1. Given the significant environmental problems associated with the Belleville

Property, the Ministry of Environment, now the Ministry of the Environment and Climate

Change ("MOECC"), registered a Certificate of Requirement against title to the

Belleville Property on September 19, 2011 pursuant to the Environmental Protection Act

with respect to certain Director's Orders and related proceedings before the

Environmental Review Tribunal.

12. The Belleville Property was originally owned by Nortel Networks Limited

("Nortel") or its corporate predecessors and has significant environmental issues

allegedly caused by the manufacturing of electrical components for the

telecommunications industry. The environmental issues associated with the Belleville

Property, and other impacted properties owned by Nortel, have been dealt with by this

Court in Nortel's proceedings under the Companies' Creditors Arrangement Act (the

"CCAA").

1 3. It is the Receiver's understanding that in the Nortel CCAA proceedings, a reserve

of approximately $100 million or more has been established in respect of the continuing

performance obligations of Nortel pursuant to the MOECC Orders, including the MOECC

Order on the Belleville Property.

14. Sidney and a related company have filed a claim in the Nortel CCAA proceedings

in relation to the alleged obligations of Nortel owing to them regarding the

environmental remediation of the Belleville Property.

15. Past, current and future owners of the Belleville Property, including Sidney as a

past owner, are allegedly subject to the MOECC Director's Order regarding the Belleville

Property and the related proceedings before the Environmental Review Tribunal.

16. The Debtor is currently in default of its obligations under the Mortgage ultimately

leading to this receivership proceeding. As of July 28, 2016, 242 was indebted to the

Sidney in the amount of $1,824,415.74 (the "Indebtedness"). Sidney reports that the

Indebtedness will exceed $2.0 million by August 10, 2017, the expected closing date of

the sale transaction with the Purchaser.

17. Further alleged background information leading up to the receivership

proceeding and outlining in further detail the alleged history of environmental

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contamination at the Belleville Property and the ongoing environmental work and

remediation at the Belleville Property is included in the affidavit of Bernard D. Ouellet

sworn October 13, 2016 attached, without exhibits, as Appendix C to the First Report.

ACTIVITIES OF THE RECEIVER

18. Pursuant to the Receivership Order, the following is a summary of the more

salient activities of the Receiver since the First Report:

(a) Collecting rents from the commercial tenants;

(b) Listing the Belleville Property for sale with Gould;

(c) Negotiating the sale agreement for the Belleville Property with the Purchaser

and Sidney;

(d) Continuing to liaise with the insurance adjuster, Intact Insurance, to recover

funds under an insurance claim covering the costs associated with the

replacement of a "blown" transformer;

(e) Settling a rent dispute with Avaya;

(f) Regarding the alleged post-receivership occupation rent or storage costs

owing in relation to Strathcona's tenancy at the Belleville Property as

described in the First Report, Minutes of Settlement were entered by the

Receiver, The Fuller Landau Group Inc., and msi Spergel inc., the latter two

being the receivers of Strathcona, on or about March 31, 2017 (the

"Settlement"}. Under the Settlement, among other things, the Receiver was

paid approximately $40,000 towards occupation rent.

(~) Providing funding to 242 so that it can continue to pay its ongoing operating

costs and building maintenance expenses; and

(h) Dealing with tenant and creditor inquiries.

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SALE OF THE BELLEVILLE PROPERTY

19. Pursuant to the Hainey Order, the Receiver listed the Belleville Property for $3.1

million with Gould. A copy of the Listing Agreement is attached as Appendix D.

20. To date, a single offer has been received for the Belleville Property. The Offer

to Purchase, as dated June 1, 2017 and subsequently amended is from the Purchaser. A

copy of the Offer to Purchase including amendments is included as Confidential

Appendix 1.

21. The key financial terms of the Sale Agreement are disclosed in Confidential

Appendix 2. A summary, on a redacted basis, of some of the key terms include: (i)

cash paid to the Receiver is to be in the amount of $430,000: a deposit of $72,000 was

delivered with the offer; a further deposit of $278,000 is to be delivered upon the

Purchaser waiving certain conditions; and the Receiver keeps the rent adjustment for

August, 2017 in the approximate amount of $80,000; (ii) that a significant portion of

the purchase price is to be covered by a first mortgage granted by the Purchaser over

title to the Belleville Property in favour of Sidney; (iii) the sale is on an "as is, where is"

basis; (iv) the sale is scheduled to close on or before August 10, 2017; and (v) the sale

is subject to an approval and vesting order being granted by this Court.

22. The MOECC Director's Order will not be affected by the approval and vesting

order, in that it will be listed as a permitted encumbrance in the approval and vesting

order. Consequently, the Purchaser is willing to close the sale transaction

notwithstanding the significant potential environmental liability associated with

ownership of the Belleville Property.

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23. The Receiver is recommending the Court's approval of the Sale Agreement for

the following reasons: (i) the significant environmental issues facing the Belleville

Property and the potential liability to any party purchasing the property has made this

offer the "only game in town"; (ii) any purchaser is not likely to obtain traditional bank

financing for this type of transaction because of the property's environmental issues,

further reducing the market; (iii) the high risk nature of this real estate opportunity is

a further impediment to a robust market; and (iv) the lengthy timeframe likely required

to attract a buyer in the circumstances.

24. The Receiver is also of the view that Gould exposed the Belleville Property to

the public for a reasonable time and brought this risky real estate opportunity to the

public's attention. The Purchaser's offer arising from the listing of the Belleville

Property in the Receiver's opinion is the best offer that could be obtained in the

circumstances.

25. The Debtor's major creditor or first mortgagee, Sidney, supports the proposed

sale of the Belleville Property to the Purchaser.

Sales Commission

26. Gould is entitled to a sales commission of the greater of 5% of the purchase price

or the lesser of the purchase price or $75,000. Gould's commission rate was structured

as such to ensure that Gould would be properly compensated for its services given the

high risk nature of this real estate opportunity considering the environmental challenges

with the Belleville Property.

27. Notwithstanding the commission structure set out in the Listing Agreement,

Sidney subsequently negotiated with Gould and the latter provided the Receiver with

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an invoice discounting the sales commission on the proposed sale to the Purchaser to

$30,000 plus HST. A copy of Gould's commission invoice is appended hereto as Appendix

E. In the circumstances, the Receiver is seeking the Court's approval for the Receiver

to sign the invoice as contemplated thereby limiting the sales commission payable to

Gould to $30,000 plus HST in respect of the proposed sale to the Purchaser.

Seating

28. The Receiver is requesting an order sealing Confidential Appendices 1 and 2 to

the Second Report, namely a summary of the key financial terms and the Sale

Agreement, to prevent any prejudice to the sale process or listing if the sate transaction

does not close.

29. Upon completion of the sale of the Belleville Property on or before August 10,

2017 pursuant to the Sale Agreement, there will be no other or few assets or property

of the Debtor of realizable value that need to be considered or dealt with by the

Receiver.

SECURITY OPINION

30. The Receiver engaged Fogler as independent legal counsel and requested that it

provide the Receiver with a security opinion on the validity and enforceability of the

Mortgage. The Receiver received a security opinion from Fogler, which subject to the

assumptions and qualifications set out in the security opinion of Fogler, confirms the

validity and enforceability of the Mortgage. A copy of the Fogler security opinion is

attached hereto as Appendix F.

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PRIORITY PAYABLES/DEEMED TRUSTS

Property Taxes

31. The Receiver understands that as of July 24, 2017 approximately $290,000, in

outstanding property taxes are due to the City of Belleville and form a first charge on

the Belleville Property ahead of Sidney's Mortgage. The outstanding property taxes are

anticipated to be paid out of the sale proceeds on the closing of the proposed sale

transaction with the Purchaser. Copies of the property tax accounts for the Belleville

Property are attached as Appendix G. The outstanding property taxes, including

accrued interest, are estimated to be approximately $294,000 on August 10, 2017, the

expected sale closing date.

WEPPA Claim

32. The Receiver has also determined that up to $2,166.30 is payable by the

Receiver, out of any recovery from the current assets of 242, in respect of subrogated

employee claims under WEPPA that are otherwise payable by the Receiver under Section

81.4 (1) of the Bankruptcy and Insolvency Act. This subrogated employee claim payable

to Service Canada has a priority over repayment of borrowed funds under the Receiver's

Certificates pursuant to the borrowing provisions contained in the Receivership Order.

CRA Deemed Trusts

33. The Receiver has received a property claim from CRA in respect of unremitted

payroll source deductions in the amounts of $25,090.37. A copy of CRA's deemed trust

claim is attached hereto as Appendix H.

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34. Pursuant to subsection 227(4.1) of the Income Tax Act ("ITA"), the Crown is

granted the right to recover first as against all of the tax debtor's property, in advance

of all other "security interests" (a broadly defined term including all charges and liens

on property). The only exception to this "super priority" is set out in subsection 227(4.2)

of the ITA, which carves out a "prescribed security interest" from the definition of

"security interest".

35. The Receiver is also aware of the Debtor's HST arrears totaling approximately

$211,000 dating as far back as June 30, 2015. Attached as Appendix I is the most recent

Notice of Assessment received from CRA. Additionally, the Receiver received a

breakdown of the HST from the CRA auditor also attached in Appendix J. The Receiver

expects to receive a deemed trust claim from CRA in the near future in respect of the

outstanding HST liability.

36. Subsection 222(1) of the Excise Tax Act ("ETA") creates a trust for collected but

unremitted HST/GST which attaches to and is impressed upon all real and personal

property of the debtor. All monies received by a debtor in respect of HST/GST,

notwithstanding any "security interest" which may otherwise be in effect as against the

debtor's property, are accepted subject to the trust and deemed to be held separate

and apart from all other property of the debtor. As set out in subsection 222(4] of the

ETA, for the purpose of the "super priority" created in subsection 222(3), a "security

interest" does not include a "prescribed security interest".

37. As provided for under each of the ITA and the ETA in respect of the deemed

trusts for payroll source deductions and HST/GST respectively, a "prescribed security

interest" means the part of a mortgage securing the performance of an obligation of the

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tax debtor which was registered against real property before the arrears over which the

deemed trust attaches arose.

38. Given that the Mortgage predates the arrears over which CRA's aforementioned

deemed trusts arose, the Receiver is advised by its counsel that the Mortgage registered

in October 2014 by Sydney against the Belleville Property qualifies as a "prescribed

security interest" under both the ITA and ETA. Accordingly, the Mortgage would appear

to have priority ahead of CRA's deemed trust claims. Essentially, failure by 242 to remit

HST and payroll source deductions did not benefit the mortgagee since the Mortgage

was registered before 242's obligations to CRA arose.

Other Creditors

39. Hamilton Smith Limited ("Hamilton") registered a construction lien in the land

registry office against title to the Belleville Property in the amount of $100,491 on

August 5, 2015 for what appears to be a breach of contract claim. A copy of the

Judgement dated July 12, 2016 obtained by Hamilton referencing the lien is included

hereto as Appendix K.

40. The Hamilton construction lien was registered in the land registry system

subsequent to the Mortgage. The Mortgage was not a building mortgage but rather a

prior non-building mortgage as defined under the Construction Lien Act ("CLA"). No

advances were made by Sidney to 242 after Hamilton's construction lien arose.

Therefore, the Receiver is advised by its counsel that pursuant to the exemptions set

forth in section 78(3) of the CLA, the Mortgage appears to have priority to Hamilton's

lien equal to lesser of i) value of the Belleville Property when lien first arose ($3.1

million); or ii) total advances before the lien arose ($2.17 million). Additionally, the

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Receiver is advised that the Hamilton construction lien appears to be subordinate to the

deemed trust claims of CRA.

41. Other secured creditors of 242 include RCAP Leasing Inc. ("RCAP") and Trisura

Guarantee Insurance Company ("Trisura"). These secured creditors' security interests

appear to be over the personal property of 242. A copy of the Persona( Property Security

Act search against 242 as of December 19, 2016 was attached as Appendix J to the First

Report.

42. Finally, Hamilton Smith Limited and Sysco Canada, Inc. appear to be post-

Mortgage, execution creditors of 242.

43. These aforementioned creditors will be served with the Receiver's motion record

returnable August 3, 2017 and will be able to appear and make submissions to the Court

they feel are appropriate in the circumstances.

RECEIVER'S BORROWINGS

44. The Receiver borrowed $75,000 from Sidney through the issuance of Receiver's

Certificates in order to provide 242 with adequate funding to pay ongoing operating

costs and cover maintenance and repairs costs to preserve the value of the Belleville

Property for the benefit of the creditors.

45. The Receiver's Certificates bear interest at an annual interest rate of 10% which

was negotiated with Sidney. Sidney was the only logical party that would provide

funding to the Receiver in the circumstances.

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46. The Receiver intends on repaying the Receiver's Certificates, plus accrued

interest, to Sidney, from any funds remaining in the estate, after payment of the

subrogated employee claims owing to Service Canada totaling $2,166.30 that are

otherwise payable by the Receiver under Section 81.4 (1) of the Bankruptcy and

Insolvency Act, following the closing of the sale transaction with the Purchaser.

RECEIPTS AND DISBURSEMENTS

47. The R~tD Statement, appended hereto as Appendix L, reports net receipts over

disbursements for the period of $109,923.42, before provision for payment of future

operating disbursements, outstanding property taxes, Receiver's borrowings, WEPPA

and outstanding and future professional fees of the Receiver and its counsel.

48. Following payment of the outstanding property taxes, WEPPA, the Receiver's

borrowings, and outstanding professional fees and the Professional Fee Reserve (defined

below), the Receiver seeks approval to distribute all remaining estate funds to CRA in

respect of its deemed trust claims up to the amount of its indebtedness (the "Final

Distribution").

PROFESSIONAL FEES AND DISBURSEMENTS

49. Pursuant to the Receivership Order, the Receiver has provided services and

incurred disbursements which are more particularly described in the affidavit and

detailed invoices attached hereto as Appendix M.

50. The detailed time descriptions contained in the invoices provide a fair and

accurate description of the services provided and the amounts charged by BDO as

Receiver. Included with the invoices is a summary of the time charges of partners and

staff, whose services are reflected in the invoices, including the total fees and hours

billed.

51. Additionally, the Receiver has incurred legal fees of its counsel in respect of

these proceedings, as more particularly set out in the fee affidavit and exhibits attached

hereto as Appendix N.

52. The Receiver has reviewed Fogler's fee affidavit and believes same to be fair

and reasonable in the circumstances.

53. The Receiver requests that the Court approve its accounts for the periods from

September 15, 2016 to November 2, 2016 and January 30, 2017 to July 26, 2017 in the

amount of $54,276.14 for fees and disbursements including HST of $7,055.90, for a total

of $61,332.04 plus the amount of $10,000, plus HST, to complete the administration of

the estate.

54. The Receiver also requests that the Court approve the accounts of its legal

counsel for the period from October 27, 2016 to November 8, 2016 and January 29, 2017

to June 21, 2017 in the amount of $64,913.61 for fees and disbursements including HST

of $8,417.96, for a total of $73,331.57 plus the amount of $15,000, plus HST, to

complete the administration of the estate.

55. As stated, the Receiver estimates that it will incur $28,250 in future professional

fees to complete the administration of the estate consisting of $25,000 in future

professional fees of the Receiver and its counsel plus HST of $3,250 (the "Professional

Fee Reserve").

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DISCHARGE

56. After the sale of the Belleville Property pursuant to the Sate Agreement, the

Receiver will be in a position to complete and conclude the administration of this

receivership.

57. Alt of the Receiver's duties as set out in the Receivership Order will be completed

upon: i) filing the final estate HST returns to recover any unclaimed input tax credits;

ii) making the Final Distribution and iii) filing the Receiver's final report pursuant to S.

246(3) of the Bankruptcy and Insolvency Act with the Office of the Superintendent of

Bankruptcy. Once the Receiver has completed these activities, the Receiver proposes

to file a Receiver's Certificate with the Court certifying same to obtain a discharge and

release over the undertaking, property and assets of the Debtor.

58. The expeditious completion of the Receivership will avoid the costs of additional

Court appearances and reduce any potential confusion in the market with respect to the

status of the Debtor or the new ownership of the Belleville Property.

59. The Applicant is supportive of the discharge of the Receiver.

SUMMARY AND RECOMMENDATIONS

60. Based on the foregoing, the Receiver recommends that the Court:

a) approve this Second Report of the Receiver, and the activities and

conduct of the Receiver set out herein;

b) approve the Sale Agreement and authorize the Receiver to complete the

transaction contemplated thereunder;

c) vest title in the Belleville Property in the Purchaser;

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d) seal Confidential Appendices 1 and 2 in order to preserve the integrity of

the sale processes and to protect this commercially sensitive financial

information until further Order of this Honourable Court;

e) approve the Receiver's R&~D Statement;

f) approve the fees and disbursements of the Receiver and its legal counsel,

Fogler, as set out in this Second Report, and authorize the Receiver to

pay all approved and unpaid fees and disbursements.

g) Approve the Final Distribution of any remaining funds in the estate to

CRA after closing the sale transaction with the Purchaser;

h) approve the discharge and release of BDO as Receiver of the assets,

properties and undertaking of the Debtor upon BDO filing the Receiver's

Certificate with the Court.

All of which is respectfully submitted this 27th day of July, 2017.

BDO CANADA LIMITED Court Appointed Receiver of2428049 Ontario Inc.Per:

Name: Gary Cerrato, CIRPTitle: Vice-President

t~

Court File No. CV-16-11565-OOCI~

ONTARIO

SUPERIOR COURT OF JUSTICE

COMMERCIAL LIST

THE HONOURABLE MR. ) TUESDAY, THE 13"'

JUSTICE PENNY ~ DAY OF DECEMBER, 2016


-and-

2428049 ONTARIO 1NC.

ORDER

(appointing Receiver}

Applicant

Respondent

THIS APPLICATION made by Sidney Street Properties Corp. (the "Applicant" or "First

Mortgagee"} for an Order 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 (the "CJA") appointing BDO Canada Limited as receiver {in such

capacities, the "Receiver") without security, to exercise the limited powers and duties as

specifically set out in this Order with respect to the assets, undertakings and properties of

2428049 ONTARIO INC. (the "Debtor") acquired for, or used in relation to a business carried on

by the Debtor, was heard this day at 330 University Avenue, "l~oronto, Ontario.

f 771742v3

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ON READING the affidavit of Bernaz~d D. Ouellet sworn October 13. 2016 and the

[ xhibits there-to and on hearing the submissions of counsel for the Applicant, the proposed

Receiver and any other patty on the service list as duly served as appears from the affidavit o~t~

service of Heather• Peart sworn October 24, 2016 and oi~ reading the consent of BDO Canada

Limited to act as the Keceiver,

SERVICE

THIS COURT ORDERS that the time for service of tl~e Notice of Application and the

application is hereby abridged and validated so that this application is properly i~ettunable today

and hereby dispenses with filrther service thereof.

APPOINTMENT

2. THIS CC)URT ORDERS that pursuant to section 243(1) of the BIA and section 101 of

the CJA, I3D0 Canada Limited is hereby appointed Receiver, without security, to exercise the

limited powers and duties as specifically set out in this Order tivith respect to the assets,

undertakings and properties of the Debtor acquired for, or' used in relation to a business carried

on by tl~e Debtor, including all proceeds thereof (the "Property").

2A. TI-IIS COURT ORDERS that, notwithstanding anything to the contrary iii this Order, but

subject to the rights and remedies of the First Mortgagee and further Order of this Court, the

Debtor shall remain in the possession and control of the Property (including the real property

municipa]]y known as 250 Sidney Street, Belleville, Ontario (the "Belleville Property")) and for

greater• ceT-tainty, the Receiver shall not possess, control, hold, adinii7ister and manage tl~e

Belleville Property within the meaning of any Fnvii~onmenfal Legislation (as defined below).

2B. THIS COURT ORDERS that nothing in this Order shall affect or impair in any mamlel•

t1~e rights an~3 remedies of the First Nlortga~ee in respect oi~ the Property, btiit subject to the

Receiver's Charge (as defined below). F'or greater certainty, the First Mortgagee's priority, rights

and remedies in respect of the Prope~~ty shall be unaffected by the terms of this Order including

without limitation the Receiver's limited rights and dowers to deal with the Property, but shall be

subject to the Receiver's Charge (as defined below}.

i ~~ »a?~3

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RTCI+.IVER'S POWERS

3. THIS COURT ORDERS that the Receiver is hereby expressly empowered and

authorized, but not obli;ated, to e;~ercise any of the followinb limited powers in respect of tilae

E'roperty where the Keceiver considers it necessary or desirable:

(a} to engage consultants, appraisers, agents, experts, auditors, accountants,

real estate agents, couiZsel and such other persons from time to time and on

whatever basis, including on a temporary basis, to assist with the exercise

of the Receiver's powers and duties, including without limitation those

conferred by this Order;

(b) to receive and collect all rezits iiow owed or hereafter owing to the Debtor

with respect to the Belleville Property and to exercise all remedies of the

Debtor in collecting such monies, _ _ __

(c) to market any oi• all of the Belleville Property, including advez•tising and

soliciting offers in respect of the Belleville Property or any part or parts

thereof and negotiating such terms and conditions of sale as the Keceiver

in its discretion may deem appropriate;

(d) to sell, convey, transfer, lease, assign, or sever under the Ontario Planning

Act, the Property ar any part or parts thereof otit of tl~e ordinary course of

business with the approval of this Court and in such transactio~l, notice

under subsection 63{4) of the Ontario Personal Pf-operly ,Security ~lct, or'

section 31 of the Ontario ~i~lor~tgages ~Ict, as the case 1~7ay be, shall not be

requit•eci, and in each case the Ontario 13u1k Sales Clef shall not apply.

(e) to apply for any vestinb order oz• other orders necessary to covey the

Belleville Property or a~1y part or• parts thereof to a purchaser or' purcl~asei•s

thereof, free and clear of ally liens or encur~~brances affecting such

Belleville Property;

i ~~ »a2~3

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(f) to report to, meet with and discuss with such affected Persons (as def ned

below) as the Receiver deems appropriate on all matters relating to the

Property a~1d the receivership, and to share information, subject to such

terms as to eonfidenti~lity as the Receiver deems advisable;

(g) to register a copy of this Order and any otheT~ Orders iii respect of the

Belleville Property against title to any of the Belleville Property; at~d

{h) to take any steps reasonably incidental to the exet-cise of these powers or

the pet-formance of any statutory obligations,

and in each case where the Receiver takes any such actions or steps, it shall be exclusively

authorized and empowered to do so, to the exclusion of all other Persons (as defined below),

including the Debtor, and without intez-ference from any other Person.

llUTY TO PROVIDE ACCESS AND CO-OPERATION 'TO THL 1tECLIVEI2

4. THIS COURT ORDERS that (i) the Debtor, (ii) all of its cut~rent and former directors,

officers, employees, agents, accountants, legal counsel and shareholders, and all other persons

acting ~ on its instructions or behalf, and (iii) all other individuals, firms, cor}~orai3ons,

governmental bodies or abencies, or~ other entities having notice of this Oz•dcr (all 01' tl~e

foregoing, collectively, being "Persons" and each being a "Perso~l") shall forthwith advise the

Receiver of the existence of any P1~opei-ty in such Person's possession oi- control, shall grant

immediate and continued access to the Property to the Receiver, and shall deliver all such

Property do the Receiver upon the Receiver's request.

5. '1'~ IIS COURT ORDERS that all Persons shall forthwith advise the Keceiver of the

existence of any books, documents, securities, contracts, orders, corpoi-a~e and accounting

records, and any other papers, records and information of any kind related to the business or

affairs of t11e Debtot~, and any computer programs, computer takes, computer- disks, oz' other dada

storage media containing any such iirformation (the foregoing, collectively, t11e "Records") in

that Person's possession or control, and shall provide to the Receiver or permit the Receiver to

rnalce, retain and take away copies thereof and grant to the Receiver wlfettered access to and use

of accounting, computer, software and physical facilities relating the~~eto, provided however- that

1 771742v3

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nothing in this paragraph 5 or in paragraph 6 of this Order shall require the delivery of Records,

or the granting of access to Records, which may not be disclosed or provided to the Receiver due

to the privilege attaching to solicitor-client communication or due to statutory provisions

prohibiting such disclosure.

6. THIS COURT ORDERS that if any Records are stored or otherwise contained on a

computer or othez~ electronic system of infol•mation storage, whether by itldependent service

provider or otherwise, all Persons in possession or con~~•ol oC such Records shall forthwith give

unfettered access to the Receiver for the purpose of allowing the Receivet~ to recover and fully

copy all of tl~e itlformation contained Cherein whether by way of p1-inting the information onto

paper or malting copies of computer disks or• such other manner of retrieving and copying the

information as the Receiver in its discretion deems expedient, and shall not alter, erase or destroy

any Records without the prior written consent of the Receiver. further, for the purposes of this

paragraph, all Persons sha11 provide the Receiver with all such assistance in gaining immediate

access to the inloi°matioi7 in the Reeords as the Receiver may in its diset-etion require including

providing the Receiver with instructions on the use of any computer or other system and

providinb the Receiver with any and all access codes, account names and account numbers that

may he required to gain access to the information.

7. THIS COURT ORDERS that the Receiver shall provide each o.(~ the relevant landlot•ds

with notice of the Receiver's intention to remove any fixtures From any leased premises at least

se~~en (7) days pz~ior to the date of the intended removal The relevar7t landlord shall be entitled

to have a representative present in the leased premises to observe such removal and, if tl~e

landlord disputes the Receiver's entitlement to remove any such fixture udder the provisions of

the lease, such ~~ixture shall remain on the premises and shall be dealt with as ~gz~eed between airy

applicable secured cl•editors, such landlord and the Receiver, or by further Order of this Coui-t

upon application by the Receiver on at least two (2) days' notice to such landlord and any such

secured creditors.

NO PROCEEDINGS AGAINST THE RTCFIV~R

1 771742v3

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8. TIlIS COURT ORDERS that no proceeding or ~enforceinent process in any court or

tribunal (each, a "Proceeding"), shall be commenced or continued against the Receiver except

with the written consent of the Receiver• or with leave of this Court.

NO PROC1~,rDINGS AGAINST THE DEBTOR OR THE PROP~R'TY

J. "THIS COURT ORDERS that no Proceeding against or in respect of the llebtor or the

Property shall be commenced or continued except with the writtetl consent of the Receiver or

with leave of this Court aild any and all Proceedings currently under way against or in respect oi~

the Debt.or~ or t11e Property are hereby stayed and suspended pending fLlrther Order of this Court,

provided however and for greater certainty that this stay and suspension of Proceedings does not

apply in respect of: {i} Director's Ordei• No. 8835-8J4QRU dated September 7, 2011 regarding

the Belleville Property issued by the Ministry of t11e Fnviroiv~~ent ("MOE" and now the Ministi•}~

of Environment and Climate Change, °MOECC") (fhe "MO.~ Order") pursuant to the

En>>ii~~~ni~ierttal~ P~°otection Act (Ontario} (thee "EPA") and the r~latecl proceec~ing~ b~efar~e the

r~nviroilinental Review Tribunal (the 'BRT"); and (ii) the Coi~~pclf2ies' Cf~eclitof~s ArYcnzge~azent

,4ct proceedings in respect of Nortel Networks Corporation et al. (Court file No. 09-CL-7950)

pending before fl~is Court {the "Nai-tel CCAA Pt~oceedillgs"), including, withoLlt lin7itation, as

relates to the resolution of the proofs of claim filed by the Applicai7t in the Nortel CCAA

Proceedings (the "CCAA Proofs of Claim").

NO I±.XTRCISC UI' RIGHTS OR REMEDIES

10. TI-I1S COURT QRDERS ghat all rights and i~emedics against the Debtor, the Receiver, oi•

affecting the Property, are hereby stayed and suspended except with the written consent of the

IZeceiveT• or' leave of this Court, provided however• that this stay and suspensiol~ does not apply in

respect of any "eligible financial contract" as defined in the ~BIA, and fw~ther pa-ovided that

nothing in Chis paragraph shall (i) empower the Receiver or the Debtor to carry on any business

which the Debtor' is not lawfully entitled to carry on, (ii) exempt the Receiver or the Debtot~ from

compliance with stat~itory or T•egula~ory provisions relating to health, safety or the ei7vironment,

(iii) preve~~t the filing of any registration to preserve or perfect a sectu~ity interest, (iv) prevent the

registration of a claim for lien; or (v) prevent compliance with or otherwisE restrain or have any

in~pacC o~~ the MOE Order• and airy decisions or orders by the l R~I~ and any order o1~ process in

-7-

the Nortel CCAA Proceedings, including, without limitation, with respect to the resolution of the

CCAA Proofs of Claim.

N() INTERFERENCE WITFI THE RECLINER

1 1. THIS COURT ORDERS that no Person shall discontinue, fail t~o honour, alter, interfere

with, repudiate, terminate or cease to perform any right; renewal right, contract, agreement,

licence oz• permit iii favour of or held by the Debtor, without written consent of the Receiver or

leave of this Court.

CONTINUATION OF S~RVIC~S

12. THIS COURT ORDERS that all Persons having oral or written agreements with the

llebtor or statutory or z•egulatoly mandates for the supply of goods and/or services, i~~cluding

without limitation, all computer software, comtnunicatioi~ and other data services, centralized

l~aizkin~services~ payrol~sei•vices; insurance, transpoi-tationservic~~; utility or other services to - - ---

the Debtor- are hereby restrained until further Order of this Court 1i-om discontinuing, altering,

interfering with or terminating the supply of such goods or services as may be required by the

Receiver, and that the Receiver sha11 be entitled to the continued tike of the Debtor's currefit

telephone numbers, facsimile numbers, Internet addresses and domain names, pz~ovided in each

case that the normal prices or charges for all such goods or services z•eceived aftci- the date of this

Order are paid by the Receiver in accordance with no~~mal payment practices of the Debtor or

such other practices as may be agl•eed upon by the supplier or service pt•ovider and the Receiver,

or as nlay be ordered by this Court.

RECT;I'~'~R TO HOLD FUNDS

13. TI~IIS COURT ORDERS that all funds, monies, cheques, instrurneilts, and other• forms of

payu~ents received or collected by the Receiver from and after the making of this O7~der from any

source whatsoever, ineludiiag without liini~atioi~ t}~c sale of all or any of the Pt~operty and the

collection of any accounts receivable in whole or in part., whether in existence on tl~e date of this

Order or' 1lereafier coming into eYisfellce, shall be deposited into ol~e or- more new accounts to be

opened by the Receiver (the "Post Receivership Accounts") and the i~~onies standing to the credit

of such Post Receivership Accounts from time to time; net of az~y disbursements provided for

-8-

1lerein, shall be held by the Receiver to be paid in accordance with the terms of this Order or' airy

further Order of this Courl.

EMPLOY~~S

1 ~. THIS COURT ORDERS that all employees of the Debtor- shall remain the employees of

the Debtor until such time as the 1Zeceiver, on the lleb~or's behalf, inay terminate the

einployn~ei7t of such employees. The Receiver shall not be liable for any employee-related

liabilities, including any successor employer liabilities as provided for in section 14.06(1.2) of

file ~31A, other ttlan such amounts as the Receiver may specifically agz~cc in writing to pay, or in

respect of its obligations under sections 81.4(5) oi• 81.6(3) of the .BIA or under the I~~age .Earner

Protection Pf~•og~am pct.

1'Il'EllA

15. 7'IIIS COURT- ORDERS that, pu~•suant to clause 7(3)(c) of the C;aiaada Per•s~nal - - --

Infor•rrzation Pr•otectinn and Electronic Documents Act, the Receiver shall disclose personal

information of identifial~ie individuals to prospective puz-chasers or bidders f'or the Property and

to their advisors, but only to the extent desirable or required to negotiate and attempt to complete

one ar more sales of the Property {each, a "Sale"). Each prospective purchaser or bidder• to

whom such personal information is disclosed shall maintain and protect the privacy oI' such

information a~ld limit the use of such information to its e~~alu~ition o~f the Sale. and if it does not

complete a Sale, shall return all such information to the Receiver, or in the alternative destroy ail

such information. The purchaser of any P~~operty shall be entitled to continue to use the personal

information provided to it, and related to the Property purchased, in a ma~l~ler which is in all

material respects identical to the prior use of such information by the Debtor, and shall return all

other personal information to the Receiver, or ensuz~e that alI other personal information is

destro}red.

LiM~IT'ATION UN ENVIRONMENTAL LIABILITIES

16. THIS COURT ORDERS that nothing herein contained shall require tl~e Receiver to

occupy or to take control, care, charge, possession or inana~ement (separately aild/or

collectively, "Possession") of any of the Property that might be environz»entally contaminated,

might be a ~olhztar~t or a contaminant, or might cause or contribute to a spill, discharge, release

-9 -

or deposit of a substance contrary to any federal, provincial or' other law respecti~lg the

protection; conservation, enhancement, remediation or rel~iabilitation of the environment or

relating to the disposal of waste or other contamiization including, without limitation, the

C_,anadian L'n~~irof2~nentul Pf•otection Act, the Ontario Fnvironr~zentcrl P~~otection Act, the Ontario

i~~ate~ Resources f1ct, ot~ the Ontario Occupc~tinnal Heall~lz anc~ Safety ~lct and regulations

there.tulder (the "E~lvironmental Legislation"), provided however that nothing herein shall

eYelnpt the Receiver from any duty to report or make disclosure imposed by applicable

E~Zvironlnental Legislation. The Receiver- shall not, as a result of this Order or' ~ziytl~ing done in

pw•suailce of the Receiver's duties and powers ulider this Order-, be deemed to be in Possessio~l of

any of t11e Property including the Belleville Property within the meaning of any Environmental

Legislation, unless it is actually in possession.

LIIVII7'A'TION ON THE RECL.IVT12'S LTABiLITY

1 7. "I~HIS CVURT OIZl~ERS t11at the Receiver• shall incur no liability oi• obligation as a result

of its appointment or the carrying out the provisions of this Order, save and except for any gross

negligence or wilful misconduct on its part, or in respect of its obligations under sections 81.4(5)

oz' 81.6(3) of the BI11 or under the Wage Ec~Yner P~~ntectiorz P3°ograf7~~ Act. Nothing in this Order

shall derogate froiil the protections afforded the Receiver by section ] 4.06 of the BIA or by any

other applicable legislation.

