TORONTO — Justice Newbould of the Ontario Superior Court of Justice has released his decision that the Gibralt claim of $3,964,314.52 against TravelBrands is invalid and upheld TravelBrands’ disallowance of Gibralt’s claim.
In so doing, the judge has, subject to Gibralt’s appeal rights, taken a major step in eliminating this hurdle to the completion of TravelBrands’ plan.
Upon receiving this decision, TravelBrands brought a court application scheduled for Jan. 14 indicating that it intends to proceed with its plan when of all appeal periods relating to the Gibralt claim have expired. TravelBrands still retains the right to revoke its plan at any time before its implementation.
TravelBrands’ present plan is that a new company will buy certain assets at a price equal to their net book value, which TravelBrands did not disclose in the materials filed, claiming that disclosure of the purchase price may have a negative impact on TravelBrands’ ability to sell the assets to third parties in the event the plan for any reason fails.
The court application also asks for an order approving its second amended and restated plan dated Jan. 8, approving the termination of TravelBrands’ CCAA proceedings following the implementation of the plan, and discharging KPMG as the monitor upon implementation of the plan.
TravelBrands proposes to make the first payment to creditors with claims valued at less than $15,000 on before Feb. 29. The present plan contemplates paying other affected creditors 60% of their undisputed claims on or before Feb. 29, and the balance of their claims on or before Nov. 30.
TravelBrands released a statement following the decision.
“TravelBrands is pleased that the Ontario Superior Court of Justice has ruled that the claim from Gibralt Captial Corporation is invalid and has upheld TravelBrands’ denial of this claim.
“The Company continues to move forward to exit CCAA. TravelBrands will make a motion to the Court on Jan. 14, 2016 to secure a Plan Sanction and Termination Order. A Plan of Compromise or Arrangement, which would see all Affected Creditors paid in full, was overwhelmingly approved at a Meeting of Affected Creditors on Oct. 30, 2015.
“More details regarding TravelBrands’ plans for exiting CCAA and expected timelines will follow in due course. Until then, it continues to be business as usual for TravelBrands’ valued customers and partners.”