I2I;CEIVER'S ACCOUNTS

18. THIS COURT ORDERS that the Receiver and counsel to the Receiver' shall be paid their

reasonable fees and disbursements, in each case at their standard rates and changes, and that the

Receiver and counsel to the Receiver- shall be entitled to and al-e hel-eby g1-anted a charge (the

"IZeceivei's Charge") on the Property, as security for such fees and disbursements, both before

ar~d after the malcin~ of this Order in respect of these proceedings, amid that the Receiver's Charge

s1~a11 for~l~ a fi7~st charge on the Propez-ty in priority to all security interests, trusts, liens, charges;

mortgage of the Tirst Mortgagee and enetni7brances, statutory or otherwise, in favour of any

Person, but sLibject to sections 14.06(7), 81.4(4), and 81.6(2) of the BIA.

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19. "THIS COUR"I' ORDERS that the Receiver and its legal counsel shall pass its accounts

~ti~om tine to time, and for this purpose the accounts of the Receiver and its legal counsel are

hereby referred to a judge of the Commercial List of the Ontario Superior Court of Justice.

20. 7'I-IIS COURT ORDERS that prior to the passing of its accounts, the Receiver shall be at

liberty fz•om tulle to time to apply reasonable amounts, out of the Monies in its hands, against its

fees and disbursements, including le;al fees and disbursements, incurred at the norn7al rates and

charges of the Receiver or its counsel, and such amounts shall constitute advances against its

remunet-ation and disbursements when and as approved ley this Court.

FUNDING OF T.HL REC~IVEI2SHiP

2L THIS COtIRT ORDERS that the Receiver be at liberty and it is hereby empowered to

borrow by way of a revolving credit or otherwise, such monies ~ti•om time to time as it n ay

consider necessary or desirabie~ provided that the outstanding principal amotult does not exceed

$350,000 (or such greater amount as this Court may by further Order authorize) at any tune, at

such rate or rates of interest as it deems advisable for such period or- periods of time as it may

arrange, for• the purpose of funding the exercise of the powers and duties conferred upon the

Receiver by this Order, including interim expenditures. The whole of the ProperCy shall be and

is hereby charged by way of a fixed and specific charge (the "Receiver's Bon~owin;s Charge") as

security for the payment of the Monies borrowed, together with interest and charges thereon, ii1

priority to all security interests, trusts, liens, charges and encumbrances, statutory or otherwise,

in favour of any Person, but subordinate in priority to the Receiver's Charge and the charges as

set out in sections 14.06(7), 81.4{4), and 81.6(2) of the BIn.

22. '1,IIIS COURT ORDERS that neither the Receivel-'s Borz~owings Charge nor al~y other

security granted by the Receiver in connection with its borrowinbs urld~r this Order shall be

enforced without leave of this Court.

23. T~IIS COURT ORDERS that the Receiver is at liberty and authorized to issue certificates

substantially in the fot~m annexed as Schedule "A" hereto (tile "Receiver's Cei-tifieates") forany

amount borrowed by it pilrsuaitt to this Order.

1 771742v3

24. THIS COURT ORDERS that the u7onies from time to time borrowed by the Receiver

pursuant to this Order or any further oi~dei~ of this Court and any and all Reccivei•'s Certificates

evidenciTig the same or an_y part thereof shall rank nn a perf•i pas.su basis, unless otherwise agreed

t~o by the holders of any prior issued Receiver's Certificates.

~~RV~ICL AND NOTICE

25. T~IIS COURT ORDERS that the E-Service Protocol of the Comnler•cial List (the

"1'rotocoP') is approved and adopted by reference hez•ein and, in this proceeding, the service o~~

documents made in accordance ~~~iih the Protocol (which can be found on the Commercial List

websitie at http://www.ontariocoul•ts.ca/scj/practice/practice-dir~ctior~s/toronto/e-service-

prot~ocol/) shall be valid and effective service. Subject to Rule 17.05 this Order shall constitute

an order for substituted service pursuant to Rule 16.04 of the Rules of Civil Procedure. Subject to

Rule 3.01(d) of the Rules of Civil Procedure. and paragraph 2l of the Protocol, service of

documents in accordance with the P~~otocol will be eflfective on transmission. This Court fin•ther

orders that a Case Website shall be established in accordance with the Protocol ~vitli the

following URL <@>'.

26. TI~IIS COUR"I~ OR17~RS that if the service or distribution of documents in accordance

with the Protocol is not practicable, the Receiver is at liberty to serve or distribute this Order, any

other• materials and orders in these proceedings, any notices or other' correspondence.. by

forwarding true copies thereof by prepaid ordinat•y mail, courier, personal delivery or facsimile

transmission to the Debtor's creditors or other interested parties at their respective addresses as

last shown on the records of the Debtor and that any such service or distributio~l by coiiriei•,

personal delivery or facsin7ile h•ansmission shall be deemed to be received o11 the neat busizless

day following the date of forwarding thereof, or if sent by ordinary mail, on the third business

day after inailin~.

GI~N~RAL

27. I~IIIS COl1RT ORDERS that the Receiver iYlay from tune to tinge apply to this Cou1•t for

advice and directions in the discharge of its .powers and duties hereunder.

1 771742v3

=12-

28. TI-I1S COURT ORDERS that nothing in this Order shall prevent the Receiver from acting

as a trustee in bankruptcy of the Debtor.

29. THIS COURT I-IEREBY 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 nut the terms of this Order.

30. THIS COURT ORDERS that the Receiver be at liberty and is hereby authorized and

empowered to apply to any court, tribunal, regulatory or administrative body, wherever located,

for the recognition of this Order and for assistance in carrying out the terms of this Order, and

that the Receiver is authorized and empowered to act as a representative in respect of the within

proceedings for the purpose of having these proceedings recognized in a jurisdiction outside

Canada.

31. TI1IS COURT ORDERS that the Applicant shall have its costs of this application, up to

and including entry and service of this Order, provided for by the terms of the Applicant's

security or, if not so provided by the Applicant's security, then on a substantial indemnity basis

to be paid by the Receiver from the Debtor's estate with such priority and at such time as this

Court may determine.

32. "I~HIS COURT ORDERS that any interested party may apply to this Court to vary or

amend this Order on not Iess than seven (7) days' notice to the Receiver and to any other party

likely to be affected by the order- sought or upon such other notice, if any, as this Court may

order. ---~--

ENTERED AT / iNSCRiT A TORON?0Old/BOOK N0:LE (DAMS LE flEGISTRE N0:

DEC 13 2016

1 771742v3 P~~ / PAR~~

scxrz~uLr <<a~~

RECEIVER CERTIFICATE

CERTIPICA"1'~ NO.

AMOUNT

1. THIS 1S "I'O CERTII'Y that [RECEIVER'S NAME], the r~eeeiver (the "Receiver") of the

assets, undert~l<in~s and properties [DFI3TOR'S NAME] acquired for, or used in relation to a

business carried on by the Debtor, including all proceeds thereof (collectively, the "Property")

appointed by Order of the Ontario Superior Court of ,iustice (Commercial List) (the "Court")

dated the of MONTH, 20YR (the "Order"} made in an action having Court file number

-CL- ,has received as sLlch Receiver from the holder of this certificate (the "Lender")

the principal sum of $ ,being park of the total principal sum of $ which the Receiver

is authorized to bori~otiv under and pursuant to the Order.____

2. The principal sum evidenced by this certificate is payable on den~ai~d by tl~e Lender• with

interest thereon calculated and compounded [daily][monthly not in advance oi~ the day o1~~

each moi7th] after the date hereof at a notional rate per annum equal to the rate of per cent

above the prime commercial lending rate of Bank of from time to time.

3. Such ~?rincipal suin with interest thereon is, by the terms of the Order, together with the

principal sums and interest thereon of all other certificates issued by the Receiver pursuant to t17e

Order o~~ to an_y further order of the Court, a charge upon the whole of the Property, in priority to

the security interests of any other person, but subject to the priority of the charges set out in the

Order and in the I3ank~•upl~cy and Insolvency.4ct, and the right of tl~e Receiver ~o indemnify itself

out of such Property in respect of its remuneration and expenses.

4. All sums payable in respect of principal and interest ur~del• phis certif~lcate are payable at

the main office of the bender at Toronto, Ontario.

5. Until all liability in respect of this certircate has been terminated, no ~ertif7cates cl~eati~lb

charges ranl<iiig or purporting to rank it1 priority to this certificate shall be issued by the Receiver

to a~~y person other t17an the holder- of this certificate without the prior written consent of tl~e

holler of this certificate.

receivership order (Uec. 13 201G).docx

-2-

6. The charge securing this certificate shall operate so as to permit the Receiver to deal with

~11e Property as authorized by the Order and as authorized vy any further or other• ordet~ of the

Court.

7. The Receiver does not undertake, and it is not under any personal liability, to pay any

sum in respect of which it may issue certificates under the terms of the Order.

D~1TI~D fhe day of MONTH, 20YR.

[RECEIVER'S NAML;], solely in its capacityas Receiver of the Property, and not in itspez•sonal capacity

Per:

Name:

"1ìtle:

receivership o~dcr (Dec. 13 2G16j.docx

Sidney Street Properties Corp. and 2428049 Ontario Inc.AUUlicant Respondent Court File No. CV-16-11 ~6~-OOCL

ONTARIOSUPERIOR COURT OF JUSTICE(COMMERCIAL LIST)


ORll~R(appointing Receiver)

BALDWIIV LAW ProfessionalCorporationBarristers &Solicitors~4 Victoria AvenueP.O. Box 1537Belleville, ON K8N SJ2

Ian W.Brad}~Gregory ParkerTel: 613-771-9991Fax: 613-771-9998I;n1ai1: ibrady~baldwinl~w.ca

~parker~c~;baldwinlaw.ca

Lmvyer•s for the Applicant, Sidne}- Street Prope~•tiesCorpo~•ation

a



COMMERCIAL LIST

B ETWEEN:SIDNEY STREET PROPERTIES CORP.

Applicant

- and -


Respondent

APPLICATION UNDER SUBSECTION 243(1) OF THE BANKRUPTCY AND INSOLVENCYACT, R.S.0 1985, c. B-3 AS AMENDED AND SECTION 101 OF THE COURTS OF JUSTICE

ACT, R.S.O 1990, c. C. 43, AS AMENDED

FIRST REPORT OF BDO CANADA LIMITED, IN ITS CAPACITYAS COURT APPOINTED RECEIVEROF 2428049 ONTARIO INC.

JANUARY 30, 2017

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TABLE OF CONTENTS

INTRODUCTION AND BACKGROUND .....................

I ntroduction ............................................................

Purpose of this Report ..........................................

Disclaimer................................................................

Background..............................................................

ACTIVITIES OF THE RECEIVER ...............................

PROPOSED MARKETING AND SALE PROCESS.......

ATTORNMENT OF RENTS ........................................

The Receivership Companies ...............................

Avaya Canada Corp ................................................

MANAGEMENT OF THE BELLEVILLE PROPERTY..

RECEIPTS AND DISBURSEMENTS ............................

RECEIVER'S BORROWINGS .....................................

PRIORITY PAYABLES/DEEMED TRUSTS ................

OTHER CREDITORS .................................................

PROFESSIONAL FEES AND DISBURSEMENTS.........

SUMMARY AND RECOMMENDATIONS ....................

.......................................................... 4

.......................................................... 4

.......................................................... 4

.......................................................... 5

.......................................................... 6

.......................................................... 9

........................................................ "11

........................................................ 13

........................................................ 14

........................................................16

........................................................ 17

........................................................ 21

........................................................ 21

........................................................ 22

........................................................ 23

........................................................ 24

........................................................ 25

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APPENDICES


B Sidney Street Properties Corp. Charge/Mortgage of Land

C Affidavit of Bernard D Ouellet sworn October 13, 2016

D Screen Printout of the Receiver's Case Website

E Rent Attornment Letters

F Strathcona and Fath PV Receivership Order of Justice Penny datedDecember 13, 2016

G Letter of Lipman, Zener ~ Waxman LLP dated January 23, 2017

H 2428049 Ontario Inc. Intercompany Accounts Ft Customer Detail Reports

Receiver's R&D Schedule

J Personal Property Security Act Registry Search dated December 19, 2016

K RCAP Equipment Lease

L BDO Canada Limited Fee Affidavit

M Fogter, Rubinoff LLP Fee Affidavit


1 Summary of Listing Proposal &Copies of Listing Proposals

2 6 Month Cash Flow Forecast

-4-

INTRODUCTION AND BACKGROUND

Introduction

1. By Order of the Honourable Justice Penny of the Ontario Superior Court of Justice

(the "Court") dated Decmeber 13, 2016 (the "Receivership Order") BDO Canada

Limited was appointed as receiver ("BDO" or the "Receiver") of the assets, properties

and undertakings of 2428049 Ontario Inc. ("242" or the "Company") pursuant to the

application of Sidney Street Properties Corp. ("Sidney" or the "Applicant"). A copy of

the Receivership Order is included hereto as Appendix A.

2. Pursuant to the Receivership Order BDO was appointed Receiver with limited

powers and duties with respect to the assets, property and undertakings of the

Company. The Receivership Order explicitly provides that 242 shall remain in possession

and control of the Belleville Property (as defined below) and that the Receiver shall not

possess, control, hold, administer and manage the Belleville Property.

Purpose of this Report

3. The purposes of this report dated January 30, 2017 (the "First Report") are to:

a) inform the Court and seek its approval of the Receiver's activities and

conduct to date, in particular with respect to the marketing and sale

process being proposed by the Receiver;

b) seek the Court's approval to list the property municipally known as 250

Sidney Street, Belleville, Ontario (the "Belleville Property")for sale with

D.W. Gould Realty Advisors Inc. ("Gould") at a list price of $3.1 million;

-5-

c) request an order sealing Confidential Appendices 1 & 2 to this First

Report, in order to preserve the integrity of the proposed marketing and

sale process for the Belleville Property and to protect certain

commercially sensitive financial information;

d) approve the Receiver's Interim Statement of Receipts and Disbursements

(the "R&tD Schedule");

e) have this Court schedule a returnable motion date regarding the issue of

post-receivership occupation rent at the Strathcona Energy Group Inc.

("Strathcona") and Fath PV Tech Inc. ("Path PV" and together with

Strathcona referred to as the "Receivership Companies") teased

premises at the Belleville Property;

f) approve the first mortgagee, Sidney, to take over administration and

management of the Belleville Property and to have alt future

expenditures made by Sidney regarding the administration and

management of the Belleville Property funded through the issuance of

Receiver's Certificates; and

g) approve the fees and disbursements of the Receiver and its le~at counsel,

Fogter, Rubinoff LLP ("Fouler") as set out in this First Report, and

authorize the Receiver to pay all approved and unpaid fees and

disbursements.

Disclaimer

4. This First Report is prepared solely for the use of the Court, for the purpose of

assisting the Court in making a determination whether to approve: (i) the marketing and

sale process being proposed by the Receiver in respect of the Belleville Property; (ii)

management of the Belleville Property by Sidney; and (iii) other ancillary relief being

sought.

-6-

5. Unless otherwise stated, all monetary amounts contained in this First Report are

expressed in Canadian dollars.

Background

6. 242 is an Ontario corporation. The Receiver understands that Karl Hollett is the

President, Secretary and sole director of 242. The Company's sole purpose appears to

be that of ownership of the Belleville Property.

7. The Belleville Property consists of approximately 33 acres of land with a

305,000 square foot building and ancillary buildings currently occupied by 7 tenants, of

which only 4 tenants have paid rent to the Receiver.

8. 242 has owned the Belleville Property since October 15, 2014 when it acquired

the property from Sidney and Palmer Road Properties Corp. ("Palmer") for $3.1 million.

As security for the sale of the Belleville Property, Sidney was granted by 242 a vendor-

take-back mortgage in the principal amount of $2.17 million pursuant to

Charge/Mortgage dated October 15, 2014 (the "Mortgage") that was registered against

the Belleville Property. A copy of the Mortgage is included hereto as Appendix B.

9. Given the significant environmental problems associated with the Belleville

Property, the Ministry of Environment, now the Ministry of the Environment and Climate

Change ("MOECC"), registered a Certificate of Requirement against title to the

Belleville Property pursuant to the Environmental Protection Act with respect to certain

Director's Orders and related proceedings before the Environmental Review Tribunal.

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10. The Belleville Property was originally owned by Nortel Networks Limited

("Nortet") or its corporate predecessors and has significant environmental issues

allegedly caused by the manufacturing of electrical components for the

telecommunications industry. The environmental issues associated with the Belleville

Property, and other impacted properties owned by Nortel, have been dealt with by this

Court in Nortet's proceedings under the Companies' Creditors Arrangement Act (the

"CCAA").

1 1. Sidney and Palmer filed an "Amended Proof of Loss re: Nortel Networks

Corporation" claiming an amount of approximately $34.4 to $51.4 million in relation to

alleged obligations of Nortel to Sidney regarding environmental matters at the Belleville

Property in the Nortel CCAA proceedings.

12. At Paragraphs 74 and 75 of a recent Monitor's report regarding the sanction

hearing in the Nortel CCAA proceedings, it states that approximately $155 million is

being set aside for continuing, post-sanction administrative and wind-down steps, of

which approximately $55 million relates primarily to wind-down costs and obligations

and the balance (i.e. $100 million) relates primarily to a reserve established in respect

of the continuing performance obligations of Nortel pursuant to the MOECC Orders,

including the MOECC Order on the Belleville Property.

1 3. The Monitor's Report continues to state at Paragraph 75: "This reserve amount

is being established and held without prejudice both as to whether Nortel will continue

to perform such obligations following the Plan Implementation Date as well as with

respect to the nature and quantum of Nortel's liability, if any, pursuant to the MOECC

Orders and any related Proofs of Claims, including on the basis previously agreed among

the MOECC, Nortel and Monitor pursuant to the Agreement re: Kingston Property

Settlement and other Nortet ERT Proceedings dated February 25, 2015. For the

avoidance of doubt, no relief is sought at present with respect to Nortel's obligations

pursuant to the MOECC Orders. The Monitor expects to engage with the MOECC and

other relevant stakeholders with respect to the MOECC Orders and related Proofs of

Claim with a view to achieving full and final resolution of Nortel's environmental

obti~ations over the course of 2017."

14. The Belleville Property is also currently the subject matter of several other legal

proceedings. This receivership is generally over the real property and the limited powers

of the Receiver to sell the Belleville Property and collect rents from the tenants. The

Receivership Companies, related companies to 242 by common ownership through Kart

Hollett, are in receivership pursuant to a court application of Royal Bank of Canada

("RBC"). In addition, Business Development Bank of Canada ("BDC") has appointed a

private receiver over specific collateral or equipment owned by the Receivership

Companies that is located at the Belleville Property. Lastly, Avaya Inc., a corporate

affiliate of Avaya Canada Corp., the anchor tenant at the Belleville Property, recently

filed for bankruptcy protection in the United States pursuant to Chapter 11 of the US

Bankruptcy Code.

1 5. To complicate the multiplicity of proceedings regarding this single property are

the environmental issues facing the Belleville Property and the potential liability of any

party taking possession of the property. Past and current owners of the Belleville

Property, including Sidney as a past owner, are allegedly subject to the MOECC

Director's Order regarding the Belleville Property and the related proceedings before

the Environmental Review Tribunal.

-9-

16. 242 is currently in default of its obligations under the Mortgage ultimately

leading to this receivership proceeding. 242 is currently indebted to Sidney in excess of

$1.82 million.

17. Further alleged background information leading up to the receivership

proceeding and outlining in further detail the altered history of environmental

contamination at the Belleville Property and the ongoing environmental work and

remediation at the Belleville Property is included in the affidavit of Bernard D. Ouellet

sworn October 13, 2016 (the "Ouellet Affidavit") attached, without exhibits, as

Appendix C.

ACTIVITIES OF THE RECEIVER

18. Pursuant to the Receivership Order the following is a summary of the more

salient activities of the Receiver:

(a) preparing and issuing the prescribed Notice and Statement of the Receiver

pursuant to sections 245 (1) and 246 (1) of the Bankruptcy and Insolvency

Act, which was forwarded to the Office of the Superintendent of Bankruptcy

and the Company's creditors;

(b) attorning the rents at the Belleville Property;

(c) setting up a case website at http://extranets.bdo.ca/24280490ntariolnc , a

screen print out of the Receiver's case website page is attached hereto as

Appendix D;

(d) administering the Wage Earner Protection Program Act ("WEPPA") for the

former employees of 242;

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(e) assisting 242 to prepare asix-month cash flow forecast to submit to Sidney

to present the Company's cash flow requirements over the same period;

(f) reviewing the adequacy of the current insurance for the Belleville Property;

(g) liaising with the insurance adjuster, Intact Insurance, in view of this

receivership proceeding, to confirm coverage in respect of the Company's

insurance claim for the replacement of a "blown" transformer and to ensure

that the replacement of the transformer proceeds on schedule;

(h) contacting the utility companies to have them complete final readings and

submit claims to the Receiver for pre-receivership arrears and to arrange for

new accounts to be set up in the name of 242 for the supply of post-

receivership services;

(i) obtaining listing proposals from two commercial real estate brokers to list

the Belleville Property for sale;

(j) arranging for trust examinations to be completed by Canada Revenue Agency

("CRA") of 242's payroll and HST accounts;

(k) holding discussions and reviewing information to better understand the

nature of the Belleville Property;

(l) dealing with Avaya Canada Corp., and its counsel, to attempt to resolve an

ongoing rent dispute;

(m)communicatino with the receivers of the Receivership Companies to deal with

the collection of occupation rent;

(n) arranging with Sidney to borrow money under Receiver's Certificates and

advancing those funds to 242 so that it can continue to pay its ongoing

operating costs and building maintenance expenses; and

(o) dealing with creditor inquiries.

-11-

PROPOSED MARKETING AND SALE PROCESS

19. Among the powers set out in the Receivership Order, the Receiver is empowered

and authorized in Paragraph 3(c) to, inter a(ia, market any or all of the Belleville

Property, including advertising and soliciting offers in respect of the Belleville Property

or any part or parts thereof and negotiating such terms and conditions of sale as the

Receiver in its discretion may deem appropriate. Pursuant to its duties, the Receiver

considered the merits of the following options: i) a marketing and sale process

conducted by the Receiver with pre-determined terms and conditions of sale and a set

deadline date for the submission of offers; and ii) listing the Belleville Property for sale

with a commercial real estate broker.

20. Given the fotlowin~: i) the significant environmental issues facing the Belleville

Property and the potential liability to any party purchasing the property; ii) a buyer not

being able to obtain traditional bank financing for this type of transaction because of

the property's environmental issues; iii) the very limited market for this type of risky

real estate opportunity; and iv) the lengthy timeframe required to attract a buyer in

the circumstances, the Receiver has concluded that listing the Belleville Property for

sale with a commercial broker is likely the best option to maximize recovery for the

creditors. Commercial real estate brokers wilt expose the Belleville Property to the

public on MLS and ICX, have experience selling environmentally contaminated properties

and have a network of contacts and other clientele to expose this risky real estate

opportunity to.

21. Further to this end, the Receiver has obtained listing proposals from the

following commercial brokers:

-12-

i. Gould; and

ii. Colliers International ("Colliers")

Each of the above listing proposals contain a suggested list price based on a property

comparable analysis, sale commission structure, proposed marketing efforts and

relevant experience. A table summarizing the salient details of the listing proposals

together with copies of the proposals is included hereto as Confidential Appendix 1.

22. There is a large spread in suggested list prices for the property contained in the

brokers' listing proposals. This is essentially due to the unknown costs required to

remediate the property. More recently, contamination was discovered at the south east

corner of the property where there has apparently been offsite migration to neighboring

properties. The extent of the migration on to neighboring properties will not be known

for certain until the first quarter of 2017 when environmental engineers wilt have

completed testing and rendered a report with a remediation budget.

23. After careful consideration of the listing proposals received, and given that the

Belleville Property recently sold for $3.1 million in October 2014 and is an indicator of

the relative market value of the property, the Receiver recommends listing the

Belleville Property for sate with Gould at an initial list price of $3.1 million which the

Receiver will periodically review as necessary.

24. In particular, the Receiver has considered the following in selecting Gould:

(a) Gould's commission is competitive and lower than the other competing

broker;

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(b) the capabilities, qualifications of the listing agent which demonstrate a

strong reputation and a high degree of competence; and

(c) the listing agent's past history with this property.

25. Gould completed the sale of the Belleville Property for $3.1 million in October

2014 and has intimate knowledge of the past history and current state of the

environmental problems associated with the property thereby eliminating the need and

time for any due diligence. Additionally, Gould has already spent considerable effort

"mining" contacts for this particular property. Ultimately, Gould's proposal appears to

be the most favourable in the circumstances.

26. The main stakeholder and first mortgagee, Sidney, currently funding 242's

operations to preserve value of the Belleville Property for the creditors, supports the

Receiver's decision to list the Belleville Property for sale with Gould at an initial list

price of $3.1 million.

ATTORNMENT OF RENTS

27. Pursuant to Paragraph 3(b) of the Receivership Order, the Receiver has notified

the existing tenants of the Belleville Property of the receivership proceeding and has

attorned the rents. Copies of the rent attornment letters are attached hereto as

Appendix E.

28. The Receiver has received January 2017 rent from the following tenants,

Hastings County, Grant ~t Gaber Physiotherapy, 121 Fitness and Metroland Media Group.

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Rent is still owing by the following tenants, Avaya Canada Corp., Strathcona and Fath

The Receivership Companies

29. BDO has contacted Fuller Landau LLP ("Fuller"), the court-appointed receiver

of the Receivership Companies, seeking the payment of January 2017 occupation rent.

The Receiver understands that Futter lacks funding and has had to borrow money to fund

the receivership.

30. Pursuant to Paragraph 2.1 of the receivership order appointing Fuller as receiver

attached hereto as Appendix F, Fuller has taken the position that it is not in possession

of the Receivership Companies' leased premises. Fuller continues to pay certain

operating expenses and fund payroll for Strathcona employees operating from the

Belleville Property while it is attempting to solicit buyers for Strathcona's contracts and

realize on the Receivership Companies' assets. Moreover, Fuller contends (as does MSI

Sper~el Inc. as set out below) that there is apre-receivership debt of approximately

$277,202 owing by 242 to Strathcona and that the tatter is exercising a right of set-off

of the pre-receivership obligation of 242 against the Receiver for post-receivership

occupation rent.

31. BDC has appointed a private receiver, MSI Spergel Inc. ("Spergel"), to deal with

certain equipment ptedoed to BDC as collateral for its loans to the Receivership

Companies. As stated, Spergel has taken the position that Strathcona has a right of set-

off of the pre-receivership obligations of 242 against the Receiver for post-receivership

occupation rent. Attached as Appendix G, is a letter from Lipman, Zener &Waxman

LLP, counsel for BDC, advising that Strathcona is exercising an appropriate right of set-

-15-

off of the pre-receivership obligation of 242 against the Receiver for post-receivership

occupation rent.

32. The Receiver attaches hereto as Appendix H, general ledger summaries of the

intercompany accounts for Strathcona and Fath PV and the Customer Balance Detail

reports for Strathcona and Fath PV. The foltowin~ is a summary of the Intercompany

indebtedness based on the records of 242:

242 Strathcona Fath PV

Intercompany account $ (277,202.27) Credit $ 113,435.00 Debit

A/R Led~er(re: outstanding rent obligations) 149,786.99 Debit 415,401.90 Debit

Net amount owing to 242/(owing by 242) $ (127,415.28) Credit $ 528,836.90 Debit

Based on the records of 242, it appears that Fath PV is indebted to 242 in the amount

of $528,836 and that 242 is indebted to Strathcona in the amount of $127,415.

33. Despite repeated requests to 242 and the Receivership Companies, neither the

Receiver, Fuller nor Spergel have been provided with any teases between 242 and the

Receivership Companies to the Receiver's knowledge. All that the Receiver has received

from 242 is the Customer Balance Detail reports that show rent being charged to the

Receivership Companies by 242. Payment of rent during the past calendar year appears

to have been made by Strathcona in the amount of $76,000 for outstanding rent from

October 2015 to March 2016, however, no rent payments appear to have been made by

Fath PV since October 2015.

34. The Receiver understands that the Receivership Companies own certain

manufacturing equipment located at the Belleville Property and a liquidator has been

-16-

en~a~ed to sort out what equipment is subject to the security interests of RBC and BDC.

The Receiver believes that the majority of the manufacturing equipment is owned by

Fath PV as the manufacturing arm of Strathcona. The Receiver is advised that

manufacturing equipment with a book value of over $4.0 million was purchased by Fath

PV from Ectipsatl.

35. Sperget has not addressed the issue of payment of occupation rent for Fath PV.

It also appears that aset-off argument, whether proper in the current circumstances as

it pertains to Strathcona, cannot be made when it comes to the payment of occupation

rent for Fath PV.

36. The Receiver believes that it is inequitable that occupation rent is not being paid

by either Fuller or Spergel while Strathcona continues to operate, albeit on a very

limited scale, and the Receivership Companies' equipment and other assets stilt remain

at the Belleville premises and wilt eventually be realized upon, removed or abandoned

by the respective receivers. In the circumstances, the Receiver takes the position that

it is entitled to be paid post-receivership occupation rent.

37. Accordingly, the Receiver requests this Honourable Court to schedule a

returnable motion date regarding the issue of post-receivership occupation rent in

respect of the Receivership Companies' teased premises.

Avaya Canada Corp.

38. The Receiver has held discussions with counsel acting for the main anchor tenant,

Avaya Canada Corp., with regard to a rent dispute that existed prior to the receivership.

-17-

39. At the time of drafting this First Report, the Receiver is advised by Avaya Canada

Corp. that a rent reconciliation statement will be provided to the Receiver in due course

and that Avaya intends to pay what it believes to be the January and February 2017 rent

...

40. The Receiver, assisted by 242, wilt continue to work collaboratively with Avaya

Canada Corp. in an attempt to resolve the rent dispute/reconciliation issues and will

accept rent payments from Avaya Canada Corp. on a "without prejudice" basis in the

circumstances.

41. The Receiver is also advised by Avaya Canada Corp.'s counsel and understands

from press releases that the Chapter 11 Bankruptcy proceedings initiated pursuant to

the US Bankruptcy Code by Avaya Inc. do not extend to the company's foreign affiliates

and so Avaya Canada Corp. wilt remain unaffected by those proceedings.

MANAGEMENT OF THE BELLEVILLE PROPERTY

42. At the date of receivership, the Company had approximately $1,000 in its bank

accounts. The Company employed 3 staff, an engineer, an IT specialist and an

administrative assistant. An accountant employed by Strathcona is also 242's

bookkeeper. Additionally, an electrician formerly employed by Strathcona spent

considerable time assisting the engineer employed by 242 with the overall care and day-

to-day maintenance of the Belleville Property. The owner Karl Hollett and his wife,

Susanne Holtett, although signing officers of 242, are not employees of the Company.

43. At the onset of the receivership, 242 was faced with a multitude of problems

that needed to be addressed by the Receiver on an urgent basis for 242 to comply with

its landlord obligations and for the Receiver to ultimately preserve and protect the value

of the Belleville Property under its authority to sell the property for the benefit of 242's

creditors. One of the Company's electrical transformers was not working and needed

replacement. The Company's insurer had been investigating the incident since October

2016 to confirm insurance coverage and had not completed its investigation.

Consequently, the back-up generator was being used to power the building while

indirectly providing heat to certain sections of the building by powering rooftop heater

fans to disburse heat from the gas heaters. The back-up generator runs on fuel so 242

continues to order large quantities of fuel at a cost in the range of $4,000 to $5,000 per

week. Given the prolonged use of the back-up generator, it was overheating and

required repair. Additionally, the boiler system that heats other sections of the building

was in a state of disrepair and needed immediate maintenance. A water softener

needed replacement for the boiler to run properly and boiler chemicals needed to be

ordered. In the event that either the boiler system or back-up generator fail, sections

of the building will be without power and heat disrupting the existing tenants'

businesses and possibly causing water pipes to freeze and burst. Additionally, there

were a number of leaks in the building's roof needing repair estimated to cost around

$20,000 to fix. Lastly, 242's annual fire life safety inspection was overdue likely in

violation of the Fire Code and the supplier initially refused to continue to supply its

services to 242 until its overdue account totaling approximately $10,000 was paid.

44. Given 242's lack of funds and knowing that future rents were not coming due

until January 2017, the Receiver had to immediately approach the first mortgagee,

-19-

Sidney, to borrow money to advance to 242 to fund payroll and cover the more

immediate maintenance and repair costs.

45. The Company had been ordering fuel for the back-up generator on credit since

October 2016 and the insurer provided a cheque in the amount of $9,669, under the

"extra expense coverage for equipment breakdown" section of 242's policy, to cover

fuel costs for a couple of weeks until the end of December 2016. The insurer has now

confirmed coverage of the replacement transformer, however, "extra expense coverage

for equipment breakdown" under the policy is limited to $25,000. The fuel account

balance as at January 20, 2017 was $37,334 less $15,331 still to be covered by the insurer

under the policy, (eaves a net balance currently owing by 242 to the fuel supplier of

approximately $22,003.

46. Currently, there is a vacuum in the management of the Belleville Property.

There are several reasons for this problem: (i) the Company tacks the funds to manage

the Belleville Property; (ii) the Receiver lacks the authority under the Receivership

Order to take possession and manage the property and refuses to do so in light of the

potential significant environmental liabilities that may arise by possessing the property;

and (iii) other parties have refused to take possession of the Belleville Property or some

of the leased premises for similar reasons.

47. Given the insolvency of the Receivership Companies, the current rent roll is

insufficient to cover the significant carrying costs of the Belleville Property. A cash flow

projection prepared by 242 showed that over the next six months the Company could

experience a cash flow deficit of nearly $300,000, excluding payment of the Mortgage

-?0-

and after deferring payment of property taxes. A copy of the Company's 6 month cash

flow forecast is included hereto as Confidential Appendix 2.

48. Given the size of this tenanted building, 242 will likely require the services of a

competent manager, the building engineer, Strathcona's former electrician and a

bookkeeper to effectively manage the Belleville Property.

49. As a result of insufficient funds and tack of resources, 242 has been unable to

adequately administer and manage the Belleville Property during the receivership. The

Receiver is therefore requestin6 that the administration and management of the

Belleville Property be turned over to Sidney.

50. Sidney has agreed to assume responsibility for managing the Belleville Property.

Sidney is a previous owner of the Belleville Property and has familiarity with the

property. Also, as a former owner, Sidney is already subject to the MOECC Director's

Order regarding the property. Furthermore, Sidney has been funding the receivership.

Finally, under the Mortgage, on default, Sidney has several rights and remedies including

the right to enter and take possession of the Belleville Property, to repair the property

and to insure the property. The Receivership Order generally "carves-out" or excludes

Sidney's Mortgage from the effect of the Order.

51. Absent the significant environmental liabilities associated with the property, the

Receiver would otherwise be collecting rents and borrowing funds from Sidney through

the issuance of Receiver's Certificates to carry on 242's business to manage the

Belleville Property until the property is sold. Should this Court approve Sidney taking

over administration and management of the Belleville Property, Sidney has asked the

-21-

Receiver to seek the Court's approval to have future expenditures made by Sidney to

manage the Belleville Property continue to be advanced to the Receiver through the

issuance of Receiver's Certificates and have the Receiver continue to be a conduit to

advance the funds to 242. Additionally, the Receiver is seeking approval to use the rent

monies collected by it to also fund 242's operating costs from time to time at the

Receiver's discretion without further order of the Court.

RECEIPTS AND DISBURSEMENTS

52. The R~tD Schedule, attached hereto as Appendix I, reports net receipts over

disbursements for the period of $15,803.39 before provision for payment of outstanding

professional fees of the Receiver and that of its counsel.

53. The Receiver, among other relief, is seeking the Court's approval of its R&D

Schedule.

RECEIVER'S BORROWINGS

54. As stated, the Receiver needed to borrow $35,000 from Sidney through the

issuance of Receiver's certificates in order to provide 242 with adequate funding to pay

ongoing operating costs and cover maintenance and repairs costs to preserve the value

of the Belleville Property for the benefit of the creditors.

55. The Receiver is paying interest on the borrowed funds at an annual interest rate

of 10% which was negotiated with Sidney. Sidney is the only logical party that would

provide funding to the Receiver in these circumstances.

_~~_

PRIORITY PAYABLES/DEEMED TRUSTS

56. The Receiver has contacted CRA to complete HST and payroll source deduction

trust examinations to confirm 242's deemed trust liabilities. The trust examinations

have not yet been finalized and so CRA has not filed its deemed trust claims with the

Receiver. The Receiver understands that 242, subject to CRA verification, has

outstanding HST payable totaling $172,461 and unremitted payroll deductions totaling

$26,350. The HST payable may be greater than that reported above as it is typical for

CRA to reverse input tax credits for creditor claims that remain unpaid in the

receivership to adjust the input tax credits claimed by 242 from an "accrual" to "cash"

basis of reporting.

57. The Receiver sent notice to former 242 employees advising them of the existence

of, and their rights under, the WEPPA. The Receiver also provided the former 242

employees with a Proof of Claim form in order for them to file claims with the Receiver

for outstanding wages, expenses, vacation, termination and severance pay. The

Receiver determined that up to $2,166.30 is payable by the Receiver, out of any

recovery from the current assets of 242, in respect of subrogated employee claims under

WEPPA that are otherwise payable by the Receiver under Section 81.4 (1) of the BIA.

58. Lastly, the Receiver understands that there is approximately $165,182 in

outstanding property taxes due to the City of Belleville that wilt form a first charge on

the Belleville Property ahead of Sidney's Mortgage.

-23-

OTHER CREDITORS

59. Other secured creditors of 242 include RCAP Leasing Inc. ("RCAP") and Trisura

Guarantee Insurance Company ("Trisura"). These secured creditors' security interests

appear to be over the personal property of 242. Attached hereto as Appendix J, is a

copy of the Personal Property Security Act search against 242 as of December 19, 2016.

60. The Receiver understands that 242 is a guarantor to Trisura, the insurance

company that bonded certain Strathcona contracts. Trisura's registration appears to be

a general collateral registration over all 242's personal property.

61. The Receiver has been contacted by RCAP and provided with a lease for the

purchase of what is described as office equipment. The lease is a 5 year tease

commencing on or around February 5, 2015 with monthly payments of $3,670.16. The

RCAP lease is in default for non-payment and RCAP reports that it is currently owed

$220,144 under the contract. Additionally, RCAP claims they have a perfected Purchase

Money Security Interest ("PMSI") in the office equipment. A copy of the RCAP lease is

appended hereto as Appendix K.

62. Upon further review of the asset schedule attached to the RCAP lease, it appears

the lease covers the installation and construction of glass partitioned office space and

includes the installation of metal studs, flooring, glass wads and doors. The Receiver

understands that the RCAP lease pertains to the construction of Metroland Media

Group's partitioned teased office space at the Belleville Property.

63. Strathcona is the lessee on this RCAP lease. Strathcona is in receivership. Under

the Strathcona receivership order, RCAP appears to be "stayed" from removing the

-24-

equipment but entitled to post-receivership lease payments. The Receiver surmises

that RCAP may have approached Strathcona's receiver, Fuller, to request post-

receivership lease payments and may have been refused by Fuller.

64. 242 is the co-lessee on the RCAP lease. Pursuant to the Receivership Order,

RCAP appears to be "stayed" from removing the equipment but entitled to post-

receivership lease payments. Pursuant to the Receivership Order, 242 shall remain in

the possession and control of the property.

65. 242 is unwilling or unable to make the lease payments to RCAP. The Receiver

also understands that Sidney is unwilling to fund 242 to make the lease payments to

e'

66. RCAP is being served with the Receiver's motion record returnable February 9,

2017 and wilt be able to appear and make submissions to the Court it feels are

appropriate in the circumstances.

PROFESSIONAL FEES AND DISBURSEMENTS

67. Pursuant to the Receivership Order, the Receiver has provided services and

incurred disbursements which are more particularly described in the affidavit and

detailed invoices attached hereto as Appendix L.

68. The detailed time descriptions contained in the invoices provide a fair and

accurate description of the services provided and the amounts charged by BDO as

Receiver. Included with the invoices is a summary of the time charges of partners and

-25-

staff, whose services are reflected in the invoices, including the total fees and hours

billed.

69. Additionally, the Receiver has incurred legal fees of its counsel in respect of

these proceedings, as more particularly set out in the fee affidavit and exhibits attached

hereto as Appendix M.

70. The Receiver has reviewed Fogler's fee affidavit and believes same to be fair

and reasonable in the circumstances

71. The Receiver requests that the Court approve its accounts for the period from

December 12, 2016 to January 27, 2017 in the amount of $43,673.16 for fees and

disbursements including HST of $5,677.51 for a total of $49,350.67.

72. The Receiver also requests that the Court approve the accounts of its legal

counsel for the period from December 12, 2016 to January 27, 2017 in the amount of

$42,084.25 for fees and disbursements including HST of $5,450.80, for a total of

$47,535.05.

73. Additional time will be required to complete the Receiver's mandate.

SUMMARY AND RECOMMENDATIONS

74. Based on the foregoing, the Receiver recommends that the Court:

a) approve this First Report of the Receiver, and the activities and conduct

of the Receiver set out herein;

b) approve the marketing and sale process proposed by the Receiver,

specifically to list the property with Gould at a list price of $3.1 million;

c) seal Confidential Appendices 1 & 2 in order to preserve the integrity of

the marketing and sale processes and to protect commercially sensitive

financial information until further Order of this Honourable Court;

-?6-

d) approve the Receiver's R&D Schedule;

e) approve the first mortgagee, Sidney, to take over administration and

management of the Belleville Property and to have all future

expenditures made by Sidney regarding the administration and

management of the Belleville Property funded through the issuance of

Receiver's Certificates;

f) schedule a returnable motion date regarding the issue of post-

receivership occupation rent in respect of the Receivership Companies'

leased premises at the Belleville Property; and

g) approve the fees and disbursements of the Receiver and its legal counsel,

Fouler, as set out in this First Report, and authorize the Receiver to pay

all approved and unpaid fees and disbursements.

Alt of which is respectfully submitted this 30~h day of January, 2017.

BDO CANADA LIMITED Court Appointed Receiver of2428049 Ontario Inc.Per:

Name: Gary Cerrato, CIRPTitle: Vice-President

a

Court File Na. CV-16-11565-0OCL

SUPERIOR COURT OF JUSTICE(COMMERCIAL LIST}

7'HE HONUURABI.E ) THURSDAY, THE 9~~'

JUSTICE HA[NEY ) QAY ~F FEBRUARY 2017

BETWEEN:

SIDNEY STREET PRt3PERTIES CORP.

Applicant

- and

2428049 (?N7ARI41NC.

Respondent

~.~ .

THIS MOTION, made by BDO Canada Limited, in its capacity as court-appointed

receiver (in such capaciiy, the "Receiver"} of 2428049 Ontario lnc. (the "Debtor"), appointed

pursuant #o the court Order dated December 13, 2016, for an Order:

ta} validating the service of the Notice of Mohan, the Mtition Record and fhe First

Report of the Receiver dated January 30, 2 17 {the "First Report") so that this

Motion is properly returnable today and dispensing with further service thereof;

(b) approving the Firsi Report and the activities of the Receiver as described therein;

(c) authorizing and directing the Receiver to list the real property of the Debtor

loco#ed at 250 Sidney S#ree#, Belleville, Qntario (the "Bellevili~ Property") for

sale wi#h D.W. Gould Realty Advisors Inc., as described in the First Report;

(d) approving the sealing of Confidential Appendices "1" and "2" to the First Repart

until further order of this Court;

(e) approving the Receiver's Interim Statement of Receipts and Disbursements

included in the First Report;

(fl approving the interim fees and disbursements of the Receiver and its counsel as

set out in the First Report and authorizing the Receiver to pay ail approved,

unpaid fees and disbursements;

(g) scheduling a returnable motion date regarding the issue of post-receivership

occupation rent at the Strathcona/Path leased premises at the Belleville Property;

(h} approving the Applicant taking over the administration and management of the

Belleville Property and being paid for future costs or expenses regarding the

administration and management of the Belleville Property by the issuance of

Receiver's Certificates; and

(i) authorizing the Receiver in its own discretion, without further order of the Court,

to use or apply the rental money or funds collected from the tenants of the

Belleville Property in order to fund the Debtor's opera#ing costs during the

receivership,

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

ON READING the material filed, including the Notice of Motion, the First Report

and the appendices thereto, and on hearing the submissions of counsel for the Receiver and

anyone else appearing for any other party on the Service List as duly served as appears from

the Affidavit of Service of Silvana Pocino, sworn January 31, 2017, filed;

SERVICE

1. THtS COURT ORDERS that the time for service of the Noiice of Motion, the

Motion Record and the First Report is hereby abridged and validated so that this motion is

properly returnable today and hereby dispenses with further service thereof.

-3-

RECEIVER'S ACTIVITIES

2. THIS COURT ORDERS that the First Report and the activities of the Receiver as

described therein are hereby approved.

LISTING OF REAL PROPERTY

3. THIS COURT ORDERS that the proposed listing for sale of the Belleville

Property, as described in the First Report, is hereby approved.

4. THIS COURT ORDERS that the Receiver is hereby authorized and directed to

list for sale the Belleville Property, as described in the First Report.

5. THIS COURT ORDERS that the Receiver shall have no personal or corporate

liability in connection with the listing for sale of the Belleville Property, excepting any liability

resulting from gross negligence or wilful misconduct.

SEALING

6. THIS COURT ORDERS AND DECLARES that Confidential Appendices "1" and

"2" to the First Report are hereby sealed until further order of this Court.

RECEIVER'S INTERIM STATEMENT

7. THIS COURT ORDERS that the Receiver's Interim Statement of Receipts and

Disbursements included in the First Report is hereby approved.

INTERIM FEES AND DISBURSEMENTS

8. THIS COURT ORDERS that the interim fees and disbursements of the Receiver,

for the period December 12, 2016 to January 27, 2017, in the amount of $49,350.67 including

taxes, is hereby approved.

9. THIS COURT ORDERS That the interim fees and disbursements of the

Receiver's counsel, for the period December 12, 2016 to January 27, 2017, in the amount of

$47,535.05 including taxes, is hereby approved.

10. THES COURT aRaERS AND AUTHORIZES the Receiver to pay all courf-

approved, unpaid fees and disbursements.

SCHEDULING

17. THES COURT ORDERS AND D1REC7S that a motion be returnable on the date

and timetable set out in this Court's indorsement regarding the issue of post-receivership

occupation rent at the StrathconalFath Eeased premises at the Belleville i'roperty.

MANAGEMENT

12. THIS CQURT AUTHORIZES the Applicant to operate, adrrtinister and manage

the Belleville Property during this receivership and #o be paid for its future casts or expenses

regarding the administration and management of the Belleviil~ Property by the issuance of

Receiver's Cer#ificates.

QPERATlNG COSTS

13. THIS COURT AUTHC3RfZES the Receiver in its own discretion, WI~I10Ut ~Ul~~l~f

order of the Court, to use or apply the rental money or funds collected from the tenanis of the

Belleville Property in order to fund fhe Debtor`s operating costs during the receivership.

t~N t BOOK Nd:!_~ 1 [~A(~S ~ ~ .Reis-;~~ yC7,

~~~ ~ ~ ~~~

~~~'EF~ 1 i',~Ft_~

r

SIDNEY STREET PROPERTIES CORP. - and - 2428049 ONTARIO INC.Applicant Respondent

Court File No. CV-1 6-1 1 565-OOCL


{COMMERCIAL LIST)


~~ . ~

FOGLER, RUBINOFF LLPLawyers77 King Street WestSuite 3000, P.O. Box 95TD CentreToronto, Ontario M5K 1 G8

Vern W. Dane (LSUC# 32591 EjTel: 416-941-8842Fax: 416-941-8852

Lawyers for the court-appointedReceiver of fhe Respondent, BDOCanada Limited

to

:~ o~~RQ R~E~ mot$ o~~~r~ i~h ~ ~~ ~I15SQCE81tIIft ~~~'

~~~ ~ ~ ~ ~~for vso ir, .he Province of On~oric

Y[~e FtEQLi04~~ Consee¢r~es ~efationship

In Onlorio, the teat estola profession is governed by the Reol Estate andBusiness Brokers Act, 2002, and Associated Regulatio~a (REBBA 2002 orAcij, adminis'ered by the Reol Estate Council of Oniorio (RECO~. Ail OnroriaREAL70RS" are registered under the A.ct and governed by ihs provisions. REBSA2002 is consumer pro;ec}ion legislation, regufaling the conduct of real estatebrokerages end their salespeople/brokers. The Act provides consumer protectionin If~e term of depes;t insurance and requires every salesperson/broker to curryerrors & omission ~EROJ insurance.

When you choose to use the services of a Rt:ACTOR~, it is imporiar,E to understoodthat this individual works on baholf of a real esrcte brokerage, usually acompcny. The brokerage is eperaled by a Broker of Record, who has the ultimateresponsibility foi• the errplcyees registered with the brokerage. When you signa ccniract, it is ~vilh the brokerage, not with the salesperson/broker employee.

The Act also requires thot the brokerage {usually through its R~TCRS~'J explainthe types of _eivice olterrotives availoble io consumers and the services thebrokerage will b~a providing. The brokerage must document the relationship beingcreated between tho brokerage and the consumer, and submit it to the consumerfar his/her approvoi and sigrah~re. The most commor relationships are "dienY'and "customer", bud other options may be mailable in the morkelpiece.

CEierF

A "client" relationship creates the highest form of obligation for a REAL70R"to a consumer. The brokerage and its salespeople/brokers have o fiduciary((egola relationship with the client and represent the interests cf fho client in areal estate transccdion. The REALTOP,'' wi[f establish this relQtion~hip with the useof a represenlnlion agreement, coiled a tisfirg Agreement with the :alter orala Buyer Represontoticn Agreement with the buyer. The agreement contains anexplanation of the services the brokerage wiI! be pravidina, the Eee arrangementfor those services, the obligations the client will have under the agreement, andthe expiry dote of the Agreement. Ensure shat you have read and fully understandany such cgreerc:ent before you sign tf~e document

Once o bra&erege and a consumer enter into a client relat~onsh~p, the brokeragemust prefect the interests of the cGenr and oo what is best for the client. Abrokerage mvsF <trive for the benefit of the client and must not disclose o clientsconfidential informakion io others. Under the Act, the brok=_toga must also makereasonable efforts fo determine any mcterial facts relating to the transactionthat would be of fiferest !o the cfienf and mus! inform the client of Ehose fccts.Although they are representing the interests of their client, Ehey must ssil( treat altparties to tfie transaction wish fairness, honesty, cod integrity.

C~54omer

A buyer cr seller may not wish to be under cortract as a client with thebrokerage but wculd rasher be treated as a customer. A REALTORS is obligatedto freot every person in a real estate Transaction wish hcnesty, fairness, oralintegrity, but unlike a client, provides a customer with a res~rided level ofservice. Services provided to a customer may include shawinp the propertyor properties, drafting fhe offer, presenting the offer, etc. 3rokerages use aCustomer Service Agreement to document the services they are ~rovlding to 0buyer or seller ccstomer.

Under the Act, the REAL?OR'' bas disclosure obligations to a customer and mustdisclose material (acts krown to the orokerage thaF relate fo the transaction.

s~~aF t9appens /hen...

Buyer;s~ one the sellerss) are sometimes under ccntract with the same brokeragewhen properties ore beirg shown or on offer is being contemplated. There conolso be instances when there is more than one offer on o property and morethan one buyer and seller are under a representatior agreement with the somebrotcerage. This situation is referred to as muifip(e representation. Under theAd, the P,EALTORS° and their brokerage must make sure al! buyers, salters,and their REALFORSB cants=m in writing that they ockncwleege, understand,and consent to the situation before .heir of?er is made. P.EAITORS~ typicallyuse what is tailed c ConF;rmaiion of Co-operation and Representation farm todocument this sirootion.

Cofer neccliotions may become stressful, so if you hove any questions whenreference is made to multiple representation or multiple offers, please ask yourRFJ~ITGR~ For on explanation.

CriPieaI (reformation

PEAL?ORS" are obligated to disclose facts Ihaf may affect a buying or sellingdecision. It may be difficult for n REA170R° to judge what Eacts are important.They also may not be in a position to know a fact. You should communicate toyour REALTORe what informofion and facts nbout a properly are imporfart toyou .n making o buying or selling decision, Qnd document Ehis informolion toovoid any misunderstandings and/or unpleasant surprises.

5imi(arly, services tha' are important fie you and are to be performed by thebrokerage, or promises that have been made to you, should be dacument~d inyour contract with the brokerage and its salesperson/brcker.

To ensure the best possible real estate experience, make sure a(I your questionsare answered by your REALTOR°. You should read and understand everycontract before you 6nelize it.

aac6cr~o,rrledgece env ~q:.ADO Canada Limited, in.iEs capacity as court appointed receiver of 2428049 Qntario Inc............... .......................................{Ncme;j

/we have read, understood, and have received a copy of Working with a REALTOR"

Sel3ers: As sellar(s}, I/we understand Ihaf

D.W. Gould Realty Advisors Inc., BroEceraae(oVome of 6rokerage~

( ai~ial-brie)f~j~-::- Is representing my interests, to be documented in a~y''~'`~ ~' ~ separate wriHen agenry representafion agreement, and 1/ (/ ~.~ understand the brokerage may reoreseni and/or provide~~ customer service io other sellers and buyers.

Is ,not representing my in!erests, to be docomen;ed in aSopflrcte wriNen customer service agreement, but wi{I eci

/x 'i~1a toy ~;~icgf cn~preFess~oral manner. ,

' ~.~ r r~Pore} - -- ~Dctel

Buyers: As buyer{sj, i/we understand that

(tVeme of Brokerages(:nil;ol one)

!s representing my interests, .o be documented in aseparate wriHen agency reprasenfotian agreement, andunderstand the brokerage may represent and/or prcvidecus'omer service to ether buyers and sellers.

Is not represenlin5 my interes±s, to be documented in aseparate written customer service ogreament, but will Gctin c fair, ethical and prafessioncl manner.

~Sgrat~ref {Cate)

(SigcoN; e) IDolel I ~S~g~a mrc~ (Da»)Please naFc that Federal legisla5on requires REALTORS to verify the ideality a. sellers and 6v}+ers with whom ffiey tiro wor{cing.Ear ttte purposes aE this infnrmarinn, the term seller" con be interpreted as "landlord' and "b+ryer" can mean ~Mnant' This corm is for informofio~ only and is not a conhvc5.

The hademarks REALTORO. REALTORS(D and tSe REAITCR@ Ic~o me conhalt~ b•y 7}:e Corodi~n P,eoi FsmteAssocfcAon ~CRrAE oral identify real ez!no pre~essionou who are rnemben of CRE4. Used urcor license

D 2016, Ontario Rea) Estclo Assodationt OREA'j. All rig6h raserved 7h~s form wcs dovaioped by GBEA fcr tl~e cse and reprodecnoncf iF, mamben cod licensees onEy Ar. ~tF.er use ar reproducfion .s prohibited v~cept with poor v+r~ren ronseM of OP,EA po rct ~IterwF.en primi:~c cr reproducing the nten~ord preset portion. OREA bocn no 1icb~flty kr you: use of thu ~Crm Form 8 i ~ New 201 J $gage 1 cf @

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QntariuReatEstate ~l~~~~ ~~'~~~~~ _ ~s~ ~~.~~~~Association

~~r~ ~~~~A~~Eeaa~~ ~s~ ~~er ~~~- S~af~

for uu ;n 16o Ftm•ince of Onf~r~o

~i~'€axes is e ~uJtip[e lis2nng Serviced /~greemeaat ~~~ t~

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Initials] {Sellels lnifials)~EFslf/EEE~4:~tto~cE~,,~E:. D. W: Gould Realty Advisors. Inc.,, Brokerage

3105 Uni Drive Unit 33 Mississau a. ............ ...~'........... ~....................................................................._.... ......................_~................_......................... (the "Listing Brokero9`~~

BDO Canada Limited, in its capacity as court-appointed receiver oF2428049 Ontario inc.SERER{SJ :......................................................................................................................................................................... .........{the "Seller")

In consideration of fhe List;ng 5rokeroge fisting the reel properFy $ar sale xnawn as .~5~ 51dTiey St

Belleville QN K8P373 .. .. (Investment . .. ............................................ the "Properly„~She Seller hereby gives the Listing Brokerage the exclusede end irrevacabte right Io ad as .he Seller's agent,

ca~eremencicag at 12:01 a.m. on the . f St ..................... doy of .I1~1!3rCh ....... ..... .., 20. ~. 7...... .. .,

~n'r'aS 1 1 : .9 p.rn. on the .15 .......... ........... day of .FebcU.~~......... ..................................... ....... .. ............., 20. ~, g............. (Ihe "Listing P ion"~,i

.. ~--~..r~J..-..."'

Seller acknowledges that tFe length of the Listing Period is negotiable 6ehween ifie Seller end the Listing Brckeroge and, if an ~ ";._ ~_ ~.sMLS° (isling, may be subject fo minimum requirements oE'he real esrote board, however, in accordonce wish the Real Estete ~~/ ~-<'and Business Brokers Act of Ontario (2002], if Phe Listring ~'ersoc$ exceeds sex months, Hre LisiiRg Bm~erage mus$ {Sellec's.Initials)s~68u~n 49~e ~e@fer's ir~'steals.

to offer the Property for scale at a price of

Three.l~lillion_One Hundred.Thousand ..... ................ .... .... ...... ...... .. ...................... Dollo~5 ($Cdr 3,100;000:00and upon the terms particularly set out herein, or at such aiher price and/or germs acceptable to the Seller. 1t is undersiocd thot the price and/or termsset out herein are a! the Seller's personal request, oFer Full discussion with t»e E sting Brokerage's represenrotive regarding polenliaE market value of ]heProperty.

The Seller hereby represen4s arni wasran4s 9ha8 4Fne Seller is not a ~ar4y to any other fisfing agreement for the Pra¢~er~ mrogreesnenf 40 day cornrc~iss'sore fo any other reef es4ate b~o@cerage for the sale of tFee proper4y.

➢. ~gP{S~SITICtP95 6~l3d~ 8A~4'~RP6tETQ.iBOPrlS: For the purposes of Ihis Listing Agreement ("Authority" or "Agreement"J, "Seller" includes vendor anda "buyer° includes a purchaser or a prospective purchaser. A purchase shall be deemed to include the entering into of any agreement to exchange,or the obtaining of an option to purchase which is subaegvendy exerc;sed, or the causing of o First Right of Refusal to be exe-cised, or nr ogreemertto sell or transfer shares or assets. "Rea[ property" includes real estate as defined in the Real Estate and Business Brokers Act (2002 . The "Property"shall be deened to include any part Thereof or nferest therein. A "real estate board" irdvdes a real estate association. This Agreement shall be roadwith oil changes of gender or number required by tie canlexL For purposes of this AgreemenE, anyone inhoduced to or shown the Property shallFe deemed to include any spouse, heirs, execuhors, administrators, successors, assigns, re(oted corporations and affiliated corporations. Relatedcorporo~ions or affiliated corporations shall include any corporation where one half or a majority of rho shareholders, directors or off+cers of therelated or offiliahed corporation ere the same oersor:(s) as the shareholders, directoa, or omcers of the ccrporalion introduced to or shown theP. operty.

2. ~OM4Fd3155d~[~: !n consideration of the ~isring Brokerage lining the Property for sole, Fne Seiler agrees to pay Ehe Listing Brokerage a commission

toF. ~ .......................... % of the sale price of the Property or Il! 1..-- ....................... ......._................................................_................_............

for any valid o~fer ;o purchase .he Property Erom any source whatsoever obtained dur~na the Lis'ing Period and on the terms and conditions szs out inThis Agreement ~!R such other terms and conditions as the Se(ler may acceph, l

~~ ~~` '€~€id~5 OP L65TifFlG B§~QKERL~GE: ~~ 6S~l4fi0Rk5 4DP S~kl.ER~S}~ ~k,.~~,/ ~~,~ i

Tne nedomarks RFALTOR~, P,EA;TORSI and 1?~e RFAUOR~ logo ma ccnhcElod by Ff~~e Cancdion Beat EsrolorUso;.ioticn ;C2:A) and idenBfy teat e_ia~e pre(essienol; who ore members of CkE4 U.ed under license

6) 201 b, Ontario Rr~l Eslalo Association ('GREAT Ail rghts reserved. Thie form we3 davd~ped by ORFA for the use ord rrrodvc!ior.of ih nembers and lice~nsaes only Ary other use or rep:ocucfian is prohibi!ed except wiifi prior wr~Ner. consort o' CP,Eq Do nos alterwhen prinfing or rc~od~cing i6e amndord prcacl per!icn OREA boars no liaodlly kr your use o(this savor FOCm S2~ Revi3ed 2015 Ptl9e ~ D¢ 4

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The Seller further agrees to poy such commission as calcufaled above iF cn agreemerl to purchase is cgreed to or occepted by the Seller or anyone on

the Seller's bena(f within . ~.8~.........., days after the expirction of Iha listing Per;od (diotdover Pern~~`), so Icng cs such agreement is with anyonewho was introduced fo the Property From any source w~at~oever during the Listing Period or shown the Properly during tFe Listing Aeriod. If, however,the oFFer for the purchase of the Property is pursuonf to c new agreement in writing io pay commissicn la ano}her registered reaf estate brokerage,the Seller's liability for commission sF.all be reduced by the araovnt paid by the Seller under the new agreement.The Sel~A~ further agrees to pay such commission as calculated above even ii the ;ronsaction contemplated by ar agreement to purchase agreed toor accepted by t5e Se11er or anyone on Ina Seller's bena'f is not completed, iF such norrccmpletion is owing or attributable [o the Seller's defautt orneglect, said commission l0 6e payable on the date sct {or completion, of the purchase of the Properly.Any deposit in respect of any oyreerneni where the tronsection has been compiefed shall Krst be oppiied to reduce the commission payable. Shouldsuch amounts paid to the Listing 8rokeraoe from the o'eposit or by the Seller's so?~cifor no! be sukicient, she Seller sha11 be liable to pay io the ListingBrokerage on demand, any deficiency in commission and taxes ov+i~g on such commission,(n the event the buyer tai& to complete the purchase and the deposit or any port thereof becomes forfeited, awarded, directed or released to theSeller, she Seller then authorizes the Listing Brokerage to r<_tain os commission for services rendered, fiky i50%) per cent of the omourt of the saidd=posit forfeited, awarded, directed or re'eosed to the Seller (but no'to exceed the commission payo6le had o safe been consummated} and to paythe balance of the deposit fo the Seller.

AI! amourds set out as commission are to be paid plus apoEicabie lazes on such commission.

3. F~EWR~SEF~767l~&~E: Tho Seller acknowledges that the Listing 8rokeroae has provided the Seller with wriRen information explaining agencyrelationshlps,induding information on Sel4er Representoticr. Sub-agency, Buyer Repr=sentar;on, Multiple Representation and Customer Service. The

Seller authorizes the listing Brokerage to co-operoie with any other regis'ered real estate brokerage (co-operating brokerage}, and to oiler to pay

the co-operating brokerage a commission of .~: ~........... °o of the sole price of the Property cr .??Ja .............................................. ..

out of the cornmissia~ the Seller pays the listing Brokerage. The Seller unders!ands Ihot unless the Setter is otherwise informed, the co-operating

brokerage is representing the interests of the buyer in Phe Transaction. The Seller further acknowledges Thal the Listing 8rokerege may be 13s1ina other

properties .hat may be similar to the Seller's Prcpery sand the Seller hereby consents to the Listino brokerage acting as an agent For more than oae

seller without any claim by the Seller of confiict of interest, Unless othe;wiseagreed in writing behveen Seller and Listing Brokerage, any commission

payable tc any other brokerage shot! be paid out of the commission the Seller pays the Listing Brokerage.

the Seller hereby appoints she Listing Brokerage as the Seller's agent For hhe pureose of giving and receiving notices pursucnt to any offer er

agreement .o purchase the Property.

fdillL3E~LE FdE~RE5E6~FTA~'Cm6+l: The Seller hereby acknowledges that the listing Brokercge may be entering info buyer representa'ion agreemen?s

with buyers who may be interested in purchasing the Seller's Property. In tie evens that she Lissng Brokerage has entered into or enters into a buyerrepresenla,~ion agreement with a prospective buyer for the Sef(er's Property, the !isfino Brokerage will ebto~n the Seller's written consent is represent

both the Seller and the buyer for the transac!ion at hhe earliest practical oppor~unity and in all cases prior to any offer to purchase being svbmltled

or presented.The Seller ~~nderstand and acknowledges that the Listing Brokerage must be ~mparticl when representing both the Seger and the buyer and equally

protect the interests of the Seller and buyer. The Seller understands and acknowledges that when representing both the Seller and the buyer, the Listing

Brokerage shat) have o duy or [v(I disclosure to both the Seller and the buyer, including a reGuiremen~ to disdese a0 Foclua! information about she

Property known to the Listing Brokerage.However, the Seller further understands and acknowledges that the i.~st~ng Brokerage shall ncf disclose:

that the Seller may or wit! accept less Than the listed price, unless otherwise insiruc~ed in writine by the Seller,

lnat .he buyer may or will pay more lf~an the altered price, unless otherwise instr,~cted in writing by the buyer;

~ 3he motivation of or personal informolion about the Seller or buy=_r, unless otherwise instructed in writing by the party to whic`n the information❑pplies or unless Foilu:e to disclose would constPtute Fraudulent, unlaw~ul or unethiml practice;

the price the'~vyer should offer or the price the Seller should accept; andthe Listing $rokerage shall not disclose to the buyer the terms of any other offer.

However, it is understood that factual market information above comparable procerties end ir.Enrmalion known to the Listing Brokerage concerningpatentiol uses for tFe Properly will be disclosed to both Saito r and 6~•yer to ass'isE them to come to their own conclusions.

'mere a IBroPcerage a~epresen3s bo~fs the Seller asac! the buyer (rnu€7ipEe representateen), the ~rmlcercge sha14 nab be enfi:teE&or cuekior¢ed to ~e cagere4 fr~r either ?he lie~rer or fE~e Se11e~ froc EfFe ~O~rgwse o~ yiveng ancE e~eceivae~~ no4icss.

E~!lEJ~.T~P~~ REPbdESEk~`S~~IOE'~f dSEd~ Cl@SFfSt41EFt SEEtV3CE: the Seller undersicnds and ogress Ihat the tilting 8rokerege o;so providesrepresentation and customer service to o'her sellers and buyers. If the Listing Brokerage represents o; provides customer service to more than oreseller or busier Eor the sar-~e trade, the listing Brokerage sEali, in wrilinc, at the earliest oractimble opporsunity and before any oiler is made, informall sellers and buyers of the nature of i'ne Listing Brokerage's relelionship to each seller and buyer. ,~;~

~~'.y ='~ :f//1'-''':

IPdl3PL$ES OF ~E'SSEAIG BROlG~~£sE: ~ €Pd'€T[~Ai~.s 47F S~LL~F~.{SJ ~ ~ /!3,~~

the hcdemarb REALTOR.^-„ REAQOK4~ and Iha ~iEALiOR~ logo ara m~hclfed 6y Tho Coned~on Reat EstateAsaociofion iCREA) cnd idenAy cool estola profassionaln who ere nembe~ of CREA llaed under license

~ 20 f 6, Or,Icrio Real Eiiole As:ociafion( CREA"j. hl) righn reserved. This farm was developed by ORfA for the use and reproductionof In mem6en and liconsees on~ A~ olha use or reproducfion is preni6iled e.<cep~ with pr'or wrtnen consent cf OREA Do not al,wrwhen prmring cr reproriucfng the sronamd p~eoei portion. ORcA brors no liobiliy for ywr use eF rSis form ~o[m 520 Revised 21775 Page 2 of Q

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~3. ~?~F~RRfk~ OE E~f2QlE~6E5: The Seller cgrees thot during the Listing Period, the Seller shalt advise the Cisling Brokerage immedioieiy cf all enquiriesfrom ary source whatsoever, end all offers to purchase su6miHed to the Se(ler shall be immediately subrniHed to the listing Brokerage by the Sellerbefore the Seller accepts or rejects the same. ff any encuiry during the Listing Period results in the Seller's accepting a valid offer tc purchase duringtf~e listing Feriod or wifhin the No!dover Periad esker the expire'ion of the Lis'ing Period described above, the 5e(!er ogrees .o poy the Cistirg Broke: agefhe omount of commission set ovl obove, payoble within Eve (5) days following f6e listing Brokerage's wriBen demand therefor_

S. F~kE€ECE1tIt~G: The Seller agrees ;c allow the Listing Brokerage to show and permit prospective buyers to (vl:`y inspect fhe Properly durirg reasonobieFours and the Sell>r gives the Listing Brokerage the sole gad exclusive right to pace "For Sole" a~n "So!d" sign(sj upon the Froperry. The Seilerconsenh'o the Listing 3rokerage including iaEormotiort in advertising that may identify the Property. The Se':ler further agrees that the Listing 6rokerogeshall fiave sole and exclusive authority to make al( advertising decisions rela~irg to the marketing eF the Property during tE~e Gs~ing 9eriod. The Selleragrees thaP the listing Brokerage wilt not be he?d (table in any manner whatscever for cny acts or omissions with respect to advertising by the listing8rokeroge or any o'her part}; other thar, by the Listing 8reke~age'z gross negligence or wilEi:i act.

Cs. YJLAR~AI~ISY: The Seller represents and warrants that the Seller has the exclusive authority and power to execute this Authority to offer ti,e Property forsale and that the Seller has informed il~e (istirg Brokerage of any third party inleresfs or claims on the Property suc`n as rights of f4rst reF~sal, options,eosemerts, mortgages, encumbrances or otherwise concerning the Properly, which may oFect 'he _~fe of the Property.

7. @3~!€1EfUlN'1FICA.T10iV ~6~5~ 86~35SSB?11P]CE: the Se11er wilt not hold thz listing 8roxerage and representatives of the Brokerage responsible forcry loss or damage to the Property or tonlents occurring during the term of this Agreement caused by the Listing BroKerege or anyone else by anymoons, irn=lvding the", 6re er vandalism, other than by the listing Brokerooe's gross negligence or wilful act. The Seller agrees to indemnify and saveharmless the Listing 3rokerage and representatives of the $rakerage and any caooerafing brckerage From cny Eiabi~iy, claim, toss, cost, damage orinjury, inciud'+ng but rct limited to Loss of the commission payable under this Aareemen~. caused or contributed to by the breach of any warranh~ orrepresentation made by the Soler in this Agreement or the accompanying data form. The Seller egrees to indemnify and seve i~ormless the ListingBrokerage end representatives of the Brokerage and any co-ape*afing brokero~e from any Iicbilily, claim, loss, cost, damage or injury os a result ofthe Property being affec±ed by any coMaminanls or environmertal problems.The Seller warrants the Property is insured, including personal liability insurance Against any claims or lawsuits resulting Erom bodily injury or propertydamage lu others caused in any way on or of the Property and the Seller indemnifies the Brokerage and oIl cE its employees, represenlalives,sa3espersons and brokers Misting E3rokerage~ and any co-operating brokerage and alt of its employees, repre_entaiives, salespersons and brokers(co-operating brokerogej for and against any .loims against the Listing Brokerage or co-operating brokerage mode by anyone who attends or visitsthe Properly.

8. F~f+A~1`d ski/ 6tC'6: The Seller hereby warrants fhot spausol consent is not necessary under the provisions of the Family Low Act, R.5.0. 1990, unlessthe Seller's spouse Eros executed the consent hereina$er provided.

9. FIMD~645 ~~~5: The Seller acknowledges Ihof the Brakeroge may be receiving a finder's fee, rzwerd and/or referral incentive, and Ehe Sellerconsents tc~ any such benefit being received and retained by the Brekeraoe in addition Io the commission os described oboe.

1+D. 1lERB~(~L!'f~CDBV ~P Fi~FQ~AAATl~6V: The Seller au!hcrizes )he Lisping 8rokeroge to ob~ain cny in(armation fro;n any regulatory authorities,governmer.is, mortgagees or others affecting the Property one the Seller agree< ro execute and deliver such Further cuthon.ztifions in this regard osmay be reasonably required. Tne Se[fer hereby appoints the Listing 8rokeroge or the Listing Brokerage's authorized representative as the Seller'saBorney ;o execute such documentation as may be necessary to effect obtaining any infermetion as aEorescid. The 5e11er hereby authorizes, instructsand directs the above noted regulatory authorities, governments, mortgagees or ohhers to release any and all informaticn to the fisting Brokerage.

7 ~. ~JS€ 68R4D €)15T~2EBl97i0~ OF @B~lPO~~IFECEAl: The Seller consents .o the collection, use and disclosure of personal inEormalion by the BrokerageFor the purpose of !fisting cnd mcrketing the Property including, but roI limited ro: listing and advertising the °ropery using any medium including theInfernef; disclosing Propery inFormatior to prospective buyer;, brokerages, salespersons and others who may assist in the sole of the Property; suchother use of the Seller's oersonaf information as is consistent wi~fi fisting and marketing o~ the Property. The Seller consents, i~ Ihis is an MlSd lining,.c pfacemenf cf the listing inFormetion and safes information by .he Brokerage into the dot~bose(s) of the MLS~ System of the opproprio~e Board, andto the posfing of any documents and other informolion {including, without limitation, p~otogrophs, images, graphics, audio and video recordings,virtual tours, drawings, floor plans, architectural designs, or~istic renderings, surveys and listing descriptions} provided by or on behalf of the SelBerinto the dcrobase(s) of the MLSF System of the appropriate Board. The Seller hereby indemnities and :wes harmless the $rokerage and/ar any ofits employees, servants, brokers or sales representatives from any and ol] claims, liabilities, suits, ac'ions, losses, costs and ?egal fees caused by, orarising out af, or resulting from the posting of any documerts or other information including, withovf limitation, photogropFs, images, grcphics, audioand video recordings, virtual tours, drawings, Roor pleas, orchitecfural designs, ertist~c rendering<_, surveys and listing descriptions) as aforesaid.The Seller ccknowledges lnot the database, within the board's ivllS~ System is the property o'r the real esfote board{s~ and can tie licensed, resold, orotherwise dealt with by the boordfsj. The Seller 'urther acknowledges that th=_ real estate board(sj may: during the term of the IisBng oral therea,4er,distribute the iniormatior, in the database, wiEhin the beard's MLSa System to any persons authorized to use such service which may include otherbrokerages, government departments, appreisers, municipcl organizofions and others; market the Properly, o:` ifs option, in ary mec[ium, includingelectronic media; durirg the term of the fisting and thereaker, compile, retain and publish cny statistics including historical data within the board'sMLS"' Sysiein and retain, reproducA and display photographs, images, graphics, audio and video recordings, virtual tours, drawings, floor plans,architectural designs, artistic renderings, surveys and listino descnp;ices which may tie used by oeord members fo conduct comporetive aroiyses; and._;;•make such other use of the inEormotion as the Brokerage and/or ;ea! estate boards) deem app~opriote, in connection with the lisfin~7, m5~~~ur~d' . —:

~`~'~ -r`,~ ~6E~6Y3ALS ~F iISTtBd~ @~OY.ERGSG~: ( ) ES~9~EA~5 mF SECE.tER{5~ ~ ~~,~,✓~ ~~,

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the trodomorks REALTORQ~i, RE4'SORSS and the P,EAGOR~ logo are cortolled b~ The Cancd~an 2eol Esh~tekssocia+ion ,CREA) and idoniify root estate prokss~onol: who arc me:nocz cf CR,A. Used under liceme

c:~ ZOF6, Onbrio Real Estate Aasxioron ('OREA"]. All righh reserved. Tiii! ~crm was devoleped by OkEA for ~F.e ax and reprodocrionof ;h members and licnns.es only Arry Omer uses or reproduction is prohibited except with prior waken content cF OREA Do eel eL•crwhen pnnnng cr reproducing the s:andord pre-set porficn. OR:A bears no liabiliy £or your use ot;hn fc!m Forst 52Q 3evisod 2015 Page 3 of 6

'JVEBForms~ Ded20'f5

sellrna or real estate during the term of the listing and thereokec The Seller acknowledges that the information, personal or otherwise ~"informatio~'7,provided to the real es±ate board or nssaciQtion may be stored on databases located eu!side of Canada, in which case the information would besubject 10 (he laws of the jurisdiction in which the informafien is located. ~j'~

fn the event Ehat this Agreement expires or is corcellad or ctherwise ~` ~ferminote+j and the ?roperiy is not sold, the Seiler, by initialling: ~ `~'

1 ~' ~ i' ~~,}

consent to allow other real estate 6oerd members to concoct hl;e Seiler offer exp~raficn or `~ iaocs) jDo~s;Noc}

afher termination of this Agreement to discuss listing or orherHise marketing the Property.

i2. ~EECEE550R5 ~b lBSSIGl~45: The heirs, executors, administrators, successors and assigns of Ihs undersigned ore bound by the terms of PhisAgraemer~l.

i3. Gfl[~FL1fT t35~ DISCR~~AEdCY: IF there is any conflict or discreponty between any provision added ~o this Agreemerf (including any ScheduleaHached hereto} and any provision in the standard pre-set portion hereof, the adried provision stall supersede fhe standard preset provision to theextent of such conflict or discrepnncy. This Agreement, including any Schedule attached hereto, shall constitute the entire Aofhority from the Seller tothe Brokerage. There is no representation, warranty, coilaterol agreement or condition, which affects this Agreement other than as expressed herein.

B4. ELc~'6FOi~tC CO~d9Ffi1lt'~DICd47tOB~: This Listing AgreQm>nt and any agreements, notices or other communications contempletedthereby may be tronsmiMed 6y means o`r electronic systems, in which case signatures shall be deemed to be original. The transmissionof this Agreement by .he Seller by e(ec;ronic moons s6e11 be deemed to confirm the Seller has retained o true copy of the Agreement.

35. SC}3EC2!ll.~{S~ A .........................................................................._........... and data form attacheri hereto forms} park of this Agreement.

~§-!E 49STlF~EG BF8OKE88t~GE e~~~EES 'F~ RRA~@CEF 'S~1E PROP~R'~ O"i ~~HAlF OF 719E SELf.~&t ASr9b3 REPRESE[~47' THE SE~E6t E3V ~&E~BE~QVOUR TO OBTEI@9V ~, Q/RI.ID ~rFER TO A4lRCF3ASE '6~3E PROPERF~ ~~ TkE~ i"ERFflS SET 06P~ EBd ~~SS ~44~EtEEfs9E6~~ ~Ff ~Pd S~tC~fDT9-6~R TEStM:S S~L315FAC~'~3&t~t Tm 4FEE SELCE~.

.................................................................................. DATE ..................................... Derek Gould{Authorized to bind iho Usting B;okoroge] (Nome c~ Parson Signi^gj

'4I~i~5 AUT€~iOF:i~I HFeS ~cE[~9 Ti'EdaD /~L@dD ~6lFiY 4lt~~~RSTOQD BV ME !9€~~ 1 ACE{l~OVsil.E~GE S!-HtS ~d.'E€ f E~!ld+E 56G9~ED 6J~DE~ [email protected] represeniaiicns ccr,fained horein or as shown on the atcomoonying data Form respecting the Properly ore true to the best of my knowledge,information and belief.

SIGNED, S=ACED ANp DELIVERED I have hereunto set my hand and seal:

BDO Canada, i~irrbiz~ci; in its,~zp~citx.as.court appointed receiver of 2423049 Ontario Inc.

/l J

~SPFnd~'Gre o ~. ~Aufh~nza Si9n1~g 015ceF~ * ~Seol~ ~ ~1'e hto.T

.................................................................................... DATE .................................... ...._......_......................................................(Signmure cI Seile•/Authorized Signing Of~iter) j~eal)

~~04.lSAC COl~fSEPdE: The undersigned spouse of the Seller hereby consents to the listing of the AroperFy F~erein pursuant to the provisions of the Family

!aw Act, Q.S.O. 1990 and hereby agrees that he/she will execute all necessary or incidenicl documents to fvriner any transaction provided (or herein.

..................................... ........................~--.................... DATE .................................... ...........- .................................................~Spovse~ (Beall

DECL165t6~3BOF~1 OF Et~53~EFLe9~LE

'he broker/sc:lesperscn Det'ek GOuICINam¢ of Broker/Solespe;sent

hereby declares f6at he/she is insured os required by the Real ~s!ate and Business Brokers Act tRE6BAJ and Regulations.

(Signol;re{s~ of Broker/Salesperson)

/--~~ dCK~l~YdLEDfaEAREB~~

Ths ~Ilef(s) h~teby ecl~ecowle~ga trhae 4he S$fler~s) ~vlly unders4and ~~xe germs a~ t4~is ggeesmenF and hove receivecE a erue cm~sy oS

fEtes !k~ye~i te~f~ the : ~? I ~ 7 . day o4 . ~ %~ ~c .. .......................... . 2€D ~ ~............ .........~ ~! -- ~ ,-i ~ f

.. ..

'?" ~ ~ ~t . ~ ~ ~ .~'i ` / ~..: s ., _.. . .___. .. .......... ....... . ........ ... ..... .. .. ~t,data~~ .. r_, ~ _. <__ ~ ~,.,

................................................................................................................................... Date:(Signature of Se!ler

The Modemar%s REAUORO, REAlTCRS'f9 oral ti+a REAt70R81ogo are controlled by Th» Ccnadion RerJ &tieAssociafior. (CnÊA) and idonhy reef estate professionals who are members of CREfi, Usc under license.

C 20F 6, On!orio Roc( Eotatc Aucciation f"O°EA"t NI rghh reserved this form was developed by OREq ~r the use and reproductior:of ih members oral licnnzees only. A.~y other vee or reprodv:riort is prohibited ~capi with prior wntten consent c( OREA uo nc! aL'erwhen prinlirtg or reproducir~ the ~landorc pre-set porfion. OREh birori co liability hr year vsa of Ibis form Form S24 Rev'~so~ 2G I J 3'~O.g~C 4 0~ ~a

UVEBFarms~ Ded2015

~ Sc~~cfuie ~~''~'~ i~ ~ist9n A ree~en~ — ~~r~~ercia[?~~csafion

Commordal DlrtstortTc~aniG Real Efiat[ Oon~A

This Schedule is attached to and forms part of the Listing Agreement between:

BRQKERAG~,.,...._........D. W. Gould RealtyAdvisors fnc., Brokerage ................................................................. and

S~LLEf~{S;I,..._BDO Canada Limited, in iEs capacity as court appointed receiver of 2428049 Ontario Inc ...................

for the properfy known as:.........250 Sidney St, Belleville ON, K8P 3Z3 (Investment) .........................................

i. ADVICE

The Parties to this Agreement acknowledge that D. W. Gould Realty Advisors inc., Brokerage, hasrecommended that any legal, zoning development charge, environmental, engineering, construction ar taxadvice sought be obtained through their own specialized counsel. The Parties further acknowledge ghat noinformation provided by D. W_ Gould Realty Advisors inc., brokerage is to be construed as expert legal,zoning, de~~eloprr~ent charge, environmental, engineering, construction, ar tax advice. The Selleracknowledges that D. W. Gould Realty Advisors Inc.. Brokerage has recommended that conditionalclauses regarding the obtaining of such advice be included in any agreement to lease or purchase.

2. D/~Ti A V~R(:FIC/~~10~J

The Se(!er hereby acknowledges that any Agreement to Lease or PurcF~ase to be executed will beexecu#ed by the Seiler based in part on information which has been made publicly available through theToronto Real Estate Board's Multiple Listing Service, o#her Rea( Estate hoard`s Mul#ip(e Listing Services,Landlord's, Developer's, or other Rea! Estate Broker's marketing materials or electronic marketingprograms, and from oti~er information sources, which infarrnation may not be completely accurate orreliable.

The Seller hereby acknowledges that it has taken or will take such steps as are necessary and appropriateto investigate and verify the accuracy and reliabiiii}+ of information provided through the above listedsources, and from all other sources, upon which the Seller may intend to rely in completing transactian(s).

3. LEASE & E(~i1lIRONMENTAL DOCUMENTS

The Seller understands and acknowledges that the handling of any Leases, Environmental Reports, orother "deliveries" or due diligence documents by D. W. Gould Realty Advisors Inc., Brokerage is clone as amatter of courtesy to the parties ONLY, and D. W. Gould Realty Advisors lnc. is not responsible forreading, altering {marking-up), or advising in any way in regards to any such documents. Matters regardingany lease, environmental, or other "deliveries" or due diligence documents are the responsibilities of thelawyers and/or other consultants hired by the Seller. The Seller agrees that na claims will be made againstD. W. Gould Realtor Advisors Inc. regarding any leases, environmentals, "deliveries" or other due diligencedocuments.

This fom must be initialec' by elf parties tc the testing Agreement_ + ~i'.> ~K;^

INfTiALS OF BFiOKERAGEc fNtTIALS OF SEL~ERS(S); ~ ~

J Ontario Real Estate Associaf~on ("OREA'~. All fights ressrvecf. This form was developed by OAEA for the use and reproduction of its members and licenseesy other use or reproduction is prohibited except with prior v✓ritten consent of OREA. Do not altar when printing or reproducing the standard pre-set portion.

~~~~ ears no liability for your use of this form.Form 523

W EBForms~JJeG2015

'~ CJnsc~ri~ ~C~l~~~~~

~ ~~! ~~~ l~istinc~ Agreer~secz~ — Cmrr~r~erciaFe$~~xiea8;~n

Commorcf~l ~H(alonTo tonic Reel E~h~+ 6>eed

4. S~'AlVQ~lR~ FORIVPS

The Seller acknowledges that D. W. Gould Realty Advisors lnc. has advised that all agreements arepreferred t~ be completed using OREA standard forms (including a Confirmation of Co-operation andRepresentation} in order to comply with provincial and real estate act laws, regulations and codes o~ ethics,and as part of best business practices. Should any Landford/Seller/Buyer/Tenant refuse to use thestandard AREA fortes and a LandlordlSe(lerlBuyer/'E"enant preferred form is substituted, the Seller agreesfhat no claim will be made against any Brokerage or Salesperson as a result of the use of said fior~n ofdocument a:nd content.

5. VALUE A,SS~SSMEN'6''

The Seller acknowledges #hat the Province of Ontario has implemented current value assessment andproperties may be re-assessed on an annual basis. ft is further acknowledged that the existing propertytaxes advertised andlor in place may reflect a vacant allowance, tax capping, a use tha# attracts anabnormally low or high tax rate, valuation based on past lease income, valuation based on an incompleteMPAC inveintory of improvements built, and/or that the advertEsed tax rate may be an estimate or a halfyear rate. The Seller agrees that no claim wi!! be made against the Brokerage or Salesperson, for anydi#ferences be#ween advertised and actual taxes, andlor changes in property tax and/or developmentcharges as .a result of the Buyer's use and/or a re-assessment ofi the property.

~. PERMlSSIQ~d TO AQVERTISE

The 5elier agrees that general information (i.e. property address, property size, photograph) regarding anytransaction completed may be used in future marketing materials by the D. W. Gould Realty Advisors [nc.personnel involved in the transaction.

7. DEPC3SI~'

The Se!!er acknowledges that D. W. Gould Realty Advisors Inc. has recommended that any depasi# relafingto a ~ransac~ti~n be held in the trust account of D. W. Gould Realty Advisors Inc., Brokerage, or in the trustaccount of an insured Realtor {i.e. a listing brokerage involved in the transaction). The Seller furtheracknowledges fihat there are limits on amounts of trust deposit insurance and that amounts over $100,OOdmay not be covered by the real estate industry's standard insurance.

Notwithstanding the foregoing, it is understood and agreed by the Seller that the commissions in thistransaction, plus applicable taxes thereon, maybe deducted from the Qeposit monies by the Listing ~rQkerupon closing or upon payment of commissions becoming due and payable as per the listing agreement andirrevocably instructs the lawyer to do so if/when a deposit is Feld by fhe lawyer.

8. Ftt~T~tAC

The Seller consents to provide to Q.W. Gould Realty Advisors the information required under the applicableFINTRAC legislation (personal i.d. mus# be done in person) at the earliest prac#ical opportunity, but in noevent later tF;an completion of the subject #ransaction.

This form must be initialed'. by atl parties fo the !SSFing Agreement. ..

IN[TtAL5 OF BROKERAGE: INIFIAl.S OF SE~LERS(S): ~ L~''

--

~ Ontario Real Estate Association ("OREA"). A!I rights reserved. This form rras develcped by OREA for the use and repreducGort of its members ono ~iconseesy other use or reproduction is prohbited except with prior written consent of OREA. Do rot a[ier when printing or reproducing the standard pro-set portion.

R=~,o~' ears no liability for your use ofi this form.Form 523

t'VEEForms¢~eG2015

~che~lule A~~,~~°~~ Listing ,4greerraea~t — Corv~mercia!~.ssccitsPioz

Commerclat Dlr[sionToren[e R~U Eei:~c Bcaro

S. ~EltLDtAtC DOC~IfllfENTA~'t0~

The Seller hereby states that they have delivered or wil! deliver immediately following execution to D.W.Gould Realty Advisors fnc. copies of all municipal, provincial, environmental, conservation authority,ministry of transportation, notices of all types, orders to comply of ail types, and all others relevantcommunication that are in their possession. These documents shall include but not limited to open oroufstanding buildEng permits ac inspection notices, hofcf back notices, incomplete site plan agreementcommunication, dire department notices, sewage system inspections, well tests, sprinkler tests, and stormwater management def+ciencies that are in their possession or have been delivered to them during theirtime of ownership or possession of the building/property.

1 C!. ~AYEUiE~dT OF C~MNBISSI(~t~t~SALE}

In regards i:o this listing agreement the following terms are applicable:

The commissions payable upon closing of this transac#ion shall be calculated such thaB in no evenf shallthe commissions be less than seventy-five thousand ($75,000) dollars, except if the final sale price is lessthan seventy-five thousand ($75,000) dollars in which case the commissions shall be calculated as thelesser of seventy-five thousand ($75,000) dollars or the purchase price at the time of completion of theAgreement of Purchase and Sale. For clarity, the commissions cannot exceed the sale price of theproperty at the time of completion of the Agreesment of Purchase and Sale.

1 ~. BRO&CERA~GE ARRAiVGEME~VIf'S

!t is understood and agreed that the Lis#ing Brokerage may at its option engage a local co-broker GerryBaker from FiE/MAX QUlNTE LTD, Brokerage 3o assist with the listing showings.

~ 2. ACCEPi'/~PlC~ C)~ OFFERS

The Seller, at its sole option and discretion, is under na obligation to accept an offer which does not meetifs obligations un~+er its mandate as court-appo€nted receiver.

~3. SE~LE~f Ct3N~ITl~F~A~. PERIODIt is unders~:ood and agreed that a!I anci any offers accepted by the SeEler are to be conditional on theapproval of the Ontario Superior Court of Jus#ice.

Ttis form must be irifialed by a!f parties to tha Lisfing Agreement i ~'~ i

It~lT1ALS QF BROKERAGEc 1NITtALS OF SELLERS(S):: _`—~~-/~:` 1

~ Ontario Reai Estate Association ("OREA"). All rghts reserved. This forrn vras developed by OFIEA for the use and reproduction of its members and licenseesy other use or reprwJuction is prohibited except ovth prior written consent of OREA. Do rot after arhen printing or reproducing the standard pre-set portion.

~k~oa ears no liability for your use of this form.Form 523

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to

Date: July 17, 2017

fur Ref. #: LW-01170014

Attention: Gary Cerrato

BDO Canada Limited, In it's capacity

as court appointed receiver of

2428049 Ontario Inc.

123 Front St West, Suite 1100

Toronto ON, MSJ 2M2

Copy to Sidney Street Properties Corp.

c/o Bernie Ouellet &Ian Brady

Our HST Number: 813926243 RTOOQI

Property Type: Industrial

Property Address: 250 Sidney St

Bellev'slle ON, K8P 3Z3

Size: +/-33.4 Acres+/-303,840 Square Feet

Sale to: Toronto Capital Corp.

DESCRIPTION Amount

Sale amount of $2,500,OQ0.00 at a contractualS 125,000.00

commission of 5%

Less listing side discount — "warranty work" asDiscount: $ - 62,500.00

property was sold recently (deal default)

Selling Side payable (payable in listing side warrantySubtotal: $ 62,500.00

situations)

Less additional courtesyJhardship discount forpiscount: $ 32,500.00

regular client-

iTotal: $ 30,000.00

HST ~a 13.00 % Taxes: $ 3,900.00

Total Billable: $ 33,90Q.00

Notwithstanding Schedule A, Clause 10 of the Listing Agreement Executed February 27, 2017 —

Discounts applied as above.-~~-

Agreed this ~~ day of July, 2017.

Derek Gould

(Authorized Original Signature)

D. W. Gould Realty Advisors Inc., Brokerage3105 Unity Drive, Unit 33

Mississauga, Ontario lSl4L3Tel: 905-828-2000www.dwgra.com

PAYMENTS Amount

Description:

Deposit held by: D.W. Gould Realty

Trust-Deposit Advisors Inc., Brokerage (Trust

Account)

Deductions Deduct commission from Deposit held

Total ln Trust:

$ X2,000.00

$ 72,000.00

$ - 33,900.00

SUMMARY

~ Payable by BDO Canada Limited, !n it's capacity as court

DWGRA: appointed receiver of 2428049 Ontario Inc. $ 38,100.00

Terms: Due upon successful closing

Please sign below authorizing: the commissions as per the Listing Agreement executed February 27,

2017; and the deduction of commissions from the amounts an deposit.

Agreed this day of 1uly, 2017.

Gary Cerrato

{Authorized Original Signature)

D. W. Gould Realty Advisors Inc., Brokerage

3105 Unity Qrive, Unit 33

Mississauga, Ontario L5L 4l3

Tel: 905-828-2000

www.dwgra.com

to

July 19, ?017

VIA EMAIL: GCERRATO a,BDO.CA

BDO Canada Limited123 Front Street West, Suite 1100Toronto, ON MSJ 2M2

Attention: Gary Cez~~ato , CIRP, LIT

Dear Sir:

Fogler, Rubinoff LLPLawye~~s

?? Y::r':g Street Nest.Suite 3~OC, PO Bcx 95

TC% nrtr e f orth TO~.~~er

Toron*~, ON M5K I G8t: 41 u.864. ~ 7~0 ~ f: ~ (b.941.8852

og~ers.com

Reply To: Vern VW. DaneDirect Dial: 416.941.8842E-mail: vdare(c ~foglers.comOur File No. 166407

Re: Sidney Street Properties Corp. ("Sidney") -Vendor Talce-Back Charge granted by2428049 Ontario Inc. ("242") in favour of Sidney as secured against the real p►-opertylegally described as PIN 40457-0153 (LT) and 40457 -0148 (LT), municipally known as 250Sidney Street, Belleville, Ontario (the "Property") and appointment of BDO CanadaLimited ("BDO") as Court-Appointed Receiver (the "Receiver") of the Property of 242pursuant to tl~e Receivership Order dated December 13, 2016 (the "Receivership Order") .

You have requested our opinion regarding the validity and enforceability of theCharge/Mortgage, in relation to the Receiver, registered on title to the Property on October 15,2014, as granted by 242 in favour' of Sidney, in the principal amount of $2,170,000 (tl~e"Mortgage"). We lave not reviewed any other documents that may have been executed inconnection with the Mortgage.

We have neither received, nor reviewed, the originals of the Mortgage cloclimentation.

A. Standard Assumptions and Qualifications

In rendering our opinion in this letter, we have made certain assulnptioil and qualifications. Theopinions and conclusions expressed in this letter ai-e based an, and subject to, the assumptionsanti qualifications set out throughout this letter, and, specifically, in Sc}~edule "A" to this letter(collectively, the "Assumptions and Qualifications").

B. Laws Addressed

f~~~~~ Pabe 2 of 3

As more particularly set out in the Assumptions ~nci Qualifications, this letter is limited to

matters of Ontario law and the federal laws of C~nacla applicable therein. We express no opinion

with respect to the validity and enforceability of the Mortgage to the extent that such validity and

enforceability is governed by the laws of any other jurisdiction.

C. Mortgage

The Mortgage was registered on title to the Property on October 15, ?014 in the principal amount

of ?,170,000.

Subject to the Assumptions and Qualifications, the Mortgage constitutes a valid charge on the

ProperCy, enforceable in accordance with its terms.

D. Searches

1. Corporate Profile Search

We conducted a corporate profile search in the Province of Ontario at the Ontario Ministry of

Govenlment Sezvices (the "Ministry") with respect to 242, and as of September 15, 2016, tl~e

search showed, ainon~ other things, that Karl Hollett was the President, Secretary and Director

of 242, and that 242 is an Ontario incorporated cou~pany with its registered and mailinb address

at 904 County Rd. 11, Napanee, K7R 3L2.

2. Real Property Searches

We have conducted a real property parcel register subsearch or Land Titles Search against title to

the Property. Our review is based upon and we rely solely upon the Land Titles Search. We

have not conducted a full title search and we have made no other searches, investigations or

inquiries with respect to the opinions expressed herein, including, without limitation, any

inquiries as to access, and inquiries of authorities regarding realty taxes, provincial I nd taxes,

building and zoning compliance, utilities, private or public right of ways, unregistered

easements, conservation or- environmental matters.

We have not examined any surveys of t11e Property for the purposes of this opinion end have not

reviewed any of the encumbrances outstandil~g against the Property other than the Mortgage.

The Land Titles Search lists only one charge, namely the Mortgage in favour of Sidney. In

addition, the Ontario Minishy of the Environment has registered a Cel-titicate on title to the

Property pursuant to the Environnzerztal Protection Act. The Certificate was registered on title on

September 19, 2011, before the Mortbage was registered on title. Finally, the search also shows

that after the Mortgage was re;istered nn title, a construction lien was registet-ed on title on

August 5, 2015 in the amotult of $100,491 ii1 favour of Haniilton Smith Limited and a Certificate

of action i-ebarding the construction lien rebistei-ed on title on September 22, ?015; ai7d a notice

of lease between 242 end Avaya Canada Corp. registered on title on September 1, ?016.

3. Executions Search

~(~~5~~~'" z Page 3 of 3

We conducted an executions search against 242, as of today, in tl~e locality or Sheriff of the Cityof Toronto, Napanee and Belleville anti two executions or judgments against 242 a~pearecl asfollows ill favour of: Hamilton Smith Limited in the approximate of $110,000 issued in July,?016 and Sysco Canada, Inc. in the approximate anzount of $1,200 issued in November, ?016.

E. Opinion

Subject to the Assumptions anti Qualifications, the Mortgage appears to be valid and enforceableagainst 24? in accordance with its respective terms. The Mortgage was also pt-operly rebisteredagainst title to the Property. We express no opinion regarding the ranking or pl-iority of theMortgage or charge in relation to the above executions, constructio~l lien and any claims by HerMajesty the Queen to a deemed trust and/or a statutory lien under the provisions of the Ir~co~neTrtx Act (Canada) for any amounts of employee source deductions not remitted by 242, andsimilar federal oz' provincial deemed trusts and/oz' statutory liens includinb any GST/HST claimsand environmental claims by the government.

If you have any questions, please clo not hesitate to contact the undersigned.

Yours truly,

FOGLER, RUBINOFF LLP

V~.t. W. l?-~.RQ(Computer-generated signature)

Vei~i W. Dane

SCHEDULE "A" —ASSUMPTIONS AND QUALIFICATIONS

ASSUMPTIONS

We have assumed:

the genuineness of all signatures, the identity and the necessary legal capacity at all times

of all individuals, the authenticity of all documents and instruments submitted to us as

oribinals, the confoi~niry to originals and completeness of all documents anti instruments

submitted to us ~s photocopies thereof to the originals, the authenticity of the original to

such photocopies, that the Mortbage or/and each of the Loai1 and Security Documents (the

"Loan and Security Documents"), including any dated as of a particular date; were

executed on the date appearing on each such document and that none of such documents

have been amended, restated or supplemented and that all relevant individuals hacl full legal

capacity at all relevant tinZes.

2. Subject to the review of documents we have received as described in this letter, that

2428049 Ontario Inc. ("242" or the "Debtor") was duly incorporated and was validly

subsisting at the time the Loan and Security Documents were executed by them and that

the Debtor continues to be validly subsisting as of the date of this opinion.

3. that at the time of the execution of the Loan and Security Documents, the Debtor had the

requisite power, clpacity and authority to enter into, execute, deliver and perfor~rn each of

their rights and obligations under each of the Loan and Security Documents and that each

of the Loan and Security Documents was duly authorized, executed and delivered by the

Debtor and that no provision of the articles of incorporation, charter documents or otherdocuments by which the Debtor was incorporated or continued or- any by-laws or anyunanimous shareholders agreement was violated Uy the execution, delivery or performanceof any of the Loan and Security Docuil~ents by the Debtor.

4. that the Loan and Secui-iry Documents are governed by the laws of the Province of Ontarioend that where the choice of law of a Loan and Security Document is the Province ofOntario, it will be given effect to in any legal proceeding, and that the principal place ofbusiness for' the Debtor was, at all material times, Ontario.

5. that the validity and enforceability of the obligations purporting to be secured by each ofthe Loan and Security Documents, that valid consideration his been given by Sidney StreetProperties Corp. (°Sidney") to t}Ie Debtor in respect of which tl~e security was granted, thatthe obligations secured have riot been repaid, or complied with, and remain outstandinb,and t11at all conditions precedent contained in each of the Loan and Security Documents,including conditions precedent to enforcement, if any, were saCisfied or waived.

6. that except as specifically set out in this letter, there are no agreements f~icts orunderstandings, written or oral, (such as duress, nlistal<e of fact, undue influence,unconscionability, oppressive conduct, misrepresentations or bad faith) oi- usage of tradeor course of prior- dealings between the parties affecting or concerning any of t11e Loan andSecurity Documents or the various principal obligations in respect of which the Loan andSecurity Documents were granted t11at were not apparent from our review of the Loan andSecurity Documents and that would or might affect the execution and delivery, validity,

-~-

lebality, binding effect or enforceability of any of the Loan and Security Documents, atlaw or in equity, or that would or alight discharge, release, subordinate, sun-enclei- or assignany security interest granted to Sidney oz- have provisions that are inconsistent with theprovisions of the Loan and Security Documents.

7. that the identity and capacity of all individuals acting or purporting to act as public officials,the accuracy and completeness of the records maintained by offices of public record andof all representations, state117ents and other matters of fact set out or referred to in suchsearches and docu~llents, the reliability of all search results obtained by electronictransmissioi7, the accuracy of the results of any printed or computer search of offices ofpublic record and that the applicable dings, registrations or recordings refei-~-ed to in thesearches conducted relate to the Loan and Security Documents and continue to be effectiveand unchanged as of the date of this letter.

8. that the conduct of the parties to the Loan and Security Documents has complied with anyrequirement of good faith, fair dealing and conscionability, and that Sidney, and any agentactinb for Sidney, in connection with the Loan and Security Documents, have acted in goodfaith and without notice of any defence against the enforcement of any rights created by,or adverse claim to, any property or security interest transferred, or created, as pert of; theLoan and Security Documents.

9. that the Debtor was not insolvent, unable to pay their debts in full or nn the eve ofinsolvency at the time the security interests were granted pursuant to the Login and SecurityDocuments and the Debtor was not rendered insolvent by the grant of such securityinterests.

10. that the Debtor has no legal defence against any applicable creditor(s), for, withoutlimitation, absence of legal capacity, fraud, misrepresentation, undue influence or duress.

1 1. Except as specifically set out in this letter, we have not undertaken any independentinvestigation to verify the cot7~ectness of any of the foregoing assumptions.

QUALIFIC~ITIONS

The enforceability of the Loan and Security Documents and the rights and remedies set outtherein or any judgment arising out of oz' in connection therewith may be limited by anyapplicable banla-uptcy, insolvency, windinb-up, reorganization, arr~nbement, moratorium,fraudulent preference, fraudulent conveyance, oppression or other laws affecting creditors'rights generally. We express no opinion as to whether the Loan and Security Documentscould be attacked antler any such legislation or in any manner, including:

a. the costs of and incidental to a proceeding to enforce a Loan Ind Security Documentare in the discretion of a court of competent jurisdiction, and suc11 court maydetermine by whom and to what extent the costs shill be paid,

b. section 347 of the Criminal Code (Canada) prohibits tl~e payment of "interest" at a"criini11a1 rate" (as such ternZs are defined therein);

-3-

c. except as specifically discussed herein, any action on any Loan and SecurityDocument may be barred by the Limitations Act (Ontario) after the applicablelimitation period ]Ias expired; and

d. a judgment by the Court for the payment of an amount of money may only beawarded in Canadian currency aild maybe based oii a rate of exchange in existenceon a date other than the date of payment.

2. We express no opinion regarding the enforceability of any provision of the Loan andSecurity Documents which purports to provide that any portion thereof whic}1 isunenforceable may be severed without affecting the enforceability of the remaining

provisions.

3. We express no opinion as to the lebal or beneficial right, title or interest of the Debtor or

any other person to any of the Property, personal property, lease of personal property or

any of the collateral subject to any of the Loin and Security Documents and such title has

been assumed to the full extent necessary to express the opinions herein contained.

4. We express no opinion as to the ranking or priority of any security interest, lien, hypothec

or' security interest expressed to be created by or under the Loan and Security Documents,except as set out explicitly in this letter and only to the extent that any such security interesthas been registered under the PPSA, or is subject to any Orders granted in the Proceeding.We note that the order or registration of a security interest under the PPSA is not absolutelyindicative of priority, including, but not limited to, the cases of investment property,

purchase money security interests, interests not govenled by or subject to the PPSA andunrebistered bovermnent claims.

5. We express no opinion regarding the creation, validity, enforceability or perfection of arlysecurity interest, lien, hypothec or' other- interest in, or the enforceability of, the Loan andSecurity Documents insofar as it relates to any:

a. 1-eal property (other than expressly referenced in this letter and only to that extent),fixtures, claims or rights, or a lease of reel property, or any interest in real propertyor right to payment that arises in connection with ail interest in land;

b. policy of insurance or contract of annuity;

e. trade-mark, copyribht, inciustri~l design, patent, patent application, licence,approval, privilege, quota, franchise, permit or any other intellectual property,rebulatory authorizations or other similar property which is not personal or movableproperty;

d. consumer goods (as such item is defined in the PPSA);

e. interest ii1 a right to damabes in tort or at law;

is debt owinb to the Debtor by the Crown or any abent thereof; and

-4-

g. any property which is an interest in an unearned right to payment under a contractto a transferee w110 is to perform the transferor's obligationsunder the contract.

6. We express no opinion as to the enforceability of any provisions of the Loan and SecurityDocuments, which:

a. purport to directly or indirectly exclude unwritten variations, waivers or consentsof~, to or under the Loan and Security Documents or' restrict their effect;

b. provide for agreement at a later date;

c. ptu~ort to restrict the access to, waive or purport to waive the benefit oz' protectionof any lebal or equitable- rights, reuledies or defences, or principle of statutoryprotection based on public policy, including any rights to notices, including noticesof enforcement;

d. provide for obligations, rights or remedies which are inconsistent with any other

provisions of the Loan and Security Documents or subject or suborcli~late to, or

ovet~-idden by, other provisions in the Loan and Security Documents;

e. provide for evidentiary standards as being conclusive and binding;

f. purport to bind or affect, or confer a benefit upon, persons who are not parties tothe Loan and Security Documents;

g. purport to establish evidentiary standards, such as provisions stating that pertaindeterminations, calculations, requests or certificates will be conclusive or- binding;or

h. appoint or constitute any personas attorney for the Debtor to execute any document

or- do any other act on behalf of the Debtor,

7. Each of the Loan and Security Docuillents may be subject to:

a. the powers of a court to stay proceedings and execution of judgments,

b. applicable laws regardinb limitation of actions;

c. tl~e dowers of a court to exercise its discretion to decline to hear' any action or giveeffect to any obligation if to do so would be contrary to public policy; and

d. implied obligations of hood faith, fair dealing and reasonableness in theperfoin~ance of a contract.

Provisions providing for the recovery of fees and expenses clay be r-estrieted by a Court toa reasonable amount and counsel fees may be subject to taxation.

No opinioli is expressed concerning the applicability of any equitable remedy, norconcerning equitable limitations on, and defences against, the availability of remedies andequitable principles of application to proceedings at law or- in equity.

-5-

10. No opinion is expressed as to the creation, validity, enforceability, attachment or perfection

of any n7ortbage, charge, hypothec, security interest or other interests expressed to be

created by or under any of the Loan and Security Documents with respect to any property

of the Debtor oz' any proceeds of such property that are not identifiable or traceable.

1 1. No opinion is expressed as to the maintenance of the perfection of any security interest

created by any of the Loan and Security Documents.

12. Any security interest expressed to be created under any of the Loan and Security

Documents in any collateral acquired by the Debtor after the execution and delivery of the

relevant Loan and Security Document will not attach to such collateral (and will not be

enforceable abainst third parties or perfected) until t1~e Debtor acquires rights in such

collateral.

13. T17e views expressed in this opinion, unless set out explicitly in this letter, do not address

laws of jurisdictions other than the Province of Ontario or with respect to p1-opei-ty for

which, pursuant to applicable conflicts rules the validity, perfection and effect of perfection

or non-perfection or enforcement are governed by the I~ws of a jurisdiction other than

Ontario.

14. Any views expressed with respect to the security held by Sidney are based solely upon a

review of the informarion provided to us by the Ministry and the specific documentation

descried in this letter. We express i10 opinion with respect to:

a. any subordination or postponement agreements not specifically dealt with in this

letter and specifically in the sections dealing with the validity and enforceability of

any such subordination agreements;

U. any um~egistered or unperfected claims of third parties whether now existing orarising in the future, inchiding legislative super-priority claims, liens, charges ortrusts, which may, in the absence of any registration or other means of perfection,rank in priority to, or take precedence over, the security interests of Sidney.

15. With respect to the charges created under the Loan and Security Documents, acceleration,enforcen7ent and realization under the Loan and Security Documents may be limited orconditioned by statutory conditions contained in the Bankruptcy and Insolvency, R.S.C.1985 c, B-3, as. am. and other applicable le~islatioiz.

16. A receiver or receiver and manaber appointed pursuant to any Loan and Security Documentmay, for certain purposes, be treated by the Cou1-t as being the agent of Sidney and notsolely the agent of the Debtor (and Sidney may not be deemed to be acting as the agent oi-attoi-tley of the Debtor in making such appointment), notwithsta~7dinb any provision in anyof the Loan and Security Documents to the contrary.

1 7. We express no opinion with respect to provisioi7s in any Loan and Security Document tothe effect that Sidney is not responsible to t}Ie Debtor for' its own misconduct or negligence,or- the misconduct or nebligence of any agent, receiver or receiver and manages- appointedby Sidney, including any provisions that purport to waive compliance by Sidney withlimitation periods iil7posed by any statLite, 01- generally nt law.

-6-

18. The effectiveness of provisions of any Loan and Security Document which pur~~orts to

relieve a person from a liability or' duty otherwise owed may be liinitecl by law, and

provisions requiring indemnification or reimburseu~ent inay not be enforced by the Coui-t

to the extent they relate to the failure of such person to have performed such duty or

liability.

19. No opinion is expressed in this opinion letter as to whether it inay be necessazy in

comlection with the enforcement of any Loan and Security Document for Sidney oz- any

other persons proposing to acquire, own or operate all or airy part of the property secured

thereunder, to give any notice or obtain or effect any licence, franchise, permit, consent,

approval, registration or other authorization or exeiliption in connection therewith.

20. We lave not conducted any searches in respect of any trade-marks, trade flames, industrial

designs, patents, copyrights or other intellectual property interests and no opinion is

ex~resseci with respect to the validity or effectiveness of the security intel-ests of Sidney

with respect to these interests.

21. A security interest in, or charge over:

a. a trade mark, copyright, industrial design, patent, patent application, license, or

b. any goods purchased under ~iy licence;

c. an approval, privilege, quota, franchise, permit or lease; and

d. an instrument, contract, account, receivable or agreement.

may not be perfected, valid, binding or enforceable because of the nature or teens of such

property or ~~reement, or to the extent the nature or ternls of such property or abreement

or any statute or regulation require a consent, approval, acknowledgement, notice or other

authorization or registration, as a condition of assignability, which has not been given or

made.

22. Our opinions do nor address any of the following matters:

a. any required registration, filing, recording or notice in respect of any fixrin~es, or

goods that may become fixtures; and

U. any required registration, filing, recording or notice ii1 respect of any real property

rights or interests of any of the Loan and Security Documents, except as specifically

provided for in this letter, and subject to the Assumptions and Qualifications.

23. We express i10 opinion on the priority or ranking of any real property charges vis-a vis,

inter- aria, any liens under the Constnlction Lien Act (Ontario) (the '`CLE1'') to the extent of

deficiency in the holdbacks required to be made under the CLA, or to the extent provided

by section 78(3) of the CLA, airy liens for taxes, rates, assessments, or govein~nental or

public utility charges or leviEs not yet due alld payable, and any unregistered lease, interest,

claim oi- encumbrance of which the addressee of this letter has actu~~l notice. We express

-~-

no opinion as to whether the Mortgabe or any mortgage in this matter constihzte as a

"Builclinb Mortgage'' as defined in the CLA.

24. With respect to the charges created under the Mortgage against any of the Property:

realization under the Mortgage inay be limited orconditioned by statutory

conditions contained in the Mortgages Act (Ontario) or the Planning Act (Ontario);

b. any interest in the Property registered before the Mortgage may rank in priority to

the Mortbage;

c. other interests in the Property registered subsequent ro the Mortgabe may rank in

priority to the Mortgage; and

d. enforcement and realization of the Mortgage may also be lin~itecl or conclitioneci by

any:

unregistered liens, charges, adverse claims, security interests orother

encumbrances of any nature claimed or held by Her Majesty the Queen in

Right of Canada or Ontario, or by any governmental ministry, department,

agency, municipality or authority under or' pursuant to any applicable

legislation, statute, or regulation;

ii. mechanics, construction, laborers, vendors, materials, oz' othez- similar liens

arising in the ordinary course of business and out of the construction or

improvement of real property or out of the furnishing of materials or

supplies therefor, a claim for which shall not have been registered against

such property or which notice in writing shall not at the time have been

given;

iii. undetermined or inchoate liens arising or potentially arising under statutoryprovisions which have not at the time been filed and of which written notice

has not been served pursuant to law or which related to obligations not due

or delinquent,

25. Pursuant to the Interest Act (Canada) no fine, penalty or rate of interest may be stipulated

for, taken; reserved or exacted on any arrears of principal or interest, secured by any

mortgage oz- charge that has the effect of increasing the charge on any such arrears beyondt11e rate of interest payable on principal money not in an-ears; accordingly, no opinioi7 isexpressed o~1 any provision of any of the Loan and Security Documents that has such effect.

26. No opinion is expressed in this letter as to any of those matters which we leave assumed foi-the purposes of rendet-ing the opinions expressed above.

27. Enforceil~ent by Sidney under the Loan and Security Documents is lin7ited to the actualamount of the indebtedness of the Debtor to Sidney under the Loan and SecurityDocuments notwithstanding that the aggregate principal amount secured by the Loan andSecurity Documents may exceed such indebtedness.

-8-

28. We express no opinion with respect to the effect of any appeal of any Order made 1~y thecourt ii1 the Proceedings on the validity or enforceability of t11e Loan and SecurityDocuments.

29. All opinions which expressly, or by necessity, relate to the validity and enforceability ofe~cl~ of the Loan anc3 Security Docuil~ents may be subject to any of the foregoing mattersand limitations.

to

C'itti ~~1' I~~~~ti~~ ~4(a~r~~ ~ ,~~:~~ f ~~;~tt~~

2a0 Sif)NE;Y 51.

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►'~~i,ri~ 1~otar Taxes

• PaG~ itt {~erc,~ra 1~~ r;{ 1~. il~c:ft~4. ciir~<~t ~icbit\-tai3 «~~ de3icGr ~~cur cl~ec~i,e

• Chc'i~ue F~~u,i be made ,?a•.,Ehle it}: Cìty~ of Qelle~ille• Ira: trt ~n~ ~,t~artc.ee4 E3~vik tt~ scf~ rce cfaar~ sn«~

~t~~~E~ x• Ya~~ via cti~-~ine. Ear telepn~~F~e (~a~akin«. Pie<ksw use your

,=~;~essn~er~t F:c~t! n~~rc~i~~r~E~ the relerei~ce ~,~#renl'{Tit f't ,',I ti t :;C,

• `DROP SO~f:g' ~i~r !r~x ~?a~ rnei~t~ are ls~cattii 3tBe1te~~i!!e ~~~ater. t`1~ Cofiete S[ il~. I3elieritic.<?'v tin~l [tccrc<~iion. <~uhural ar~cl Ct>a;rrtu~~it~~Setzice . (~ui~~ie 5~nrts {èt~tre. ?{~j C'aanift[>nIZ~l..I3elie~~rlle .(~~;.

E lca5e t~~ .icivi~eci that ~c>t~r a~cc~~~i1t x~ rn ~rr•e~~rs.1='i~~ures til~t~~~'r3 beic~~~ are ei~ttc:titie fir the ~ut~r~tz3t T~~c~{~t17 ~~rxi ~~-ill ct>nti3luL tt~ accrue, intc:r~st~~t I .?>",, c~~~ 11~~ f~z~st c~f~e~.iel~ m~~r~t}~.

.~lccot~r~t ~t~t~~t~~<ia-~~

~asati~r~ Yeas- Penalty a~3ct Interest Tapes

C'urr~rtt ~ j.8I4.62 ~{)4.75>.C~t

2Ql 5 ~().C)0 ~f}.(}f)2t~~a tee o~~~~r- ~a.a~ ~ ~ ~~.~o

~rt~~~~I. ~~~r~tr;v~r ~~~~:: ~2~~,o~a.o~ _ ~ ,E~'leasca t~c~t~ a r~~eipf i~ coot v<~lid un~ii ~ et~eq~ae cle~~•s the E~aixk.

~s ~c~- I3~~la~~~# 2(~)]-~-'1 l a ` 3,00 actrt~zn. charge is a~glir~bl.e der Nofice cif T.~~ :arrears

lulu t)i. ?4}j 7f'it~ c~f'~3eilc~°~i#€.~ 1?O~.C)Ci{).lf)~(11~t~().{)(:)()f)

~~ ~~~ ~ ~yi;~~,,,~~ ,..~~~ t~ ,fat ,~ ~ ~ 7~_,,.., I~i~,,i7~,~.~ ~,i _;;r _ Tatal ar~ac~iar~t z~~~e: ~258,0~,(}.flit - . `~

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I Ill III hill I II~II I~III II [ lila! Il~li I,~~~ ~I?~I ~IIII I II II~II I II IICfI 1111 Ili(I Illil III illl3 . in pernn at ( itti i?ai( er ?Zccrcaiiun. i)rt.{~ chcyue ~~ <icrpt~,i, h~,~.

Ct~lturatt <~Cara~ntuait} Jer~~iei I)eparlritenE S_ i'al at ti«an<ia: i~r~;titutit~=:os2. Aiail ~lxce~~:e ;« ~f~e ,~tia~~3; i~?r~t t)Cti~c ~ ['a} i7) tele,,i:o~ac-it~te ~n~ t f Erik gnu:

{'~~~ablr tee the r:itG a1 (3clfevi€!c.

"I"i3T~~E anataur~t ~~aici:

~ A~.~, S 5 3~~#90a~~ ~5

Cìt~~ ~f' ~3e[~e~~€ll~~~ ,: s; ~~t

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(18I7

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~'fJ~i~[C1~ (~~' ~I'~'~~'i F1~ZI2Fr~IZS

1 2f78.(?60. I ~)S~ 1 ~2(l.~)(7(?~} .1u1v ~5. 2t~ 17

RG : I' 1~ ~. ~~I I=. Ft I1I)L\.~ J~ ~ c~ (~~ 1~ 1 ~.~ L

...•.3 t ~~~~~ 1 £ 1.~~

2IRI9~1~) ~'.'~R~I~ 1

P<~vir7~ lour "Taxes

• P~z~,~ in ~~~rsvn 'E~~ cash, cft~ {~c~r._ ,iir~c~t debit

• ~faii ter cteli~~er G~tzr ehcque

• CE~eque mtf<i he 2ri~icie ~~a~ahle tip: (~iti of L3ellevili~

e F'ay iii z rit Charter~~~i 13<ink t.i crviL ~I~tzr~c_ m~t~~

• I'a~~ cia are-line yr teI~E~I?ene i>~t~~kin<<.. 1'~ease ~is~ ~c~tsrr\:~~snict~t Rvli riumhtr as tilt re t~;:ret~ ~ i~?~er~~`f7i1 iC'L.~\Si'C.

• '~ROI' f3(}\ES' (,r t.a~ ~>z.~rnent~:are i~~catcd a~Belleville ~ti~afcr. 1~)5 t.'vl~~~t ~[ ~~, t3eli4bil(~~('~~i anci KeC~'eati«rt. Ci3(tural a{~d t~nintnt~r~it~

Str~ i~c~, t,>ui~~t~ ~E~~,it~ ('c:tlir~. ~fi~ C ~.nni~t~~~i

12c1..I3c1lci ille .(?\".

('1~t~se Ise a<i~ ised th<~t ~c~ur ~:icc«i~3~t i~ in r~ri-eaz~s. ~"}~€~~~~-ts sl~o~~~r~ l~elo~~~ are e,i:ec:ti~e f~~~' tl~e curi~~:~~t ~~~c~~~tl~ and ~~~ill c~~ztir~~3c tea ~zccr~~e ir~tc~'e~tat 1?~"%0 0~~ tl~e fiat ~~f~c:ac.i~ r~lnr~rh.

r _ _ _ _ _ __~t•s~t~~~~~i ~;ttnini:~r~

Taxatfa~i Year ~'enatt~~ ~n~f I~Ce~•e~t "~a xea

~ur-rer~t S~E~.F~1 ~ e

~I2.%26.94 ~- ~ '~ ~ ~ ~,~;

2(}16 ~27~k9.0E~ ~_ ~16.35Ei.83 - ~.2015 ~~~.(a0 Q-~ ~tJ.C)02014 ~& o3dir ~f~.{)t3 ~~ $Q.{~O -' r .

Ple~~se E~sate .~ reeei~t is n~~2._tiàlici ~~n~il ~ cheque clea~•~ the bank.;~s per- I3~ 1.iF~~# 201 ~-I 1 .~ ~3.~t~ adr7~ira. ~har-~e is .i~~ticable ~~er i!'t~tice cif' "Tt}s Ar~•ears

.I~it~~ O5., ?Oi?~~'i~~° ~f ~~~Il~~~~~~c> 1?f~8.~~0.1 ~5C~13?O.UOt~Or rq I rv~,! Stri~c:

~t ~~~~~.,,,,~. of.-'t~- ,._,~ To#a[ a~3~o~~nt ~i~ze: ~i32,29~.~-~ ~ ., s

t:asl~ I3ebit (~t~egi~e

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2. ~iai# cheque [o Lac ~lttricip.ti Of~(ice ?. i'ati fa}' ieicphanc; i~iitrn~~t I~inku~,'.Par,ibic 1~~ the Ci€r ~:~t ?3e(ici ilìe_

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BE~LEVILLE

i~9 ~~o~~~T s-rBELLEVi:LE, fl~ KBP~ ~Y3Tel. :(513j X58-fi~81 fax :(~i13; 9G"r'-3206

24Z~3Q49 ONTARIO tNC904 CQU(VTY ROAQ 1I~y~~A~~~, ary ~~~ ~~z

cmr o~ s~t~~uz~i~

~. a ~ ~ .~

Dated : 31-May-217

Gr~~:: ~~-may-zap;

7G ~ 3?-tv1~y-2~'f7

CHihP.GES ANL~ CR~~i7a AF?L E2 ~iliiS C3ISe'JÌ(~ L Ar P~.:,R CAN P1c:(T .~`,TA?Ekri~t~F v

St~:tement Period

j Luke j Description Amount~_

OS Feb-20I? PREi,' IPtV-2017G4Q3 ~ c ~ ~ ~",~ ~ ~~, ~ ~ ~ ~'~"~ ~> ~f ~~ ~ ~ 181 .4113 Ma;-2fl17 PREY-INV-2017057fi 2152.33

jU5-Ap,-2~i7 FREV-I~dV-~~l~~e~99 X417.3328~~Apr-~017 PREV-INV-24170SQ^F 2`JI7.3~

'•2~-~~1ay-2017 CURR~INV-2(}i.71%21 2017.33

i

MesSa~e re' oiit5~andlna sewer c~iar~cs

Section 39 (2) Qf the Ut lunici~al pct 2(~~l permits t ae ~;olleetion cif sev.~er cl~dr~es in tine

same, maz~n~r as f~~xes. If t ie. a~c~ve-noted charges ~'e ~.ot paid in full try Suns 34, 2017,

they will lac added tc~ dour c~utstaz~dist~, pro~e~t}~ fiax~s. ~ 5°i4 Ac3xz~z.in Fee ~~i.11 be added

w~ez~ transferred t~ tars.

2017.33 ~~Q3~.66 ~ 215?.33 ( 1814.E}1 ~ 10018.73

CURRENT 3i-60 DkYS ~ 6i-90 DAY5~~ OVER 90

a~Eis= Q~~v~ ;~isaa~~Cu~iT Total : 14018.73

f ~ 1 ~ ~__.~

~ 1 ~ ~ -~ ~ t

GST;HST Registration Nv. 10E~9z998?

Please return this portion with your payment

Cheques payable to CITY GF BE~LEV}LLBCustomer Number : ONTAR021

Custa7~er Name : 2428Q49 ONTARIO 1NC

904 COUNTY ROAD 11

NAPANEE, flN K7R 3~2

Remit Paymeni To

CITY C3~ BEII.EVELLE

189 FRONT ST

BE~LEViLLE, C7N KSN 2Y$

Statment DaEe ; 31-~~1ay-2017

Amount : 1Q018.73

Amount Paid

r~ R ~J h i A R ~ ? l

c ~~~~ ~~ ~ ~ ~ << ~ ~~~~r~„s,~

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?-'.~8f1d90tV~E~AR10 (\'C' REi' Itsi~}1'~T CATS i!~'Vi;~ f 1 f2['?fRl~)2s1(! ~'Af2l~ ifi r} Stt)\f:~ 5T.

13ELi.EVIt..1.f: Q~ K~;('?7

AstictititTkiai ~ ;lgUttiCi~~~s[ ~ Ec1uc;3iii'>n

T.sx C',as. ~àlu~ 1~ ~fiuttici p:~! LcUics `tax Rate (`rsi Ame~uFat 1'zEx R;tfc tuet :~n~aant

1X~ ~~E~.~iti i;v27 t1:1':1Ct.,~iv[~- ?vfl'NI~f~VY;NOS fi.()~?~i<>9!> 1'.;i~._'r (~{)t>'>ft{itxi ~.'~.1c>.6(,

$uhTot,ii> 'v3unicip~lLcvy 3?.31k?h Fclttca€[~an1_cvY =#~)4h.Cif>

~(lS°C.1.1~ (_~1i#3~L4S/~t"Cc~itS ~tl fTtlll El7"~' ~~

~ TaX ~..c=VV' ~;3 t1'~O(8) (~tl (l4Cf~7:1t+~.".tjUC:llfi)fi} ~ i. ~(3•~ ~)%~

SE~e~~ial (~h:~r~cu'Crccfit~ 0.C)(1 ',

;'(717 "T~a~ (':~(~ Acijc~s(n~i'nti

{}.()t}

!_ess It~icrim €3illin~: fS,I7t).F)w}

F:s t [)uciC'redit t.°~s t>i ()tif 19!2(7! 7} 2?,()7k.2

~Iàal Ìt~sa~ r'~~~~offiZt [~uc $ 36.172.2Ei

ti(3'I`F: T~h€ "Fast I}~se" reflects :arr~x~unt r~tivin~; ,~~; of'~i~,~~ hiilii:,= d:,t~. A~~~IiEi~~n::1 i ~terc~t ch;~r~e 4+~i11 be ~iX~Erlic,3l~t~ cir~ Jane l r X1)17

Please return this portion with your payrr~ent

~:~~~ ~~~~~' ,`"~ ;III Il: Il Il it ;I~ ~~ i t I Il i III Ifl I!1 I I H i1 i! 1! ~'x~~~~~. ~~~~~,~~r,~-,~~ _~{ ':e. 4 .,,~ ~: :. S~cDnd instaiim~nt

- Lt; I".: ~',}/R(zIJ€. ZJI Y-Y•,- _ -. ~.'; ~'s

~t"'7. ~i M

pue Dak~: ~ Total Amount t?ue .

2~i'?ti(1<#£1 t>ti'T;1I2tC} f\C` At»Dunt Paid

t ,,, ~ ,.,~~c~..._.~ ,.ins.1 ~ q

1 11"1fl1'~;-il ~I #~1'~f~~l li~~#~~1i~~1~~t~~ i1I ► t~ t~~t~ ti--

■~~:

f rt1~ ~~f ~3€Ile ~+idlc~~ ~ ~~ ~.e ~. ~~ u:,:. X31, k.RN '~~8

r~-~ - Ti ~ ;~lxt~~t~ F 13-~~~'-32~1

13illir~~4 C7ait .ti1''E~$~

113y T9. 2417 l ~~+c

R~,IE ,'v<,. 12118 E)fit) 1951) t-~t)t),!?t►13t► '~1Grna~:as:c Ct,:

'~ti SEDtiE:Y S'1`7-i kO-#`? (~~ i,ARlC3 [\C t~C#' IRi~1 ('"1~ I_OTS ? IEJ ~~'~'fa i i Rf' 21K 14k1~3 PAC::`[' 2 J2I'? ~:tl SIt)'~F:l ST 'II\IL1iS~ PJ~3ZI

~.~e~arnrtit 1luitiri~~af Eclttc.iti~>n

Tax E~las~ Vaiut: Municipal 1_Ctiics "I~t~x Kate r~l,l tirnoui~t "Ian R;i. {~~} Alt3«3.y~tC"[' ~' '.ItiZ.litil Ct~~~t ~TX:<~I~LL- eft ti StI,AItELI: NC) SL' ~ {J.t)37b7h54 ~ 68.7Cs1 .{)3 U.{}t' ~ ,r'F~t? ?x.501 J'-ri'T' N ftt .1>t) CND Ì~ S•ft;Nif~IR~IL L~ S-l`: N(_7 SliPi'O f).t}346t-{£);' ; 5''0 -Sd + ' ~1 ~ ~~~~3-?<~

Suh`1`~tals ~~uniti~al E.eti°y' ?~."?1.-17 ~ ~duvatiar~ lso~v 33.~3~_98

54~~it'i.1! ~'~1 tir1~C:4fLCCi~tf~ ~ SUR7ttl:1CV

.T..BX ~.rCY~~ ~U~)-7UI:1~ ~iti`~tiO~Cl~i~~-~~.tjUC;ilfOIl) 2~~K. ~~}~?.-~~

SEscci~t Cl;<zrges/C`t~Zctits f}.Ofl ~

l..e,~s [rr4crim I3itEin~r 45'_,~?7; tt?i ~,P.zsi Duc,'f."re<3rt SA~ciE f)5(Itlt?(}!7} ?3.i l?.??

Tc~~~~l ~ "te>t:~t Elmotant [~t~~ ~ ?i4.dt.}{a.fr3 J

ti{3ìIr: '1'1r~ "P~s€ Die" re~I7erts =arnaunt ~~~~~ing a~; oF'~9s3F~ 3aitli~ ~ :- c3:~t~~, ~dditin, .,P~ interest cli~t~~;e t~~i~l by ri~pticail~ie on J?brz~ 1. ?1)17

~ ~ttvtt~'t t:alcsiTte,,

.. _ .. ~ .. .-j ::3C'~7t1Ui3£": t) 4_i?f~7_ik'f~~

titM£~I_~1j Il.[~F: C)~ KRi' 3"I.3

3~ ~ ~~ j! ~ ~ ~~ ~ ~~~~~ ~ ~~~~~ ~ ~~ ~~ ~~~~ ~ f~ ~~ ~t ~~ ~~~ P3ease return this p°?l,~I:wi~tti our paysner~t

l~ 1~_ _ ._

CO#Id TI7~td11Rtkitt

ROII #

Due [late: ~_._~.~..~.. Total Amount Due

Amaunt Pain

CFPAYt.~:'~YT 43'?~~^.~.

~ '., z~. P~~~Irr-~rvc~ ~~~

ii~~i'~~i~~~i~I`t~~~~~~ ~1~<~~~~~ ~~~lP t111i~~~'~ilit tlr~l~{IiI .,~_--- .. .. .

to

,~, Canada Revenue Agence du revenuAgency du Canada

Tax CentreKitchener ON N2N OA9

BDO CANADA LIMITED502 - 419 KING ST WOSHAWA ON L1J 2K5

Dear Sir Qr Madam:

Re: 2428049 ONTARIO INC.Account number: 80216 2578 RP0001

RECEIVED J~;~1 - 2 2n!7

May 29, 2017

Account Number80216 2578 RPd001

we have been advised that you haves been appointed as receiver forthe above-named. At present, there is indebtedness to CanadaRevenue Agency {C~) for source deductions amounting to$28,147.98.

Particulars of this liability are as follows:

Date of assessment (DD/MM/YYYY} 29/03/2017Tax deductions: $25,090.37CPP: $ 0.00EI: $ 0.00Penalties and interest: $ 3,Q5?.61Total: $28,147.98

Grand total: $28,147.98

Pursuant to the provisions of subsection 227(4) of the Income T~Act {ITA), subsection 23(3) of the Canada Pension Plan (CPP),subsection 57(2) of the Unemployment Insurance Act {UI~),subsection 86(2} of the Employment Insurance Act (EIA), thefollowing amounts, which are included in the above totals, aretrust Funds and form no part of the property, business, or estateof 2428049 ONTARIO INC. in receivership.

../2

~.ocai • 519-570-5438~ Nati4n al In$oly ncy Office Toll Free : 1- 6-323-0336Canada K~chene rU~Jk ~t2~e0A9 web site : 5~~- c7a.g 2ca

- 2 - Acct No: 8021b 2578 RPOOQI

Federal income tax:Provincial income tax:CPP employee portion:EI employee portion:Total:

$28,724.20$ 6,366.17$ O.OQ$ 0.00$25,090.37

Grand total: $25,090.37

Payment for the total amount of this trust, namely $25,090.37should be made to the Receiver General out of the realization of

any property that is subject to these statutory trusts in priorityto all other creditors. Please forward payment by return mail. Inthe event this is not possible, please indicate when payment willbe forthcoming.

Please advise when payment of the remaining balance of $3,057.61

plus interest up to the date of payment will be forthcoming. Yourattention is drawn to section 159 of the ITA, subsection 23 t5) ofthe CPP, subsection 57{4.1)of the UTA and subsection 86(4} of theEIA.

This letter also serves as notice that should payment be made forany amount described in subsection 153{1} of the ITA for periodsprior or subsequent to your appointment, tax deductions must bewithheld and remitted in accordance with this subsection andIncome Tax Regulations 101 and 108. Your attention is alsodirected to section 3 of the Unemployment Insurance (Collection ofPremiums) Regulations, section 5 of the EIA and section 8 of theCanada Pension Plan Regulations.

If you require further information, please contact the undersignedat W. Rueger.

Yours truly,

(~—

W. Ru er 1215Revenue Collections. _ ___

a

,~, Canada Revenue Agence du revenuAgancy du Canada

Sudbury ON P3A 5C1

2928099 ONTARIO INC.C/O BBO CANADA LIMITEDOSHAWA EXECUTIVE CENTRE502 - 419 KING STREET WESTOSHAWA ON L1J 2K5

Page 1 of 4

oaoss7~

Notice details

Business number 80216 2578 870001

Period covered Jan 1, 2017 -Jan 31, 2017

Date issued Mar 3, 2417

Notice of assessment for goods and servicestaxlharmonized sales tax (GST/HST)

This notice explains the results of our assessment of your GST/HST return(s}.

The amount you need to pay is $212,931.98.

Thank you,

Bob HamiltonCommissioner of Revenue

Account summaryPrevious payments may not appear if they have not beenprocessed. if you have already paid the balance owing, pleaseignore this request.

Total balance: $212,931.98

Go green, go paperiess!Get your mail online through My BusinessAccount.

1. log in ai www.cra.gc.ca/mybusinessaccount2. select "Manage online mail"

RT299-A E X

Canada

Page 2 of 4


GST/HST assessment

Results

Notice details

Business number 84216 2578 RT0001


Date issued Mar 3, 2017

This notice explains the results of our assessment of the GST/HST returns} received on February 28, 2017,for the period shown above.

Description ($) Amount CR

Result of this assessment

Precious balance

Total balance

1,053.96

21 ,878.02

212,931.98

To view your up-to-date account information, including payment transactions, ga 20www.cra.gc.calmybus inessaccount.

We may take legal action to collect debts that you do not pay voluntarily.

Need to make a payment? Pre-authorized debit is naw available for businesses. You can set up apre-authorized debit agreement using the CRA's My Business Account service. Far more information onpayment options, go to www.cra.gc.ca/payments.

For more information, please see the "Summary" and "ExpEanation of changes and other importantinformation" sections of this notice.

Please keep this notice of assessment for your records.

Page 3 of 4

000,s~a


SummaryReporting Period: Jan 1, 2017 -Jan 31, 2017

Reference Number: 17059000332340236

Sales and other revenue

Notice details

Business number 8D216 2578 RTOOd1

Date issues! Mar 3, 2017


Line Description ($) Amount CR

101 Salss and other revenue 116,367.43

Balance calculation

Line Description ($) Amount CR

105 Tatal GST/HST and adjustments 15,127.76

108 Total ITCs and adjustments 14,074.23 CR

109 Net tax assessed 1,053.53

Arrears interest 0.43

Result of assessment 1,053.96

Explanation of changes and other important information

We processed your GST/HST return for the period ending January 31, 2017.

We charged arrears interest because you did not pay the amount owing by the due date.

Page 4 of 4

More informationIf you need more information, go to www.cra.gc.ca/business.

To see your latest account information, including paymenttransactions, go to www.cra.gc.calmybusinessaccount.

For information regarding options for adjusting your return, go towww.cra.gc.ca/gsthst and select the topic "Correcting aGST/HST return," or see Guide RC4022, General Information forGST/HST Registrants. For faster service, submit your requestelectronically.

if you disagree with this assessment, go towww.cra.gc.ca/resalvingdisputesand select the topic "Goodsand services tax harmonized sales tax (GSTIHST)" for yourobjection options. You have 90 days from the date of this notice toregister your dispute.

Definitions

CR {credit) is the amount we owe you.

Help for persons with visual impairments

You can get this notice in braille, large print, or audio format. Farmore information a8flut other formats, go towww.cra.gc.calalternate_

Direct deposit

Direct deposit is a faster, moreconvenient, reliable, and secureway to get all amounts depositedinto one account or to have refundsand rebates from differentprograms deposited into differentaccounts. For more information, goto www.cra.gc.caldirectdeposit.

Get your mail onlineYou can choose to receive yourmail online. When you register forthis new service, we will no longerprint and mail mostcorrespondence to you. Instead,we will notify you by email whenyou have mail to view in yoursecure online account. For moreinformation, go to www.cra.gc.caJmy8usinessaccount.

a

Period End 10/31/2014 11/30/2014 12/31/2014 01/31/2015 02/28/2015 03/31/2015 04/30/2015 05/31/2015 06/30/2015 07/31/2015 08/31/2015 09/30/2015 10/31/2015

Sales & Other Revenue 42,544.34 73,271.66 73,774.83 73,774.83 73,774.83 73,774.83 73,774.83 73,774.83 73,774.83 73,774.83 73,774.83 73,774.83 73,774.83

GST/HST 13,725.44 10,171.97 1,396.05 9,590.72 9,590.72 9,590.72 11,525.03 9,590.71 9,590.72 9,590.72 10,153.12 9,590.72 9,590.72

ITCs 646.66 1,385.00 2,242.83 1,329.01 1,103.27 1,934.31 11,100.44 1,315.88 1,604.61 562.40 15,827.66 10,407.45 10,062.11

Net Tax 13,078.78 8,786.97 (846.78) 8,261.71 8,487.45 7,656.41 424.59 8,274.83 7,986.11 9,028.32 (5,674.54) (816.73) (471.39)

Outstanding: - - - - - - - - 549.80 9,655.10

11/30/2015 12/31/2015 01/31/2016 02/29/2016 03/31/2016 04/30/2016 05/31/2016 06/30/2016 07/31/2016 08/31/2016 09/30/2016 10/31/2016

83,740.00 214,901.00 147,810.18 235,137.71 195,819.00 157,531.86 139,555.97 333,733.03 126,524.43 122,166.90 110,225.06 127,43337

10,886.00 28,423.48 18,972.55 30,261.03 25,020.42 20,575.12 18,142.27 37,142.14 16,448.17 17,515.55 14,589.83 16,566.34

7,545.50 21,171.18 15,374.65 0.00 10,042.49 7,719.87 8,255.95 8,900.77 6,562.22 9,899.91 6,712.04 5,591.55

3,340.50 7,252.30 3,597.90 30,261.03 14,977.93 12,855.25 9,886.32 28,241.37 9,885.95 7,615.64 7,877.79 10,974.79

11/30/2016 12/13/2016 Total

210,942.50

3,513.20 7,595.02 6,281.38 31,432.34 15,494.07 13,242.03 10,142.13 28,849.68 10,056.22 7,715.12 7,946.97 10,974.79 4,118.20 33,890.71 201,456.76

a

01/27/2017 FRI 11:32 FAX

The HonourableMr. Justice Byers

X602/402

Court File No. CV-15-0223-00

ONTARIO ~hkts~ay;'~~ I`)~~'SUPERIOR COURT OF JUSTICE p~ ~ ~ ~ ~ ~J~S"

HAMILTON SMITI-! LIMITED

- and

Plaintiff

2428049 ONTARIO INC., STRATHCONA ENCRGY GROUP, STRATHCONA ENERGYGROUP INC, and SIDNEY STREET PROPERTIES CORP.

~ ~ r •

Defendants

THIS MOTION, made by the plaintiff, for an Order dismissing the within action and

any crossclaims against the defendant, SIDNEY STREET PROPERTIES CORP., was heard

this day at Belleville, Onta~ia.

ON READING the Consent, filed, and hearing from the parties,

1, THIS COURT ORDERS that the within action against the defendant, SIDNEY

STREET PROPERTIES CORP. be and the same is hereby dismissed without costs,


~NTAI~OS~TPEI2IOR CO~'~ Off' J~JS7i SCE

I'i T Z'I-~E MATT~12 O~ the Construction Lien Act, R.S.O. 1990, c. C.30

~ IA~SC~GTHE HONOURABLE ~~`~lt--, ) T ,THE ] 2TH

JUSTICE ~; . ~~ ~ ~ ~,~~~..~~ ) DAY OF JULY, 2016

B ETVv EEN:

(C 1"Seal)

:,

• ` .. HAMILTON SMITH LIMITEDPlaintiff

and

2428049 ONTARIO INC., STRATHCONA ENERGY GROUP, STRATHCONAENEKGY GROUP INC. and SIDNEY STREET PROPERTIES CORP.

Defendants

JI7D~N~El~T

THIS MOTION, made by the Plaintiff for Summary Judgment and a Declaration on its

Claim for Lien, was heard this c3ay at the court house, 15 Bridge Street West, Belleville, Ontario,

K8P OC7.

ON READNG the Motion Record of the Plaintiff and the Minutes of Settlement dated

June 16, ?016 signed by the parties, no one appearing for the Defendants 2428049 Ontario Inc.,

Strathcona Energy Group and Strathcona Energy Group Inc.,

-~-

1. THIS COURT ORDERS that the Plaintiff is granted leave to proceed with its Motion for

Summary Judgment.

2. TI-IIS COURT DECLARES that the Plaintiff is entitled to a Liez1 under the Construction

Lien ~1ct on the lands and premises described in Schedule "A" of the Statement of Claim in the

amount of $110,040.00.

3. THIS COURT DECLlARES that in default of the payment of the sum of $110,000.00, plus

interest from the Defendants Strathcoi~a Energy Graup; Strathcona Energy Group Inc. and

2428049 Ontario Inc. or any of them, that the estate and interest of any of these Defendants having

an interest in the lands and premises described in Schedule "f1" of the Statement of Claim may be

sold and the proceeds applied in and towards the payment of the Plaintiff's Claim for Lien and

interest and costs, pursuant to the provisions of the Construction Lien Act.

4. THIS COURT ORDERS AND ADNDGES that the Defendants Strathcona Energy Group

and Strathcona Energy Group Inc. shall pay to the Plaintiff the sum of $110,000.00 for breach of

contract.

~. THIS COURT ORDERS AND .ADJUDGES that any amount paid by any of the

Defendants against the suzn of $ 210.000.00 pursuant to paragraphs 2 and 3 of this Order sha11 also

be credited and applied against the amount owing to the Plaintiff by the Defendants Strathcona

Energy Group and Stz-athcona Energy Group Inc. pursuant to paragraph 4 of this Order.

-~-

THIS JUDGMENT BEARS INTEREST at the rate of 2.00 per cent per year commenczzlg

on July 12, 2016.

1t _ ~i)l~1111\\rt~

(Sign re of Judge)

~IIfi~Z6~ A

JUL 1 9 2Dt6

an ~~k l~Ta. ~3~~su ~iegis~r~ ~I~~

' ~ ~HIEI)LTL~, "A"

PT LT 7, 14-11 RCP 1819 SIDNEY PT 2 21R19~19; ~3ELLEVILLE;COUNTY OF HASTINGS

HAMIL~i~ON SMI"I,H I.,IMITEDPlaintiff

-and- 2428049 ONTARIO INC. et al.Defendants


ONTARIOSUPERT0~2 COURT OF JUSTICE

IN TI~~ MAT'TER OF die Construction Lien Act, R.S.O. 1990, c.C.30

PROCEEDING COMMENCED ATBELL~VILL~

J UD(JM1CN'T

O'~'I,YNN WE~SE LI.,PBarristers &Solicitors65 f3rid~;e Street EastBelleville OntarioK8N lI_8

John MastoralcosLSt1C# 44389Ejmastoral:os(a)owtla~v.com

Scott McMahonLSUC# 55608Vsmcmahon(n~owtlaw.com

Tel: (613) 966-5222Fax: (613) 961-7991

Lawyers for the Plaintiff

to

IN THE MATTER OF THE RECIEVERSHIP OF


RECEIVER'S STATEMENT OF RECEIPTS AND DISBURSEMENTS

AS AT JULY 27, 2017

INTERIM

RECEIPTS:

Advances from SSPC (Receiver's Certificates)

Rental Income

HST Collected

Total Receipts

DISBURSEMENTS:

Filing Fee

Insurance

Telephone

Miscellaneous Disbursements

Payroll

Payroll Deductions

WSIB

Snow Removal

Utilities

Repairs ~t Maintenance

Bank Charges

Leal Fees

Receiver's Fees

HST Paid

Total Disbursements

RECEIPTS OVER DISBURSEMENTS

$ 75,000.00

847,426.24

103,487.96

1,025,914.20

70.00

33,658.43

1,336.48

560.12

71,717.66

21,146.92

575.20

3,687.62

357,116.91

141,268.96

728.08

106,997.86

74,415.56

102,710.98

915,990.78

$ 109,923.42

Notes:

[1] The R&D reports a net HST payable as at Juty 14, 2017 of $776.98.

to

Court File No. CV--16-115ba-40CL

B ETWEEN;

ONTARIOSlJP~RIOR COURT O~ JUSTICE

COMMERCIAL ~.IST


Applicant

antl -

2428(}49 ONTARfO 1NC.

Respondent

APALIC;4`f[ON UNDER SEJBS~CTION 243(1 } OF THE BANKRUPTCY AND INSOLVENCY.ACT,

R.S:C X9$5, c. B-3 AS AMEI~D~Q AE~D SECTION ~~1 OF THE COURTS QF Jl1S`f'[CE ACT, R:S.Oi 990, c. C. 43, AS EIMEND~D

AFFIQAVIT OF BR1AN PRITCHARD

I, BRAN PRITCHARD; of the Town of Ajax, in the Province of Ontario, MAKE ~A'TH AND 5AY that:

1. 1 am a Senior Vice Rresident of BDO Canada ~Tmited; and as such-have personal knowledge of the

matters referred ~o herein.

2. By Order of the Honourable Mr. Justice Peniay, dated Decemher~ 13, 2flib (the "drder"}, BD~

Canada Limited was appointed Receiver {tf:e "Receiver") of 24280~r9 Qntario Inc.

3. Pursuant to the Order, the Receiver has provided services and incurred disbarsernents which -are

more particula~Ey described in the detai[ec1 accounts attacr}ed hereto and marked as exhibit "A".

2.

4. The time shown in the detailed accounts attached as Exhibit "A" are a fair and accurate

description of the services provided and the arr~ounts charged by the Receiver, which reftect the

Receiver's time as bitted at its standard bitting rates.

5. The Receiver requests that the Court approve its fees and disbursements far the period from

September 15, 2016 to July 26, 2017in the amount of $54,27b.14 plus HS7 of $7,055.9Q for a

total of $61,332.Q4, far the services set out in Exhibit "A".

b. This affidavit is sworn in support of the Receiver's motion for, arrtong other thins, approval of

its fees and disbursements and those of its €egal representatives and far na other or improper

purpose.

SWQRN BEFORE ME at the City of Oshawa, )in the Province of Ontario, this }27~ti day of Duty 2017 )

~ ~ _~ ?Commissioner for Taking Affidavits, etc }

A~;r1: Kkn k',olt, a Con~miss3aner, eic., 1

P+,.,bica of Ontnno, for dD0 CanaB:~ L€.P

unJ L'DO Canada Umiiad, 7rustea to

6mikrv~~tcy and their subsidttu iris

e~ssodules slid aHltfales.

Eu{~i~es April 17, 2Ql8.

Brian Pritchard, CIRP

3.

This is Exhibit "A" referred to in the affidavit of

Brian Pritchard

Sworn before me this 27t~' day of July 2017

A COMMISSIONER FOR TAKING AFFIDAVITS

Ap~;l Kim ~i~~11. n fcm~rttasionet. etc.

Province at Ontario, ter 6D0 C~v~ectfl L~F'

ur~d BL)O Ceuiodii Lirrwtod. Trustee in

4}[~nkrupicy and Shoh suUsWfcuic+3

[usocird~s end affiliates.

ExplEe5Apri1 V. 20 t8.

Te!' }16 &65 Oi+t? E,DD Ca;ta~Ja Litci~~:d~a~ =f,oEbS49G4 i23F",oE~zStreeilV,S~i~ie1'i00wvrw tido.ca Ts~iei~ta Jt•~ hi~J Z's12 Canar!a

INVfl1C~

2428049 t~ntaria Inc.250 5ldney StreetBelleville, Ontario

Rate

Ju(y 27; 2017

lr~vorce No.

#002-SSP

Re '2428(}49 Ontario lnc. -Sidney Street Praperttes

FCI.R PRO~'ESSJONAL SERVICES RENDERED ~n connection with the above-noted Receiversf~ipEngagement for the period from 5epter~ber 'f 5, 2016 to July 26, 2D17 as per the details below..(Phase note that time from September 15, 2016 to Novemi~er 2, ?O~fi was not Eiil[ed. an previousInvoice #Q~1-SSP dated Jaj~uary 30, 2017}.

Our F'ee in A[.E

Disbursement:

Tra~~[IMi [eage

Administrative Fee - 4%

Sub-rota!

~sT - ~~;oi {~Rio~~~s~z~)Total Due

$ 52,T88.60

2,087.54 2,087.54'

X4;276.14

7,055:9

$ 61,332.04

Summary of Trme ChArges: Hours Rate Amount

B. PriCehard; Partner 17.50 510.Ofl 8;425.OQM. Chow, Partner 1.00 595.00 545:OaG. Cerrato, Senior Manager 83.30 465.Ot1 38,734.5a

M. Marchand, Manager 0.3{7 3G5.00 '91.50K. hAasciantonio, Senior Admirii.strator 1.40 195.00 273.00T. Montesano,. Administrator 2.44 '198.00 475.20B. Sone, Administrator 2.00 145.00 390.00Adm~nEstrativ~ Support. 18.70 2,704.4 .

TOi'AL X26.60 $ 52,1$8.60

::~ (.. :c,d- t i~ ip,e ~> > . :.~ 1.,.7ie cs I'G;J . v;; n _ {_fir:, nCc) o,'.i .l.i . ...~ - ~~:sr 5~. ~,~•rb ?ic'- h3i F~~nrr- ~>hl~. , r. ..r .. ~iE ln~; n o1 :.n .~ i . .~C✓~. a Ir.~.nF .:-ry ;~ i -d _. or. tc~. a~:ri lGrm.. t~,rrt c u i..?-•,a ~..._..:?f, -~i;: .~r -nd ~ .rn ~,i..~.:r i~nne.

a ~ _ ~~ ' '

Date Professional

15-Sept-16 Cerrato, Gary

16-Sept-16 Cerrato, Gary

~9-Sept-15 Cerrata, Gary

20-Sep-1b Pri#chard, Brian

20-Sept-16 Cerrato; Gary

26-Sept-16 Gerrato, Gary

26-Oct-16 Cerrata, Gary

Z7-bcE-1.6 Cerrato; Gary.

28-pct-16 Prichard, Brian

28-tJct-fb Cerraeo, Gary

1-Nov-16 Pritchard, Brian

2-Nov-16 Pritchard, Brian

30-Jan-17 Cerrato, Gary

Description

Call with B. Pritchard re patentia! engagement; callwith V. QaRe re same.

Review of correspondence received..

Call with B. Pritchard to discuss issues and questionsfrom materials received -from I. Brady;- reviewingmaterials received. from i. Brady.

Gcriference call with V. UaRe. ~. Cerrato and I, Brady;review mater;al re environrnertat issues; discussionwith D. Jones re .risk assessment, discussion with C.hdazur re risk. assessment; prepare risk assessmentfirm.

Conference. call with I. Brady, V. Dane and B.Pritchard to discuss environmental risks re property:

Revievr of motion mate~iats and affidavit; executeconsen#s.

Reviewing correspondence re environmental issues.

Conference eal[ with V. Dane and B. Prrtc~ard;conference coil wiCh V. Dane, B. P~'itchard and I. Bradyto discuss MOE position re outstanding orders andReceiver's. ob{igations ~ncier the order.

!larious discussions with V. QaRe re appointmenC;environmental issues, discussion with G. Cerrato andV. Dane re amendmenC Eo Order, call to (. Brady;lengthy discussion wifh I. Brady; review court orderand other orders ar.d precedents.

Review of correspondence from V. Dane {Indemnityand Receivership Order).

Review amencments to Draft Order, discussion ~,vithVern Dane re insertion of Paragraph 23; discuss;onwith G. Cerratp re modification of appointment.

Review email and chances to Draft Order fromGoocirnans; erriail ta:V. Dane.

Final amendments to report; review of invoice for~rofessioi?a( time; discussions re report end invoicewith B. Pritchard and V. Dane; ca(t with B. Oue(let z-evarious ~ unding issues;. Steve Fink; snow plougE ing;review of Avaya reconciliation; assemble appendicesfor report.

~a

H rs.

0.5

0:3

1. (}

7[i.

0.7

1.0

Q.5

1 ..0

2.0

D.5

0.3

0.3

5;0

Date Prafessionat

3d-Jan-17 Masciaritonio, I<atarina

30-Jan-17 Montesano; Tony

3Q,Jan-17 Pritchard; Brian

Mascianton~o; Katarina

3~-Jan-~7 Chow, Mark_ Review court report and discuss with G. Gerrato.

31-.lan-17 Montesano, Tony Addressed questions from V. Chant wdrk on WEPPA.

1-Fef~-17 Cerrato, Gary Review of Avaya lease in detail; calls with J. Lon~ladere lease reconciliation issues; review of Avaya teasereconcitiattan; dealing with other funding_ issues;review of expenditures .and comrnunicatfons withBernie re funding and other issues,' call with V. Daneto review Avaya tease issues.

2-Feb=17 Cerrato, Gary

3-Feb-97

3-deb-17

3-Feb-17

G-Feb-17

6-Feb-17

7-Feb-17

7-Feb-17

Description

Retiurn call to employee re WEPPA nattce; draft emailto 7. Montesano re employee. proof of claim farVJEPPA.

C7raft interir€i Statement of Receipts ~ bfsbursements:

Finalize review of report; C{15CL]SSiOfI WiC~I G, Cerratore Avaya rent; email re rent recc~nciliatiori.

Further review of Avaya tease; prepare .teasereconcitiatian; prepare amended inyoicinQ for AYaya;call with ~, Pritchard to review Avaya lease- issues;dealing with funding issues .and communications withBernie and Jessica re same:

Telephone call -with J: Burnet re WEFPA claim; call toT. Manfesano re same; draft emaiC to J. Burnet resame.

Hrs,

0.2

0.:2

0.5

1.Q

0.5

~.a

5.D

fl.5

Montesano, Tony Numerous discussions with J. Burnet regarding iris 0.3WEPPA claim, 'address questions regardingdiscrepancy wiih claim, employment stark dale andcalculation of outstanding vacation.

Pritcfiard; Brian Emaits from Bernie re expenses; discuss en~ail from b.5Avaya regarc#ing rent arrears; disc with Gary reManagemeht of huilding in tight of termination of keyemployees at Strathcona, including the officer of thecompany.

Masciankon~a, I<atarina Discussion with T> Montesano re WEPPA claims. fJ.1

Pritchard, Brian Emails re rent, h4eet with Gary Gerrato 'tti discuss 0:5issues in relation to Ayaya

Bone; Beth Ann Preparation ~f Receiver Certificate and send to B. 0,5Pritc}iard for sign•',rig:

h~ontesano, Tony Spoke with L. RiCt~ards regardirg his Proof of Claim 0:1filed and W~PPA.

3

} ,~3

.S ~T

Date Frafessional Qescription Hrs.

8-Feb:-17 Montesano, Tony: Deal with inquiry frcm V. Chant anc4 A, D9Virgitio re 0.2V'JEPPA ruestions.

9-Feb-17 Masciantonio, Karari~a DrafC email Co BDOSupport re posting of documents on Q.1extranet.

9-Feb-47 Montesano, Tony Prepare numerous deposits. 0.5

9-Feb-97 Pritchard, Brian Discussi6n with V. Dane re court hearing; review Order 0.3of the. Gaurt; email re. funds required; wire transferfar payrolt and other costs.

94•Feb-17 Gerrato, Gary Calls with. D. Gould r~ listing agreements and ask for 2.6information toncertling market CEh~S 1[l Belleville for:similar space as tY~at being occupied by-5trath~ona andFatfi PV, cal( -with B. Rritchard to discuss occupationreek issues in respect of Strathcona end Fat1i PV; caitwith Bernie re various turn over and funding: issues;review of correspondence from V. Dane; calls with J.l.onglade re insurance PAP, call to insurance broker tof~ltcw up an. payment of I=ebruary 2017 insurancepremium.

14-Feb-17 Pritchard, Qi~ian Review Listing A~reemenh dra€t email re occupation D.4:rent, discussion with. G, Cerrato re occupation rent forStrathcona,• Ayaya issues.

~ 6-Fib-17 Cerrato,, Gary Review of listing agreements; respond to email 1.5inquiries refunding issues; colt with V. Dane to discussthe listing and .other-issues related to collection of.occupation rent from the receivers and /~vaya.

17-F'eb-17 Cerrato,, Gary DeGlin~ with func+in~ issues; caE4 with Holle~ts re "i.0missing assets aE tine site; discuss entering into anagency agreement with SSPC to manage the butldin~;call with V. Dane re ~~ari~us issues and discuss Avayafiundin~ problem and agency agreement concerns.

21-Feb-17 Gerrato, -Gary Prepare email rA amendments to listing agreement 3::1and forward to D. Gould; discussions with Q. Pntcliardre same .and review of corresFondence from V: Danere same; call with B. Pritchard re Avaya payments;review of email from Avaya re pending wire transferand overpayment of January 2017 rent; prepareamended March 2097 rent invoice takin; intoconsideration the January 2017 overpayment andfo~rard same tea ~lvaya; email fellow up ro the Hollettsregarding their decision to have 2428fl49 Ontario lnc.enter into an agency agreement with SSPC to manage250 Sidney Stree , E3e[tevilte, ON; review other emailCorrespondence refunding and other matters.

4

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}~~

Date Professional Description Hrs.

21.-Feb-17 Pritchard, Brian E}iscussion with Avaya, call to bank re coedit, review 4.5inYoices; discussionwith G. Cer~ato re invoices andlisting agreement; discussion with V. Dane re listing:

22-Fe~i•1.7 Cerrato, Gary Processing wire payrnent for expenses; review of 1:0comments .on. listing agreement received from D.Gou[d; Yeview of management agreement; discussionwfth B. Pritchard re same.

23-Feb-17 Gerrato, Gary Cott from B. Bentley re f~im escorting S. Ho(lett from 1.5the 250 Sidney Street;, call with S. Hotlettta apologizefar B. Bentley's actions and implore S. Holtett ~eprocess. payrotl and the chey~~es for etie week; coltwith Q. Gould re listing praposat terms and conditions;call with Bernie re 8. Henttey's actions and to discussthe proposed .agency arran~emene; dealing wikhfunding issues

Z4-Feb-1T Cerrato, Gary Review of correspondence re ~ui[ding assets and 'the 1.0removal of same; email to K. Pearl re same; emailcorrespondence with B. Ou[eete re various matters;dealing: with funding 'issues; call with J. Longlade revarious issues.

27-Feb-17 Cerrito; Gary Final review and execution of listing agreement; cat[ 1.3with V. Dane to discuss. his vicious concerns with the.administration; dealing with funding issues andresponcfin; to various emaiEs.

Z8-Feb-17 Cerrito, Gary t7raft email to Avaya re payment. of March 2417 rent; (}:$review of accounting and provide adjusting entries to.~:. BovaTr; follow up with Grant ~ Gabes re Februaryand March 2(}17 rent; responding to otE~er emai€s andfunding request issues..

1-Mar-17 Cerrito, Gary Calf _with Q. Pritchard re funciin~ issues and discuss 0.5other concerns; review of correspondence from J.Longlade,

2-hhar-17 Cerrito; Gary Call, Frith G. Parker re agency/management 2.0agreement and status of same and discuss #erms andconditions; email to C. Bovair re wire transferrequired and payment of professional fees; colt with:R. Jubenvitle and 5. Fink re status of the installationof the transformer; colt with loll Tress re ESA- issues;call with t~As: Peneda from local 'f 83 re possiblesettlement with V. McLean and discuss the filing of agrievance; review of .quote for annual fire inspection,

~, } _~^ _ .r


6-Mar-1Z Cerrato, Gary' Review of proposed letter from. 1, Brady. to Intact; 1.2contact Intact to follow up on insurance claim issues,;draft emaiE re same; ~orrespoi~dence: with J. Longlade.re NST filings and review-same; review of weekCy cashrequirements, tail with V. Dane r~ f~itact lecherdrafted by I. Brady.

7-Mar-17 Cerrato; Gary Review of funds reques~. 0:5

9-Mar-17 Cerrata, Gary C~tl with intact Insurance to try to negotiate 2.0additional cflverage €or business. interruption; callswith R. Jubenville and S. Fink to .a6tain costing faforward to insurer on tie balance of costs to installthe new transformer; dealing with funding issues;arrange for wire transfer; correspondence with V.Dane re accrapatian rent owing by receivers ofStratlicaria and bath PV; cat! with 5. Hotlett re agencyagreement and funding issues;: review ofcars'espondence frorti DW Goulcs re informationrequired on rent'rol[.

10-Mar-17 Gerrato, nary Call with R. Juben~ille re what is required to provide 1:4to the inst;rer,. review of corres~andence; call wift~ J..Longlade re. fundiri~ requirements for the followingweek; cieatin~ with insurance cEaim.

13-Mar-17 Cerrafo, .Gary halt with 5. Fink re informaeion required to send to i :Qinsureron insurance claim; ca11 to Talt Trees to. obtaininvoices and quotes to send to the insurer; draft emailre Intact funds received; discussion with J. Longladere funding requirements.

14-Mar-17 Cerrato; Gary beat with funding issues; review o€ correspondence re 0.7settlement with receivers of Strathcona foroccupation rent.

15-Mar-17 Cerrato, Gary Gall. with B. Pritchard re wire transfer and discuss 2.0pcopased settlement of occupa~ion rent with receiversfor Strathcona and Fath PV; revievd of correspondencereceived .from K. Hotlett re possible sale of 242'sassets by Receiver of Strati~cona; draftcorrespondence to Futter Landau; colt to Tall Trees reinvoicing and quotes re transformer replacement; ca[[witf~ V. ~aRe re occcspation rent setttement.

1 b-Mar-17 Lerrato, Gary Conference call with D. Gould ane~ prospective 1.{7purchaser to discuss recei~rership proceeding .andpossibEe offer for the property and assets ofStrathcona; review of email correspondence from V.Dane re possible theft of solar panels; deal withfunding requirements,

y~~i ~* 5< _#

Y~'

dale Professional. Description }-Ers:

20-Mar-17 CPrrato, Gary Cat( with t~. Gould re poCential of€er for property for d.5$1 :2 mit[ion or $1.{l cash and $5QOK vencor taS<e backinterest only mortgage:

21-hiar-17 Cerrato, Gary Call with Q. Pritchard re verbal offer received for the 0:8.real property; ca(i from I. Brady to discuss Verbal offerre~e~ved; review of corresponcien~e -from. !. Brady;review of correspondence from duller Landau toconfirm asset lists.

22-Mar-17 Cerrato;. -Gary Call 'with B. Pritchard and V. Dane to discuss -the (}..5verbal offer received for the property from D. Gould;deal with funding for fhe weep; revievr of emailcorrespondence- re removal of Strathcona asseCsreceived from K. ?cart.

22-Mar.-17 PritChat~d, Brian Discussion. with G. Cerrato re pocentiai offer; 0.6conference call with G: Cerrato and V: Date re email.from I. Brady; review information re time charges_;invoice to AYaya; email to 1. Brady.

z3-Mar-97 Cerrato, Gary Dealing with funding issues; utili~y issues with deposit; 0.8review draft minuees of seftter~ent prepared by V.I}aRe.

24-Mar-17 Cerrato, Gary Call with B. Otslette re utility deposits; review of Q. 5.correspondence re occupation rent settlement.

27-Mar-17 Cerratq, Gary review of .correspondence;' call with Veridian to d.5resolve disconnec~ notice issues and arrange forweekly billings.

28-Mar-17 Bone, Beth Ann Receipt, review, upload and fon+vard :of Notices of 0.5Assessment from CRA re GST!HST and RP.

29-Mar-17 Bone, Beth Ann Preparation of second invoice. d.5

29-Mar-17 Cerrato; Gary Review of CRA audit statements; draft email re d.8thoughts on impact of HST liability on SSPC; review'ofweeltly disbursemer~Cs.

29-Mar-17 Pritchard, Brian Discussion with Gary regarc~rn~ Cash Flow,, update on Q.$issues surrounding i~ a~isformer, review funds for 'Gasand Hydro; email from Jessica re payments; discussionwith Fiollett regarding management agreement.

30-Mar-17 Pritchard, Brian Fina( raview of settlement agreement with 5trathcona 0.2Receiver; execute agreement.

7

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pate Professional Rescciption Nrs,

5-Apr-17 Pritchard; Brian Emait to Cushman Wakefield' review rent receipts; ~.3call from CRA re Source Deductions; arrange wiretransfer.

6-Apr-17 Masciantonio, Katarina P3~one calf from V. Ghartt re WEPPA. 0.5

1 1-Apr-17 Cerrato, Gary Attend io correspondEnce received_ 0.5

T2-Apr-17 Cerrato, Gary Review and respond to K_ PearE re issues with asset d.7tests; review of weekly disbursemefits_

17-Apr-17 Cerrato, Gary Conference call with K. pearl and B. C}ue€fet re assets 1.0to be excluded from Steathcona/FaEh PV auction; callwith B. OUetlet re same.

18-Apr-17 Cerrato, Gary Cats with S. Bentley re iterr,s not identifiable on 1.5auction list; call with K. Pearl re Herman MiE(er chairs

_and other auction related matters.; conference cal.[with 'K. Pear(,. Danbury; B, Ouetfet Co discuss HermanMiller chairs and assets in Napanee; review ofcorrespondence received.

1.9-Apr-17 Pritchard, Brian, Email from_ Bernie; rel~iew email from Gould re 0.5potential.offer; discussion with G. Cerrato.

25-Apr-17 Cerrato, Gary conference call to discuss asseCs to be excluded from 0:.8Danbury auction far Strat€~cona with B. Ouell~t, V.bane, K: Pearl and J. Ordon and others; preparemonthly invoice for Avaya.

1-May-17 Bone,. Beth Ann Up(oad and forward tax does received in. C?shawa by 0.25Tax G'I~A:

1-May-17 Cecrato; Gary Calls with B. auellet to discuss proposal from Toronto 0.5CapitaE,• call with B. Pritchard re -same.

2-May-97 ~errato, Gary Conference call with B. Pritchard, B. Ouellet and I. 0:5Brady to discuss terra sheet ar~d moving forward witha C01 for the property; rail with I. Brady; call with D.Gould.

3-May-77 Pritchard, 6rian aiscuss;on with G. Cerrata re cf;er; emails to acid from Q.5.V. Dane re potential offer; review funds fcr winetransfer; follow up re Avaya ~~ent.

4-May-17 Pritchard, Brian Banking issues; oliow ~p with Avayz re rent; emails 0:3to V. Dane re invoice.

0

c~

Date ProfessionaE Description Hrs,

8-May-17 Cercato, Gary Follow up em.ai[ to Avaya re rent payment far May fl;52017; review of invoices to submit to insurer forinsEatlafion of transfflrmer and draft and forwarderrsail to.Bernie re same..

9-May-17 Cercato, Gary Review-and reconcile 6L; call with B, Pritchard re j.4sane; prepare and forward June 2017-rent invoice foAvaya; draft email r2 foElow up on collection of Avayarent; review and forward eE»ail re final invoicing tosubmit to insurer under the claim for replacing thetransformer; review of LEI terms- and condiCians.

10-May-17 Cerrato, Gary Cati witEi V: Dane re L01 terms; tail with B. Pritchard 0.6re same; respond to cc~rresponcenee received.

1 1-May-17 ~errato, Gary Review of L(?i terms; discussions_ with D. Gould re 1.6same; calLwit.h I. Brady; draft email to Avaya re rentalarrears; review of weekly disbursements.

i7-May-17 Cercato, Gary Conference call with V. Dane and B. Rr'itchard to U.3discuss LOl terms; tali iuith D. Gould.re L01 terms andissues.

1;9-May-17 Cerrato, Gary Call with Bernie ce offer and ot~ier issues.; call from I. 0.5Brady;. review of APS.

25-May-17 Cerrata, Gary Review of weekly disbursements; arrange for wire 0,5transfer.

29-May-17 Cerrato, Gary UpdatQ call with D. Gould re sale deVetopments; 0.5~tterad to corres~anctence received.

3{l-May-~7 Gerrato, Gary Review of funding request; assemble and send email 0:5to N. Prosty at Intact to provide final invoices- for theinstaltaeian of the transformer to be covered underthe company`s. insurance czaim.

1-Jun-17 Cerrato, Gary Review of APS and execute; discussions with- L Brady; ~.1call with D. Gould; sign' and return co-op agreement;review of c3isbursemerts, respond to emailcorrespondence.

8-Jinn-77 Cerrato, Gary Revievr of weekCy Cis~urseri3ents; arran,e for wire 0.8transfer for week; prepare. invoice Avaya July 207i~Vpice; review of condition summary report preparedby QWG.

8-Jun-17 Montesano, Tciny Take request for wire transfer to bank far processing. D.4

9•Jun-i7 1~Aontesano, Tony- Process cheques_ d.2

9.

3 r~~~ y.• p

~.~_


12-Jun-1.7 Cerrato, Gary Review of correspondence receivea from L Grady; 0.5review. financial information provided by praspe~tive:p~rrchaser; conference cat[ with B. Pritchard and V,Dane to discuss next steps to proceed with sale of teatproperty,

12-Jun-'I 7- Pritchard; Brian Discussion with G. Cerrato and V. Dane re financial 0:3strength of the potential purchaser;. reviewAgreement of Purchase .and Sale.

13-Jun-T7 Cerrato, Gait' Review .of correspondence received;. Eotlow up with 0.5insurer; review of General Ledges:

99-Jun-17 Bone, BeEh Anti Receipt, scan and send tax correspondence for estate. 0.2~

29-Jun-17 Cerrata, Gary Review and execute amending agreement; review of Q.5weekly disbu[sements.

2b-Juiz-17 Pritchard, Brian Discussion with BRA re ITC's -and reCurn information. 0.3

29-Jun-17` Cerrato, Gary Rev:ew of carrespQndenee received; call- from I: 0.3Grady; email to I Srady.

12-Jut-17 Pritcf3ard, Brian Call to 1. Brady; email to 1. Brady; c#iscussion with G. 0.8Cerrato re closing; discussion with 1!. DaR~ re issueson c€osing; property taxes; review bank'recar~citiatiors; review payments deposited to.receivers account.

13-Jtil-17 Cerrato, Gary Calf to Bernie and Jerry to discuss APS issues and 0.3accounting.

14-Jul-17 Ger~ato, Gary Review of accour~ting; discussions with B: Pritci~ard re 3.5same; call with i. Brady; call with V. Dane; prepare~2~tD and SER; calf with J. Lorialade; ca[[ with Rntact reinsurance claim; provide additional information resame.

14-Jul-17 Pritchard,, Brian Call .from 1. Brady; email . eo V. Dane, review issues 1:3re~ardrrig sale; discussion with G. CerratQ re sate;accounting in ;elation to closing;. discussion with G.Bouair re posting of transactions, and rent receipt.

17-Ju(-~7 Cerrato, Gary discussions ~vitl~ J: Longlade re estimated future 3.0costs; update schedule of estimated recovery; callwith I. Brady; call with V. [)aRe to discuss APS termsand conditions.

17-.lut-17 Marchand, Matthew Gorrespondence.with G. Cep rato re property taxes and 0.3commission on sale of building.

Z4

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- ~~ .~~r

Date Rrofessional Descr►pEion

17-Jut-17 Pritcf~ard, Brian Lengtf~y discussion with G: Cerraro regarding R~xD,Expenses, Gotitd ~nvaice and ~iST; discussicn withJessica; reV.iev;+ estimated realization 5chedute;discussion with B. Bone re. HST refund.

1&Jul-17 ~errato, Gary ~anferen~e. ca~I wiCh V.. QaRe and ~. Pritchard todiscuss proposed sate accounting;. issues with APSamendments and strate~ize in general on sale closing;conference call with B. Pritchard. aid V. Dane; callswith B. Pritchard;_ conference call with V. Dane, B.Pritchard and l: Brady; review of ~or'respondencereceived re proposed A['S terms.

18-Jul-17 Pritchard, Bfian Conference. colt with G. Cerrato and V. Dane; .discussAPS; review payout issues; review material from V.DaRe;. review agreement; discussion - with I: Srady;,review mork~age issues; review accounting..

2Q-Jul-~7 Cerrato, Gary Reyiew Agreement of Purchase and .Safe; call with B.Pritchard re lien, mortgage and pcsitian of Gould inrelation to the mortgage and other issues; review of.correspondence.

20-Jul•97 Pritchard, Brran Review agreement of Purchase and Sale; discussionwith .G. Cerrato re Lien; discussion re r;iartgage andposition of Gould in relation to the mortgage; discussprescribed security agreement; review accounted.

25-Jul-17 Cerrato, Gary D.raffiing court cepoi~t.

25-Jul-17 Pritchard, Arian Conference c.alL with G. CerraGo, V. €?aRe and I. Beadyre of€er, deposit. and report,• review material from V.Dane in preparation of Report.

26-Jul-17 Cerrato, Gary Review of motion Cecord; review of factum; call withV. €~aRe re carious issues; draft;no court report.

Hrs.

i~i7

z.a

z.z

0;8

0.8

2.5

0.3

4.5

11

to

Court Pile No. CV-16-11565-OOCL

ONTARIOSUPL~RIOR COURT OF JUSTICE

(COMMERCIAL LIST}

BETWEEN:

SIDNEY STR~~T PROPF,I2TII;S CORP.

Applicant

- and-

24280 9 ONTARIO INC.

Respondent

AFFI.DAVIT OF JARED SCHWARTZSWORN JULY 25, 2017

I, Tared Schwartz, of the City of Toronto, Province of Ontario, Barrister and

Solicitor, MAKE OATf-I AND SAY AS FOLLO~,~S:

I. I am a lawyer with the law firm of Foglcr, Rubinoff LLP ("FR"), lawyers for-

BDO Canada Limited, in its capacity as Receiver of the Respondent (the

"Receiver"), and as such have knowledge of the matters hereinafter deposed to.

2. Attached hereto as Exhibit "A" is a true co~~y of the interim account dated

Febr~llary 23, 2017, rendered from the period of Ja~~uaxy 29, 2017 to February 22,

2017 by PR to the Keceiver, which account secs out the particulars o:f the work

performed by T'R with respect to this matter.

3. Attached IZereto as Exhibit "B" is a true copy of the interim account dated March

13, 2017; rendered from the period of Octobe~~ 27, 2016 to November 8, 201 C by

F'R to the Receiver, which account sets otit tl~c pa~•ticul~rs of the work performed

by FR with respect to this matter.

4. Attached hereto as Exhibit "C" is a -true copy of the interim account dated March

27, 2017, rendered fi-orn the peziod of February 24, 2017 to March 23, 2017 by

FR to the Receiver, which account sets nut the particulars of the work performed

by FR with respect to this matter.

5. Attached hereto as Exhibit "D" is a true copy of the interim account dated April

2~, 2017, rendered from the pet~iod of March 28, 2017 to April 19, 2017 by TR to

the Receiver, which account sets out t11e particulars of the work performed by FR

with respect to this natter.

6. Attached hereto as Exhibit "L" is a true copy of the interim account dated May 23,

2017, rendered from the period of April 25, 2017 to May 19, 2017 by FR to the

Receiver, wI7ich account sets out the particulars of the work performed by FR

with respect to this matter.

7. Attached hereto as Exhibit "F" is a true copy of the iiaterim account dated June 23,

2017, rendered from the period of May 31, 2017 to June 21, 2017 by PR to the

Receiver, which account sets out the particulars of the work performed by FR

with respect to this mattez-.

8. Tile total of the interim fees, disbursei~lents and applicable taxes from October 27,

2016 to June 21, 2017 is the sum of $73,331.57. The said accounts by F'R to the

Receiver are summarized as follows:

Date Tees Disbursements

~

HST Total

Pebruar 23, 2017Y X22,259.00 $951.83 ~ $2,996.61 $26,207.44

March 13, 2017 $8,632.00 $639.73 ~ $1,205.32 $10,477.05

March 27, 2017 $13,185.00 $211.60i~ $1,7 1.56 n15,138.16

April 24, 2017 $5,618.00 $0.00 $730.>4 X6,348.34

May 23, 2017 $4,823.00 $0.00 $b26.99 $5,449.99

June 23, 2017 $8,533.00 $60.45 $1,117.14 $9,710.59

Total $63,050.00 $1,863.61 ì~8.417.96 $73,331.57

9. The following are the billing rates of the lawyers who have worked upon the

matter as of July 25, 2017, together with their year of call.

Timciceeper Hourly Rate 1'e~li• af~ C:~II

Vern W. Dane $520.00 (2Q16)$530.04 (2017)

1991

Martine S.W. Garland $324.00 (2017) 2014

10. The hourly billing rates applied are FR's normal hourly rates for this client.

SWORN before me at the City of)Toronto, in the Province of Ontario, this )25t~' day of July, 2017. }

~ --~-' )

`,~ .~

A Commissioner, et .

~ ~ ~ ~~~~.

_,.. _.

P~' JA~2ED S+c'~ WA_~~.` `.,.

This is Exhibit "A" referred to in tl~e Affidavit of Jared Schwartz sworn

before me this 25 f' day of July, 2017

r:'i'

t~~~~ ~~A Commissioner for taking affidavits, etc.

February 23, 2017

I3D0 Canada Limited419 King Street West, Suite 502Oshawa Executive CentreOshawa ONL 1 J 2K5~t~tentio~l: Bria~l Pritchard

Principal, Senior Vice President,"[~rustee

1N ACCOUNT WIT}1Fogler, Rubinoff LLP

77 King Street West, Suite 3000TD Centre North Tower

P.O. Box 95Toronto, ON

M5K 1 G8Tetephone:416-864-9700

Fax: 416-941-8852www. foglers. com

_ _ _ __ _ ___ __ __ ____ _ __o~~,• r>>~: 132~1~ i l~~aa~

Recei~t>ership of 2428049 Ontario Inc.

TO ALL PROFESSIONAL S~I2VICI~S REND~R~D in connection with the above noted matter,inclucli~l~:

Date Lawyer Description Hrs

Jan-29-17 V WD Review BDC's appointment letter of insi Spergel; emai is to and 2.40from Gary Cerrato regarding cira~t~t Receiver's Report; t7nalizeNotice of Motion, draft Order and Factum.

Jan-30-77 VWD Telephone conversations will Gary Cerrato and Brian Pritchard of 3.70BDO regarding draft Receiver's Report; review drafts of same andpropose revisions; finalize motion materials including draft Order,Factum and Book of Autho3~ities.

Jan-30-17 MG Review and revise Fee Affic(avit; DiscE~ssion with Vern Dane. 0,40J~»-31-17 VSI~ Commercial motio~l, ractum, briefs. 0.60Jan-31-17 VWD Review emails f~egarding Avaya rent. 0.20Jail-31-17 VWD C-mails fro~1~ Philip Geniis, Michael Brze~inski a~ld Gary CerraCo 0.40

and reply to same.1~'eb-01-17 VWD Telephone conversation with Gary Cerrato reviewing Lease and 1.00

Avaya's reconciliation stateme~It; review Lease and l~vaya'sreconciliation statement.

1=eb-02-17 VWD Review email from Patel McCulloch aT the MOECC and reply to 0.20same.

Feb-02-17 VWD "I~elepl~one conversation with Greg Parker, counsel for Sidney. 020I~eb-03-17 VWD Review E3D0's revisions to Avava's Rent Reconciliation Statement 0.50

and .Ianuary and February i~eiltal invoices; review email fi~on~ GaryCerrato to Kent Beattie and Mr. I3eattie's reply email.

Feb-03-17 VWD Review en~iail from Kent Beattie, Avaya's lawyer, with revised 0.20reconciliation stat~enient attached.

Feb-06-] 7 V WD Review email from and to /1v~ya's counsel, Kent Beattie, regal~din~ 0.30reconciliation of rent.

Teb-06-17 VWD "I,elephone message from Frai~l< Spizzirri; reply to same; email from 0.30~'I'~lilk S~1ZGI1'f'1.

Feb-06-17 VWD Review BDO invoices to Avaya for re~1t for months of January anti 0.301=ebruaty as revised; review ernails regaeding same

fogler

Date Lawyer Description Firs

Feb-07-17 VWD Telephone conversation wit11 Greg Parl<e~; en~ails from end to Mr. 1.20Parker, Gary Cerrato and Sidney Street.

I~eb-08-17 VWD Review Motion Record, Factum and Bool< of Authorities for 3.30Receiver`s motion rettir~nable tomorrow; revise di~ait Order; em~ilsand telephone calls dealir7g with same.

Peb-Obi-1? VWll Review letter from Avaya's la~vyei; review Av~iya's Notice of 0.70Default of Lease; review relevant provisions of the Lease; listen tovoice-mail message from Kent F3eattie, counsel for Avaya; emailexchanges with Kent Beattie and client regarding sane.

Feb-08-17 VWD Telephone message from Michael Brezinsky, counsel fo~~ Miller 0.50Landau, rc;~ardinb scheduling motion date; email to same and othercou~~sel regarding same; emails from RBC's counsel and reply Cosa~i~e.

1~'eb-09-17 VWD Preparation for today's motion by reviewing Motion Record, 4.30Factum and Book of Alitlloritics; emails aid telepho~leconversations with client; attend Court and appear before .iusticeHainey; email to client and Service LisC regarding sa~1~e.

Peb-09-17 VWD Review Listing Agreement from llerelc Gould and emails from 0.70client and Sidney's counsel regarding same.

Peb-69-17 VWD Telephone conversation with Brian Pritchard and email exchanges 0.60with client regarding Avaya; email exchanges with Sidney Streetand its counsel regarding Ava.ya's Notice of Defa~ilt.

Feb-10-] 7 VWD ~-mails to and from Kent Beattie regardi~~g the timing of the 0.40~ay~nent of rent by Avaya; ei~~ails to client regai•di11~ same.

Teb-13-17 VWD Review I~lsurance policy over- the I3ellevilie Property; review 2.20Veridian and Union Gas demands; review the security position ofRCAF regarding equipment including glass office.

Teb-14-17 VWD Review and reply to email from Jeffi~ey Kroeker~, cou»sel foi- debtor; 0.50review and reply to email from "Pony O'Brien, colnlsel for BDC,regarding issue oTpost-receivership occupation rent; e~i~ail to clie~it.

Feb-l4-] 7 VWD Review emails fiom Bernie Oulette at Sidney Street and t~eply to 0.60same; email to Kent Beattie regarding Default Notice; email toclient regarding same.

Teb-14-17 VWD Review emails from client, Ken I<allisl~, Derel: Gould, Bernie 1.60Oulette ~i~d Kent Beattie regarding occupation rent at the Avayapremises and Stratl~cona premises; reply to same; revie~~ Avayalease.

Feb-15-17 VWD Review Motion Record of Monitor and Canadian Debtor's to 3.20~x~~edite and for Directions from Ontario Count of Appealregarding appeal of approved or sanctioned Plan in the NortelCCAA proceedings; lenbthy "without prejudice" eillail to counselfor other receivers in an attempt to settle occupation rent issue at theSt.ratl~co~~a/Path leased premises; research law on set-off be~1'oresending the email.

Feb-15-17 VWD Revie«~ email from Bernie at Sidney Street regarding the status of 0.20correcting alleged defaults set out ii1 Avaya's Notice of Default.

f~'eb-16-17 VWD Review leti~er from "[~ony O'Brien, counsel for BDC; reply to leTtei-; 2.20email to client i~egardiilg sa~r~e; review draft Listing Agreementswith D.W'. Go~~ld Realty; propose revisions to same aild email toclient regarding same; emails from client regarding same.

Page 2 01'4

fogler

llate La~vyet. Description I~I~s

Peb-16-17 VWD Telepl~oi~e~ conversatio» with Gary Cerrato regarding Avaya lease; 0.60brief review of deposit provisions of the Avaya lease.

reb-17-17 VWD Tetephone~ conve7satiorl with Gary Cerrato of BDO; email exchange 0.40with same.

Teb-17-17 VWD Coilfei•ence call with Bria~l Pi~itch~rd and Gary Ce~•rato regardi~lg 0.60draft Listi»~ l~greement; review paragraph 10 of Schedule A ofListing Abreement.

F'eb-21-17 VWD Review Payment of Commission (sale) clause in proposed Listing 2.30Agreement with Gould; disctass same with our real estate clerk;review case la~u dealing with coiivnissions based on pre-redlictio~lsale price; propose revisions Yo same; email to client; read emailfrom Bernie Oulette; ei~~ail to client regardizlg l-~vaya rent.

Feb-21-] 7 VWD Review emails from Gt-eg Parker and reply to sane. 0.30I~eb-21-17 VWD Review ema.ils from client and Sidney Street regarding rlvaya rent ?.30

and the agency agreement; review e~nails from client eegarciingdraft Listing Agreenlenf; review Appeal court documents in theNortel proceedings.

l~eb-22-17 VWD E-mail exchanges with James MacLellan of E3LG; email to client 0.30regarding same.

Feb-22-17 VWD Telephone convei~satioii with Greg Parker oi' Sidney Street. 0.30I~eb-22-17 VWD Review draft Agency Ageeement and propose revisions to same; 2.30

review emails from Sidney Stt•eet and its counsel i•egardirlg smile;emails to a~ld fi-o~n clie~~t regarding di~aff Listi~lg Agreement;telephone conversation with Brian Pritchard at BDO; review emaiIsfi-om Monitors eoui~sel in the Nortel proceedings and attachedcorrespondence regarding the appeal to the Ontario Court ofAppeal.

Feb-22-17 VWD Re~~iew the revised draft Agency Agreement and comment o» same; 0.40email to Sidney Street's lawyer and client r~egardii~g same.

OUR P~I+~ I-IERrIN X22,259.00

UIS~JU1'SCII1CI1tS

T~axablc I3indi»g Supplies $31.10

Lxempt File Notice of Motio~l/Ap~~lication `6160.00

"I~'axable Prints $475.50

"T'alab(e Qliicklaw On-li~7e Computer Searches `~=1.00

'~Caxable Scanning `~ 188.25

"T~a~able Telephone $45.98

"I~axable Westlaw O»-line Computer Searches $47.00

"I,o2a1 Disbw-semcnts X951.83

Total Pees ai d Disbursements $23,210.83

HSÌ, @ l 3% nn Pees aild Taxable Disb~nsements $2,996.61

Total Tees, Disbursements and Taxes this 13111 b26,207.44

Page 3 of 4

fog~er

Balance Due: $26,207.44

THIS IS OtiR ACCOUNT HEREINFOGLER, RUBINOFF LLP

~\ 1({ {

f t t '...

Vcr~n W. I)aRe

"CHIS ACCOUNT' E3L'ARS INTEREST, COMMI:NC[NG ONE MONTH AFT'GRDELIVERY, AT 7'EiE RA"1'Ci OP 330% PER ANNUM AS AUTHORI2LD 6YTHE SOLICITORS' AC'I. ANY DISBURSEMENTS NOT POSTED TO YOURACCOUNT ON THF, DATE OF THfS S'TAT'EMENT W[LL BE 61LLLDLATER.

E. & O.C. GS"(7HST' No : R1194Z08,59Please relnrn n copy oJ~his ncc~»rnr with ynxr paymrnL ~hnnk you.

Page 4 of 4

This is Exhibit "B" referred to in the Affidavit of Jared Schwartz sworn

before me this 25t~' day of July, 2017

1 ~

A Commissioner for taking affidavits, etc.

Invoice Nunn: 21703470

March 13, ?017

BDO C~inada Lii~liied419 Icing Street West, Suite 50?Oshawa F:,xecutive CenireOsha~a~a ONL1J 2IC5Attentio~~: E3eian Pritchard

Principal, Scrlior Vice President,"1~rustee

IN ACCOUN"[' ~VI'1'liFogler, Rubinoff LLP


P.O. Qox 95Toronto, ON

M5K 1 GHTelephone:416-864-9700

Fax: 416-941-8852wwv✓.foglers.com

Ou►• File: I32816 / 166407Receivership of 2428049 Ontario Inc.

TO ALIT PROFrSSTONAL SERVICES RENll~REll in connection with the above noted m~itt~cr,including:

Date Lati~~ver llescription Ilrs

Oct-27-16 VWD Rc;vie~u email fiom Paul McCulloch, counsel for MOECC, setting 2.30out the Ministry's position; review relevant sections of the ~;I'A andBIA i~egai-di»g e»vironmenCa] obligations; lengthy email Yo clie~ltregarding same; conference call ~.vitl7 Ia~l Bi~aciy, coLinsel f'orApplicant, i•egai•ding same.

Oct-27-16 VWD Telephone coni'erence call with Gary Cerrato and I3i~ian Pritchard. 0.~0Oct-28-16 VWD Revise draft Order appointi~~g the Receiver with sever~il sigiliticant x.40

revisions limiting the scope of the receivership; emails to clientregarding same; review and consider case law under section1 4.06(7) oi~the BIA de~li»g ~~~itl~ the priority of environmentalclaims; draft Indmenity Agreeii~ent; email to client.

Oct-31-IC VWD 'Telephone conversation with tan Brady regarding; draft Order and 0.4~Indemnity Agreement.

Nov-01-16 VWD Revise draft Receivership Order as per proposed changes suggested 320by Iai~ Brady, counsel for Sidney Street, and BDO; email to same;further discussions and email exchanges reg~u•cjing sane.

Nov-01-16 VWD `['elephone conversation with I{en I<allish, counsel for RISC; 0. 10telephone co»versatioi~ with Brian Pritchard.

Nov-02-16 VWll L-mail to Service List attaching revised draft receivership order and 0.30in the message generally dese~~ibing the nature of t~h~ proposedrevisions.

Nov-02-16 VWD Review and eeply to emails from counsel for the MOGCC end the 0.70Monitor in the Nortel CCAA proceedings.

Nov-02-16 VWD Telephone conversation ~~~itl~ I3rian I'ritch~rd regarding draft 0.20receivership ot~der.

Nov-03-16 VWD Re-vise draft receivership order as per client's instructions and email U.60from Chris Ar~z~stro~2g aY Goodi~~ai~s, coiu~sel for Monitor inNorTel's CCn~ proceedings.

fogler~. ,,.~u;;~aff

Date La~vver Description H,~rs

Nov-03-16 VWD Telepf~one conve2•sation with Ian Brady; read email from Chris 0.20Armstrong.

Nov-04-16 VWD Review Notice of Appearance and letter• from counsel of the City of 0.20Belleville.

Nov-04-16 VWD Review emails from lawyer for the City of Belleville; te]ephone 1.20conversation with Ian Brady; review draft letter requestingadjourmnent and propose changes to same; email to Service Listand Commercial List z•egai•ding same.

Nov-07-16 VWD Review emails fi-o~~i Ian Brady and Ken Kaliish regarding RBC's 0.50receivership application; reply to sane; telephone conversationwith Ian Brady; email to Court regarding the requestedadjournment.

Nov-08-16 VWD Attend Court today before Justice Penny; email to Service List 0.50regarding same.

OUR FEE HEREIN ~8,G32.00

Disbursements

Taxable Binding Supplies

Taxable Courier & Delivery

Taxable Faxes

Taxable Prints

Taxable Scanning

$42,50

$91.53

$3.95

$381.00

$120.75

'Total Disbursements

Total Fees and Disbursements

HST @ 13% on Fees and Taxable Disbursements

Total Fees, Disbursements and Taxes this Bifl

Balance Due:

$639.73

$9,271.73

$1,205.32

$10,477.05

S 10,d77.QS

THIS IS OUR ACCOUNT HEREIN THIS ACCOUNT BEARS IN"I'EREST, COMMGNCINO ONE MON"fFI AFTERDELIVERY, AT TI-1E RATE OF 330% PER ANNUM AS AUTHORIZED I3Y

FOGLER, RUBINOFF LLI' THE SOI.]CITORS' ACT. ANY DISBURSF:ML•NTS LAOT POSTED "f0 YOURACCOUNT ON THE DATL OF T}1fS STATGMEN'1' \41LL l3L' f31LLGU

t~'~ LATER.i ~ ~~

p '+ ~ E. & O.E. GST/f IST No : RI 19J2(ISS9~~t ~\ + ~~~ ~ ~~ Pleu.re relurn a copy gJdrir ucenruu N~i~h ynur pr~r~nein. 7huuk mu.

u

Vcrn W. UaRe

Page 2 of 2

This is Exhibit "L" i•eferrecl to in the Affidavit of Jared Schwartz sworn

bc;forc me this 25`'' day of July, 2017

I

\ i

-_..__-1 -__-

A Commissioner for taking affidavits, ctc.

Maz~ch 27, 2017

BDO Canada Limited4I9 King Street West, Suite 502Oshawa Executive CentreOshawa ONI.,1J 2K5Attention: Bria~1 Pritchard

Principal, Senior Vice President,Trustee

IN ACCOUNT WITIjFouler, Rubinoff LLP



M5K 1G8Telephone:416-864-9700

Fax: 416-941-$852www.fogters.com

f~ l r .Onr File: 132816 / 16G407

Receivel•ship of 242804) Ontario Inc.

TO OUR rE~ HI;RCIN IjOR ALL PROFESSIONAL SERVICES R~ND~RED on your behalf inconnection with the subject matter, covering the period between February 24, 2017 and March 23, 2017,including: to all necessary drafting of documents, attendances, correspondence and telephoneconveT•satioils, a~ld to the following:

Date La~v ei• Description Hrs

Feb-24-17 VWD Review proposed revision to Listing Agreement regarding 0.30commission and comment on same; email to client.

Feb-24-17 VWT~ Re~~iew emails from Gary Cert•ato and Ken Pearl regarding list of 0.30equipment or assets allegedly belonging to 242.

Feb-27-17 V WD Review final drafts of Listing Agreements; emails to and fi-om Gary ] .40Cerrato regaz-ding same; telepl~olie conversation with Gary Ce1~r~ato.

Feb-28-17 VWD Telephone conversations with Greg Parker, counsel for Sidney; 0.60emails to and from client regarding Avaya rent.

Mar-02-] 7 V WD Review Motion IZecoi•d of Puller Landau for motion retui-ilable 2.20March 9, 2017; email to client regarding same; email to TonyO'Brien and others regarding occupancy rent; email to MartineGarland setting out issues regarding occupa►~cy rent.

Mir-02-17 MG Discussion with Vern Dane; Re;vie~~ recent correspo~ldence acid 2.30documents; Review caselaw on occupation rent.

Mar-U3-17 VWD Telephone conversation with Brian Pritchard. 0.20Mar-04-17 VWD Review draft Agency Agreement and propose revisions to same; l .?0

email from and to client and lari Brady.Mar-06-17 VWD Telephone conversation with fan Brady and Greg Parker regarding 0.34

draft Agei7cy Agreement; review latest draft; emails from clie~itregai-dinb same.

Mar-06-17 V WD Review draft letter to Intact and propose revisions to same; email to 0.40client a~ld fan Brady eegardiilg sane.

Mar-06-17 MG Review motion records and ap~~lication records; Research on legal 0.80issues for motion regarding occupation 1•ent and set-off.

fogler r

Date Lawyer• Description Hr•s

Mai•-07-17 MG Discussion with Vern Dane regarding Text steps and file strategy; 3.50Researc(~ on occupation rent and set-off; Review mor7itor reportsand previous orders; Prepare reporting email to Vern Dane withsummary of law and legal issues for motion.

Mar-08-17 VWD Telepho~ze conversation with Michael Bi-zenzinski, counsel for 0.20Fuller Landau, regarding his client's motion tomorrow and theoccupzncy/storabe rent issue.

Mar-08-17 MG Prepare Notice of Motion and further• review of court documents; 1.50Discussion with Vei71 Dane.

Mai•-09-17 VWD Review emails from client and reply to same. 0.60Mar-09-17 MG Discussion with Vern Dane regat•ding motion. 0.10Mar-10-17 VWD Review and propose revisions to draft Confide~ltia.lity Agreeme~lt. 0.60Mar-10-17 VWD Telephone voice-mail exchanges with Michael Beezinski, counsel 0.30

for Fuller Landau; email to client regarding same.Mar-13-17 VWD Telepho~le conversation with Michael Brezinski, counsel foi• Tuller 0.30

Landau regat~din~ the occupation issue; email to client regat~dingsame.

Mar-14-17 VWD E-mail exchanges with Michael Brezinski, cowlsel for Fuller• 0.60Landau, and client regarding settling occupation/storage issueregarding motion returnable April 5, 2017; discuss same withMartine Garland of our office.

Mar-15-17 VWD Review settle~ner~t offer from the other side regardi~~g the 1.30occupation/storage rent issue; email exchanges with clientregarding same; email exchanges with Sidney Street's lawyer; emailto Michael Brezinski, counsel for Fuller Landau.

May--15-17 VWD Telephone conversations with Ian 13racly; emails to client regarding 0.40settlement offer.

Maj~-15-17 VWD Discussion with Gacy Cerrato regarding terms of settlement 1.70regarding the occupation rent/storage issue; emails to and fromMichael Brezinski regarding same; review and reply to variouse~nails from client regarding removal of certai~l assets from thepremises.

Mar-1 5-17 V WD Review letter from Ms. Armstrong of Lerners on behalf of Jay Parry 0.50Enterprises regarding the alleged theft of solar panels from theprei~~ises; reply to the letter; email to client regarding same.

Mar-15-17 MG Discussio~l with Vet•n Dane regai•di~ig settleme~it. 0.20Mar-16-17 MG Discussion with Vern Dane regarding settlement. 0.10Mar-17-17 VWD Telephone conversation with Michael Brzeninski t•egarding terns 1.10

of the settlement and Minutes of Settlement 1•egardi~lg the storage oroccupation rent issue; email to client regarding same; consideradditional terms being proposed by Mr'. Brzeninski.

Mar-21-17 VWD Review email from Ian Brady regarding potential offer; email to 0.30client regarding same.

Mar-22-17 VWD Conference call with Brian Pritchard and Gary CeT-rato; c~eview 1.20client's draft response to email fi•om Iat~ Brady regarding potentialoffer and costs; propose revisions to sane.

Page 2 of 3

fogter~~~a~

D Lawyer Description

Mar-23-17 V WD Review emails from client t•egarding Veridian's threat todiscontinue services; reveiw Veridian letter; review relevantsections of Receivership Order and case law dealing with thetreatment of security deposits in receiverships; email to clientregarding same.

Mar-23-17 V WD Review and revise draft Minutes of Settlement; email to MichaelBreznski regarding same; email to client.

Mar-23-17 MG Prepare Minutes of Settlement; Email correspodnence with VernDane.

OIJR T'F;~+; ~IT',RF,TN

Disbursements

Taxable Faxes $3.35

Taxable Prints $117.Q0Taxable Scanning $76.25'taxable Westlaw On-line Computer Searches $15.00

Total Disbursements

Total Fees and Disbursements

HST @ 13% on Fees acid Taxable Disbursements

Total Fees, Disbursements and Taxes this Bill

I3alance Due: X15,138.16

THIS IS OUR ACCOUNT HF,RI',IN THIS ACCOUNT [SEARS 1NTGRES'C, COMMENCING ONB MON'1'Ii APTGRDELIVERY, AT THE RATE OF 3.30% PER ANNUM AS AUI'HORIIED BY

FOGLER, RUl3INOFF LLP TIIESOLICI"PORS'ACT. ANYDISBURSEMLNTSN01'POSTED "CO YOURACCOUNT ON THE llATE OF THIS S'I'ATEMEN"I' WILL HE t31I,LEDLATER.

~ ~ ~~ E. & U.E. GST/lIS"P No : K119420859(~` j (~ (~ \ ~ Ytca.ce retrn~n n copy ojdris nccoun~ with yoin~ payment. thank ynu.1 I~1v~,

VCI'il W. D211ZC.

1.60

1.30

l .40

~13,18S.Ot)

$211.60

$13,396.60

$1,741.56

$ l 5,13 S. l 6

Page 3 of 3

This is Exhibit "D" referred to in the Affidavit of Jared Schwartz sworn

before me this 25t}' day of July, 2017

__ 1\~~ . __.._~

A Commissioner- for taking affidavits, etc.

Invoice Num: 21705621

Apri124, 2417

13D0 Canada Limited419 King Street West, Suite SQ2Oshawa Executive CentreOshawa ONLIJ 2K5Attention: Brian Pritchard


IN ACCOUNT WITHFogler, Rubinoff LLP



M5K 1 G8Telephone: 416-864-9700

Fax: 416-941-8852www.foglers.com

f~ ~~rOur• File: B281b / 166407

Receivership of 2428049 Ontario Inc.

[<OR PROFESSIONAL SERVICES RENDERED in connection with the above-noted matter fromivlat~ch 28, 2017 to April 19, 2017, including:

Date Lawyer Description H_rs

Mar-28-17 VWD Review revisions to draft Minutes of Settlement made or proposed 0.60by counsel for the other parties to the Minutes of Settlement.

Mar-30-17 VWD Review CRA claims regarding outstanding source deductions and 1 .7(?HST and emails from Gary Cerrato and Bernie at Sidney Streetregarding same; review emails from Michael Brzezinski regardingdraft Minutes of Settlement regarding Motion returnable April 5,2017 concerning occupation rent or storage costs; review andpropose revisions to latest draft of Minutes.

Mar-30-17 VWD Telephone and email communications with Fuller Landau's lawyer ~. i0regarding status of execution of Minutes of Settlement.

Mar-31-17 V W'D Review email from client regarding HST; email to client providing 0.30update regarding status of Minutes of Settlement concerningoccupation rent/storage issue.

Apr-03-17 VWD Telephone conversation and email exchange with Toni Apa at 0.30Lipman Zener Waxman law firm regarding execution of Minutes ofSettlement by their clients.

Apr-03-17 V WD E-mails to and from BDC's lawyer, Ian Klaiman, regarding Minutes O.E>Uof Settlement; review fully signed Minutes.

Apr-U4-17 VWD E-mail to Commercial List requesting the dismissal ofBDO's 0.20motion returnable tomorrow regarding occupation rent or storagecosts.

Apr-04-17 VWD E-mail to and from Brian Pritchard at BDO regarding tomorrow's 0.3Umotion and status of rent payments.

Apr-OS-17 VWD Review email from client and reply to same regarding status of 0.~0Avaya rental payment.

fogler~ €Date I,aovver Description I„~

npr- I I -17 V W"D Review Motion Record of The Fuller Landau Group Inc., as 1.10receiver of Strathcona and Fath, for motion returnable April 19,2017; email to client regarding same; review email from Ian Bradyregarding status of rent payment by Avaya.

Apr-12-17 VWD Review email from Ken Pearl regarding sold items. 0.20Apr-17-17 VWD Review and reply to emails from Ken Pearl regarding certain Miller 0.60

Herman chairs; conference calf regarding same.Apr-17-17 VWD Review Intercompany leases; review Liquidation Sales Agl•eement 2.30

and Listing of sold equipment; emails to cliezit regarding same.Apr-18-17 VWD Review BDC responding affidavit to Fuller Landau motion 1.30

returnable tomorrow regarding approval of liquidation of assets;review draft orders regarding liquidation of assets and approval ofFuller Landau's feea and activities in the Strathcona receivershipproceedings; review and reply to emails from Ken Pearl regardingsale of Herman Miller Chairs.

Ape-19-17 VWD Review PPSA Notice of Sale issued by BDC; review emails from O.60Ken Pearl regarding status of Herman chairs; review issued Ordersin the Strathcona proceedings.

011R FEE HEREIN ~5,G18.00

Disbifrsemeuis

Total Disbursements $0.00

Total Fees and Disbursements $5,618.00

HST @ 13% on Fees and Taxable Disbursements $730.34

Tota! Fees, Disbursements and Taxes this Bill $6,348.34

Balance Due: $6,348.34

THIS IS OUR. ACCOUNT HEREIN THIS ACCOUNT BEARS INTEREST, COMMENCING ONE MONTH AFTERDELI VERY, AT TFiE RATE OF 330°/ PER ANNUM AS AU'I'I IORIZFD DY

FOGLER, RL'BINOFF LLP THE SOLICITORS' ACT. ANY DISBURSEMENTS NOT POSTED TO YOURACCOUNT ON THL DATE OF THIS STATEMENT WILL QE t31LLEULATER.

~ ,~ (~ " E. & O.E. GST/FIST Nn : R119420859ti ~ Please return a copy of ~hts account with yoar payment. T hank you.

Vei•a~ ~V. ~alZe

Page 2 of 2

This is Exhibit "E" referred to in the Affidavit of Jared Schwartz sworn

before me this 25`'' day of July, 2017

~

.


May 23, 2017

BDO Canada Limited419 King Street West, Suite 502OsI~awa Executive CentreOshawa ONL1J 2K5Attention: Brian Pt~itchard


Our• File: I32816 / 166407I2eceive~•ship of 2428049 Ontat•io Inc.

IN ACCOUNT ~~~ITI-IFogler, Rubinoff LLP



M5K 1G8Telephone: 416-864-9700

Fax: 416-941-8852www.foglers.com

T'O OUR FEE HEREIN I'OR ALL PROFESSIONAL SEKVICES RENDI:RGll on your behalf inconnection with the subject matter, covering the period between April 25, 2017 and May 19, 2017,including: to all necessary drafting of docume~~ts, attendances, correspondence and tale}~hoi~econversations; and to the following:

Date Lawyer Description IIrs

Apr-25-17 VWD Telephone conference call with several people including I<en Pearl, 0.30Gary Cert~ato and respective counsel regarding sale of Strathcon~i sassets.

May-01-17 VWD Review etl~ail ti•om Gary Cei•rato regarding general terrns of a 0.20possible sale ofthe Property based on the email from Gould, the realestate broker•.

May-02-17 V WID Review proposed '1'ezm Sl~eef regarding the possible sale of the 0.50Property; review emails fi-oiza clie~lt a~7d Ian Bt°ady regarding same;telephone convet•sation with Brian Pritchard; email to client and IanBrady regarding Term Sheet.

May-03-17 VWD Review revised Term Sleet regarding potential sale of Property; 0.50email to client.

May-10-17 VWD Review Non-bindintr Letter of Intent for Belleville Property; 0.00telephone discussion witVl Gary Cerrato regarding same.

.May-1 1-17 VWD Telephone conversation witi~ Ia~~ Brady regarding Ter~~~ Sheet 0.G0regai•diiig prospective purchaser; review Sidney's reply to TermSheet; review emails fi-onz Receiver to Avaya regarding May Bent.

May-I5-17 VWD Review emails from Avaya, client and Bernie Ouel(et; email to x.20client regarding same.

1~9ay-15-17 VWB Telepho~le col~versation with Gary Cerrato regarding status of 1~0t; 0.30email to Ian Brady regarding same.

fog~er .~b~nof~

aD te Lawyer Description Ir

May-17-17 V WD Review Non-binding letter of intent dated May 16, 2017 from 1.30To~•onto Capita] Corporation and OREA Confirmation ofCo-operation form; telephone conference call with Gary Cerratoand Brian Pritchard regarding same; review emails from Ian Bradyto Ron Donaldson regarding environmental reports.

May-18-17 VWD Telephone conversation with Ian Brady regarding potential offers 0.30for property; email to client regarding same.

May-18-17 V WD Review and revise Purchase Agreement between the Receiver and 320prospective purchaser of the Prope►•ty; email to client and Ian Bradyregarding same.

May-19-17 V WD Review changes made to the draft Purchase Agreement between the 1 . I UReceiver and prospective purchaser; telephone conversation withIan Brady; e►nail exchange with client regarding same.

OUIt FLL+; HI~,I2T?[N $4,823.00

Disbursera~ents

Total Disbursements $0.00

Total Fees and Disblirsemei3ts $4,823.00

HST @ 13% on Fees and Taxable Disbursements $626.99

Total Tees, Disbursements and Taxes this Bill $5,449.99

BalZnce I)ue: X5,449.99

THIS IS OUR ACCOUNT II~R~IN THIS ACCOUNT' 13L'ARS INTEREST, COMMENCING ONE N,ON'tll APT'ERDELIVERY, AT TFIl RACE OF 3.30 % PER ANNUM AS AUTHOR[ZED 13Y

FOGLER, RUBINOFF LI.~~ THE SOLICITORS' ACT. ANY DISBURSEMENTS NOT POSTED 7'O YOURACCOUN"P ON THE DATE OF TH[S STA"CEMEN"1' WILL BE BILLED

t ~~ ~ ~

LATER.

E. & O.E. CS'C/FIS'P No :8119420859~ 4 Please return n copy ojlhis accoiuv wish yom• paymenC ~hnnk you~~ L ~ ~

Vern `~V. llaRe

Page 2 of 2

This is Exhibit °F" refer~reci to in the Affidavit of Jared Schwartz sworn

before me this 25 x' day of July, 2017


June 23, 2017

13D0 Canada Limited419 King Street West, Suite 502Oshawa Executive CentreOshawa ONLIJ 2K5Attention: Brian Pritchard


Our File: 132816 / 166407Receivership of 2428049 Ontario Inc.

IN ACCOUNT ~V17'}1Fogler, Rubinoff LLP



M5K 1 G8Tetephone:416-864-9740

Fax: 416-941-8852www.fogters.com

f~ ~e

Date Lawve~. llesc►•intion I~rs

May-31-17 VWD Review revised Offer to Purchase as signed by the Purchaser; email 1 .50to client regarding same; review emails from Sidney Street's lawyer,Ian Brady; review land titles search.

Jun-Ol -17 V WD Review email from Gary Cerrato regarding Offer to Purchase; 0.40telephone call from Ken Pearl regarding auction sale on Sti-atllco»apremises; review Minutes of Settlement regarding same; email toclient.

Jun-OS-17 VWD Review Condition Summary prepared by DWG and issued cheque; 0.40review email from client; reply to same.

Jw1-07-17 VWD Review terms of signed Offer to Purchase; begin drafting Motion 3.20materials for vesting order and other• relief including notice ofmotion and draft Order.

Jun-08-17 VWD Review emails from client and Ian F3rady and reply to same; }~r~epare 4.40first draft of Factum and Brief of Authorities and highlight cases forsame regarding Approval and Vesting Order motion.

Jun-12-17 VWD Review email from Ian Brady regarding condition of financial 020covenant regarding the Put-chaser; email to client i-egai•di~1g sane.

Jun-12-17 VWD Review applicable T4 slips regarding financial covenant of O.COPurchaser; confer-ei~ce call with Gary Cerrato and Brian Pritchardregarding same; email to Purchaser's lawyer and othees co~lfir~ningIteeeiver's satisifaction with Purchaser's covenant.

:tun-14-17 VWD Revie~~~ emails from client regarding status of Purchaser's due 0.30diligence efforts u3~der Purchase Agreement and reply to same.

Juu-16-17 VWD Review em~iils from Kerl Pearl nn behalf oFI~uller Landau as 2.20receiver- of Stratl~coi~a, conf7rming that tl~e receiver was leavi~~g tl~epremises and making payment pursuant to Minutes of Settten~ent;review Minutes a~Id draft Landlord Ac]<nowledgmeilt; emails toclient; einails to Ian Brady, cotmsel for Sidney Street.

Jun-16-17 VWD Review email from Frank Mondelli of Toronto Capital, prospective 0.20purchaser.

foglerb~i~~~~Lawyer Descr►ration

Jun-i9-17 VWD Review emails from Ian Brady regarding meeting with Purchaserincluding meeting with Avaya.

,Tun-20-17 VWD E-mail to client regarding status of payment from Strathcona'sReceiver'.

Jun-20-17 VWD Telephone conversation with Ian Brady; email exchanges withclient.

Jun-21-17 V W L) Review emails and voice-mail messages from Ian Brady, counselfor Sidney Street; review draft Amending Agreement to PurchaseAgreement and comment on same; emails to client and Ian Bradyregarding same and scheduling of Receiver's motion for a vestingorder.

Jun-21-17 VWD Telephone conversation with Ian Brady; review further revisions toAmending Agreement to Purchase Agreement; emails to and fromclient regarding same.

OUR FEE HERF,IN

~)1Sbi11'SCI11CIltS

Taxable Prints .`n28.~0Taxable Search of Title `631.65

Total Disbursements

ToTal Fees and Disbursements

FIST @ l3% on Fees and Taxable Disbursements

Total Fees, Disbursements and Taxes this Bill

0.20

0.10

0.40

1.40

0.60

$8,533.{?(}

$60.45

$8,593.45

$1,117.14

$9,710.59

Balance llue: $9,710..>"9

THIS IS OUR ACCOUNT HEREIN THIS ACCOUN? BFA2S IN'CEKESI', COMMENCING ONE MON"CH AF"1'GRDLL1vERY, A7' 7'1IE RATE OF 330% PFR ANNUM AS AUTHORI7ED Bl'

FOGLER, RUBINOFF LLP THE SOLICITORS' ACC. ANY DISBURSbMENTS NOT POSTED TO YOURACCOUNT ON THE DA'~E OF TEAS STATEMENT WILL BB E3ILL6D

~'~ Ln•rex.~ ; ~ .'- 1

i ~ ti. & O.E. GST/FIST No : RI19420859~':. ~~ ~ `~~ ~~ ~ ,,, Please return n cope ojdiis aceam( wish }your pnynrenL Thank}+nip.s;

—~

Ves•n ~V. DaRe

Page 2 of 3

foggier

Por your convetlience, we have the following payment optio~ls:

• Online bankirlg using the Bill Payil~ent~ Service at most Canadia~l chartered balks. Pleasereference your file or account ~~innbe.r in tl~e notes box.

• Direct Deposits at a TD Branch (please provide your Fogler, Rubinoff lawyer with a copy of thecheque and deposit receipt}.

• Wire ti•atlsfer (please refere~ice yout~ file or account number).

• Electronic Funds Transfer• (~F7'}.

• Cheque by mail or courier.

Should you require assistance, please contact our Accou~lts Receivable Depart-tme~It at 416.8649700 Y152ot• by e-mail acc;ountsrecei~abler~r',fi~g;le~_s_com.

Page 3 of 3

Sidney Street Properties Corp. and 2428049 Ontario Inc.Applicant Respondent Court File No. CV-16-11565-OOCL

ONTARIOSUPERIOR COURT OF JUSTICE(COMV[ERCIAL LIST)


FED AFFIDAVIT OF JAREDSCH'WARTZ

FOGLER, RUBINOFF LLPL,a~ryers77 Kind Street WestSuite 3000, Y.O. Box 95TD Centre North TowerToronto, ON M~K 1G8

Vern W. Dane (L.SUC# 32591 E)Tel: 416-941-8842Fax: 416-941-8852


CONFIDENTIAL APPENDIX 1

CONFIDENTIAL APPENDIX 2

a



THE HONOURABLE ) THURSDAY, THE 3 d

JUSTICE ~ DAY OF AUGUST, 2017

BETWEEN:


Applicant

- and -


Respondent

APPROVAL AND VESTING ORDER

THIS MOTION, made by BDO Canada Limited, in its capacity as the Court-appointed

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

"Debtor") for an order, among other relief, approving the sale transaction (the "Transaction")

contemplated by an agreement of purchase and sale or offer to purchase executed June 1, 2017,

as amended (the "Sale Agreement") between the Receiver and Toronto Capital Corp. ("Toronto

Capital") as accepted by Sidney Street Properties Corp., Rentx Properties Corp. and Rentx

Transportation Services Corp. and appended to the Report of the Receiver dated July 27, 2017

(the "Second Report"), and vesting in • (the "Purchaser"), as the assignee of Toronto Capital's

rights, obligations and title under the Sale Agreement, the Debtor'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.

DOCSTOR: 1201927\13

-2-

ON READING the Second Report and on hearing the submissions of counsel for the

Receiver and any one appearing for any other person on the service list, as properly served as

appears from the affidavit of Michelle Pham sworn July 27, 2017, filed:

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

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

such minor amendments as the Receiver may deem necessary. The Receiver is 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 completion of the Sale

Agreement and 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 the real

property described on 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 benerality of the foregoing: (i) any

encumbrances or charges created by the Order of the Honourable Justice Penny dated December

13, 2016; (ii) all charges, security interests or claims evidenced by registrations pursuant to the

Personal Piropef~ty Security Act (Ontario) or any other personal property registry system; and (iii)

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, 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 the Land Registry Office for the

Land Titles Division of Hastings (No. 21) of an Application for Vesting Order in the form

prescribed by the Land Titles Act and/or the Land Registration Refo~~n~ Act, the Land Registrar is

hereby directed to enter the Purchaser as the owner of the subject real property identified in

DOCSTOR: 12019270 3

-3 -

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 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.

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

the Receiver's Certificate, forthwith after delivery thereof.

6. 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 Debtor and any

bankruptcy order issued pursuant to any such applications; and

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

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 Debtor and shall not be void or

voidable by creditors of the Debtor, nor shall it constitute nor be deemed to be a settlement,

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.

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


DOCSTOR: 1201927\ 13

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.

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

Record is hereby abridged so that this Motion is properly returnable today and hereby dispenses

with further service thereof.

9. THIS COURT ORDERS that the Second Report and the actions and activities of the

Receiver as described in the Second Report are hereby approved.

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

$61,332.04 including taxes are hereby approved.

1 1. THIS COURT ORDERS that the fees and disbursements of the Receiver's counsel in the

amount of $73,331.57 including taxes are hereby approved.

12. THIS COURT ORDERS that the receipts and disbursements of the Receiver, as set out in

the Second Report, are hereby approved.

13. THIS COURT ORDERS the sealing of Confidential Appendices "1" and "2" to the

Second Report until completion of the Transaction under the Sale Agreement, or further order of

this Court.

14. THIS COURT ORDERS that, for greater certainty, the real estate commission payable

upon the completion of the Transaction is the amount set out in Appendix "E" to the Second

Report.

DOCSTOR: 1201927\13

Schedule A —Form of Receiver's Certificate



BETWEEN:


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 December 13, 2016, BDO Canada Limited was appointed as the


"Debtor").

B. Pursuant to an Order of the Court dated August 3, 2017, the Court approved the

agreement of purchase and sale or offer to purchase made as of June 1, 2017 (the "Sale

Agreement") between the Receiver and Toronto Capital Corp. ("Toronto Capital") as accepted

by Sidney Street Properties Corp., Rentx Properties Corp. and Rentx Transportation Services

Corp., and vesting in • (the "Purchaser"), as the assignee of Toronto Capital's rights, obligations

and title under the Sale Agreement, the Debtor'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

DOCSTOR: 1201927\13

-2-

Purchase Price for the Purchased Assets; (ii) that the conditions to Closing as set out in the Sale

Agreement have been satisfied or waived by the Receiver 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 the Sale Agreement have been satisfied or waived

by the Receiver and the Purchaser; and

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

4. This Certificate was delivered by the Receiver on • , 2017.

BDO CANADA LIMITED, in its capacity asReceiver of the undertaking, property andassets of the Respondent, and not in itspersonal capacity

Per:

Name:

Title:

DOCSTOR: 1201927\ 13

Schedule B —Legal Description of Real Property

PIN 40457-0153 (L

PT LT 7, 11 RCP 1819 SIDNEY PT 1 21R19819; BELLEVILLE; COUNTY OF HASTINGS

PIN 40457-0148 (LTA

PT LT 7, 10-11 RCP 1819 SIDNEY PT 2 21R19819; BELLEVILLE; COUNTY OF HASTINGS

Municipally known as 250 Sidney Street, Belleville, Ontario.

DOCSTOR: 1201927U 3

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

REG. NUM. DATE INSTRUMENT TYPE AMOUNT PARTIES FROM

(1) HT162547 2014/10/15 CHARGE $2,170,000 2428049 ONTARIO INC.

(2) HT175724 2015/08/05 CONSTRUCTION $100,491 HAMILTON SMITH LIMITED

LIEN

(3) HT178289 2015/09/22 CERTIFICATE HAMILTON SMITH LIMITED

(4) HT195178 2016/09/01 NOTICE OF LEASE 2428049 ONTARIO INC.

PARTIES TO

SIDNEY STREET PROPERTIESCORP.

AVAYA CANADA CORP

DOCSTOR: 1201927\ 13

Schedule D —Permitted Encumbrances, Easements and Restrictive Covenantsrelated to the Real Property

(unaffected by the Vesting Order)


(1) HT111849 2011/09/19 CERTIFICATE ONTARIO MINISTRY OF THEENVIRONMENT

PARTIES TO

PALMER ROAD PROPERTIESCORP.

(1) any easements, rights of way or licenses for any purpose whatsoever located on, around, over or upon the Real Property and required in connectiontherewith;

(2) any site plan agreements or references, development agreements or subdivision agreements required by any governmental or municipal authority in

connection with the Real Property and/or the subdivision of same, whether registered on title or not;

(3) any encroachments by the buildings located on the Real Property unto any adjoining property or street and any encroachments by any structure located

on adjoining property unto the Real Property; and

(4) any work orders, notice of infractions or other municipal stop orders or deficiencies.

UOCSTOR: 1201927\ 13

a

f7s!!!~~ ~ _ ~ ~1T~Tir~l


ONTARIOSUPERIOR COURT Off' JUSTICE (COMMERCIAL

LIST ~

THE HONOURABLE ) THURSDAY. THE 3 d

JUSTICE ~ DAY OF AUGUST, X82017

BETWEEN:


Applicant

- and --


Respondent

APPROVAL AND VESTING ORDER

THIS MOTION, made by {}BDO Canada Limited in its capacity as the Court-appointed

receiver (the "Receiver") of the undertaking, property and assets of {-}the Respondent (the

"Debtor") for an order among other relief approving the sale transaction (the "Transaction")

contemplated by an agreement of purchase and sale or offer to t~urchase executed June 1, 2017, as

amended (the "Sale Agreement") between the Receiver and (}Toronto Capital Corb. (~

~~p,,,. '~^~~,•~~` a~+~'~ nTOT'Of1t0 Capital"1 as accepted by Sidney Street Properties Corn.. Rentx

Properties Corp. and Rentx Transportation Services Corp. and appended to the Report of the

Receiver dated (}July 27, 2017 (the "Second Report"), and vesting in the p~~r~'~~~~r *~~

~te~'-"Purchasers, as_ the_assi~nee of Toronto Capital's rights, obligations and title under the

Sale Agreement the Debtor's right, title and interest in and to the assets described in the Sale

DOCSTOR:1201927U3~D C'T R:~1927\13

Agreement (the "Purchased Assets"), was heard this day at 330 University Avenue, Toronto,

Ontario.

ON READING the Second Report and on hearing the submissions of counsel for the

Receiver, ~--r -~ and anv one appearing for any other person on the service list, ~l~~as properly

served as appears from the affidavit of {Michelle Pham sworn {}July 27, 2017, filed}:

1. THIS COURT ORDERS AND DECLARES that the Transaction is hereby approved,2 and

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

such minor amendments as the Receiver tnay deem necessary. The Receiver is 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 completion of the Sale

Agreement and 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 r^ including the

real property described on Schedule B hereto}4 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

~ 5

~>

5

4 ~.

DOCSTOR: 1201927\13DO~OK 1201927\13

3

"Claims"~) including, without limiting the generality of the foregoing: (i) any encumbrances or

charges created by the Order of the Honourable Justice {}Penny dated {}December 13, 2016; (ii) all

charges, security interests or claims evidenced by registrations pursuant to the Personal Propet~ty

Security Act (Ontario) or any other personal property registry system; and (iii) 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, 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 the Land Registry Office for the

b

Land Titles Division of ~}Hastin~s (No.

of an Application for Vesting Order in the form prescribed by the Land Titles Act and/or the

Land RegistJ~ation Refof~fn Act}~, the Land Registrar 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 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

. ..., .~ .......... ..... .~ .,,,.......,.... ...»~ ~ .. ...,..... .,...,., ...,......., .. .. ..... .,. .t, ., ......., ...,.,.., .. ...,... .,. ~}. .0 .. ~t.u~.... ~., .....~.v

b > > b

' ~ b > >t

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on

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5 >

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p

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o~c 4nN~ ~

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' ~.

DOCSTOR: 1201927\ 13 DO~QR: 1201 27\ 13

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.

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

Receiver's Certificate, forthwith after delivery thereof.

~, ~~

r t, ~ „~; , ~.<, ~t,o r,A~,~„

6. ~-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

Bank~~uptcy and Insolvency Act (Canada) in respect of the Debtor and any

bankruptcy order issued pursuant to any such applications; and

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

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 Debtor and shall not be void or

voidable by creditors of the Debtor, nor shall it constitute nor be deemed to be a settlement,

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.

DOCS'COR: 1201927\ 13 DO~~~01927\ 13

7. ~--THIS COURT HEREBY REQUESTS the aid and recognition of any court, tribunal,


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

All counts, tribunals, regulatory and administrative bodies ate 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.

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

Record is hereby abridged so that this Motion is properly returnable today and hereby dispenses

with further service thereof.

9 THIS COURT ORDERS that the Second Report and the actions and activities of the

Receiver as described in the Second Report are hereby approved.

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

$61,332.04 including taxes are hereby approved.

1 1. THIS COURT ORDERS that the fees and disbursements of the Receiver's counsel in the

amount of $73,331.57 including taxes are hereby approved.

12. THIS COURT ORDERS that the receipts and disbursements of the Receiver, as set out in

the Second Report, are hereby approved.

13. THIS COURT ORDERS the sealing of Confidential Appendices "1"and "2" to the Second

Report until completion of the Transaction under the Sale Agreement, or further order of this

Court.

14. THIS COURT ORDERS that, for greater certainty, the real estate commission payable

u on the completion of the Transaction is the amount set out in Appendix "E" to the Second

Rme

DOC STOR: 1201927\ 13 D~~TQR: 1201927

DOCS"I'OR: 1201927\ 13 DOCSTOR: 1201927\ 13

~- ~i t t

Schedule A —Form of Receiver's Certificate


ONTARIOSUPERIOR COURT OF JUSTICE (COMMERCIAL

LIST ~

BETWEEN:


A~blicant

- and --


Respondent

RECEIVER'-'S CERTIFICATE

RECITALS

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

Justice (the "Court") dated {}-{}December 13 2016 BDO Canada Limited was appointed as the

receiver (the "Receiver") of the undertaking, property and assets of {}the Respondent (the

"Debtor")

B. Plu~suant to an Order of the Court dated {-};August 3, 2017, the Court approved the

agreement of purchase and sale or offer to purchase made as of {~-June 1. 2017 (the °Sale

DOCSTOR: 1201927U 3

-2-

Agreement") between the Receiver {-j-and {}Toronto Cabital Cora. (~ """'•e-~-~ ~r ~`--~~~.T~~T~L11G~~

der "Toronto Capital"1 as accepted by Sidney Street Properties Com., Rentx Properties Corn.

and Rentx Transportation Services Corq., and vesting in the "Purchaser-e€' . as the assignee of

Toronto Capital's rights, obligations and title under the Sale Agreement the Debtor'-'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 Purchases• 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 ~~~~ the Sale Agreement have been satisfied or waived by

the Receiver and the Purchases; 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 iii

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 ~~ the Sale Agreement have been satisfied

or waived by the Receiver and the Purchaser; and

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

4. This Certificate was delivered by the Receiver-~t-{} on -~}~ , 2017.

~~vnnR~ n~ n~~~Tv~u~BDO CANADALIMITED, in its capacity as Receiver of theundertaking, property and assets of~8~:-~9~}the Respondent, and not in itspersonal capacity

Per:

Name:

Title:

DOCSTOR: 1201927\I3

• ~i t 1i:~ ~...RO .......v."

Schedule B ~'•~r^~^~^~' ~~^*~ Leal Description of Real Pronerty

PIN 40457-0153(LT~

PT LT 7, 11 RCP 1819 SIDNEY PT 1 21R19819; BELLEVILLE; COUNTY OF HASTINGS

PIN 40457-0148 (LTl

PT LT 7 10-11 RCP 1819 SIDNEY PT 2 21R19819• BELLEVILLE• COUNTY OF HASTINGS

Munici~allv known as 250 Sidnev Street, Belleville, Ontario.

DOCSTOR: 120192 7\ 13

! ~~ • t

REG. NUM. DATE

~1 HT162547 2014/10/15

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

INSTRUMENT TYPE AMOUNT PARTIES FROM

CHARGE $2,170,000 2428049 ONTARIO INC.

~2 HT175724 2015/08/05 CONSTRUCTIONLIEN

~3 HT178289 2015/09/22 CERTIFICATE

~4 HT195178 2016/09/01 NOTICE OF LEASE

100 491 HAMILTON SMITH LIMITED

HAMILTON SMITH LIMITED


PARTIES TO

SIDNEY STREET PROPERTIESCORP.

AVAYA CANADA CORP

DOC S"I'0 R: 120192 7\ 13

Schedule D —Permitted Encumbrances, Easements and Restrictive Covenantsrelated to the Real Property

(unaffected by the Vesting Order)


~1. HT111849 2011/09/19 CERTIFICATE ONTARIO MINISTRY OF THEENVIRONMENT

PARTIES TO

PALMER ROAD PROPERTIESCORP.

1) anv easements, rights of wav or licenses for anv buraose whatsoever located on, around, over or upon the Real Proaertv and required in connectiontherewith;

(21 any site plan agreements or references, development agreements or subdivision agreements required by any ~overmnental or municibal authority inconnection with the Real Property and/or the subdivision of same whether registered on title or not•

~) any encroachments by the buildings located on the Real Property unto any adioinin~ property or street and any encroachments by any structure locatedon adioinin~ bropertv unto the Real Property; and

(41 any work orders, notice of infractions or other mtznicibal stop orders or deficiencies.

12:39:10 PMInput:

file://I:\F\Fuller Landau Group Inc_F2057\172290_2177427Document 1 ID Ontario Limited, Receivership

oflPleadings\model_approval_and vesting_order.doc

Description model_approval_and vesting order

file://I:\B\BDO CanadaDocument 2 ID Limited B2816\166407_Receivership of 2428049 Ontario

Inc\Pleadings~Approval and Vesting Order.doc

Description Approval and Vesting Order

Rendering set Standard

Legend:

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a



COMMERCIAL LIST

THE HONOURABLE ) THURSDAY, THE 3RD

JUSTICE ~ DAY OF AUGUST, 2017

BETWEEN:


- and -


DISCHARGE ORDER

Applicant

Respondent

THIS MOTION, made by BDO Canada Limited in its capacity as the Court-appointed


"Debtor"), for an order:

1. approving the payment and distribution of funds;

2. approving the holdback or reserve of funds to complete the administration of the

receivership;

3. discharging BDO Canada Limited as Receiver of the undertaking, property and assets of

the Debtor; and

4. releasing BDO Canada Limited from liability,

was heard this day at 330 University Avenue, 8"' Floor, Toronto, Ontario.

ON READING the report of the Receiver dated July 27, 2017 (the "Second Report"),

and on hearing the submissions of counsel for the Receiver, and any other person appearing from

DOCSTOR: 1201925\8

-2-

the service list, as properly served as evidenced by the Affidavit of Michelle Pham sworn July

27, 2017, filed;

1. THIS COURT ORDERS that the Receiver shall make certain payments and distribution

of funds, and reserve funds including the Professional Fee Reserve as described and in the

amounts set out in the Second Report.

2. THIS COURT ORDERS that upon the Receiver filing a certificate of completion with

this Court certifying that it has completed the activities described in the Second Report, the

Receiver shall be discharged as Receiver of the undertaking, property and assets of the Debtor,

provided however that notwithstanding its discharge herein (a) the Receiver shall remain

Receiver for the performance of such incidental duties as may be required to complete the

administration of the receivership herein, and (b) the Receiver shall continue to have the benefit

of the provisions of all Orders made in this proceeding, including all approvals, protections and

stays of proceedings in favour of BDO Canada Limited in its capacity as Receiver.

3. THIS COURT ORDERS AND DECLARES that BDO Canada Limited is hereby

released and discharbed from any and all liability that BDO Canada Limited now has or inay

hereafter have by reason of, or in any way arising out of, the acts or omissions of BDO Canada

Limited while acting in its capacity as Receiver herein up to and including the discharge date as

described in any of its reports to the Court, save and except for any gross negligence or wilful

misconduct on the Receiver's part. Without limiting the generality of the foregoing, BDO

Canada Limited is hereby forever released and discharged from any and all liability relating to

matters that were raised, or which could have been raised, in the within receivership proceedings,

save and except for any gross negligence or wilful misconduct on the Receiver's part.

ROCS"1'OR: 1201925\8

Sidney Street Properties Corp. and 2428049 Ontario Inc.Applicant Respondent Court File No. CV-16-11565-OOCL



ORDER

FOGLER, RUBINOFF LLPLawyers77 King Street WestSuite 3000, P.O. Box 95TD Centre North TowerToronto, ON MSK 1G8

Vern W. Dane (LSUC# 32591E)Tel: 416-941-8842Fax: 416-941-8852

Lawyers for the court-appointed Receiver ofthe Respondent, BDO Canada Limited

Sidney Street Properties Corp. -and - 2428049 Ontario Inc.

Applicant Respondent



(COMMERCIAL LIST)


MOTION RECORD(Returnable August 3, 2017)

FOGLER, RUBINOFF LLPLawyers77 King Street WestSuite 3000, P.O. Box 95TD CentreToronto, Ontario M5K 1G8


Lawyers for the court-appointedReceiver of the Respondent, BDOCanada Limited