Ontario · Receivership (court-appointed)
Motion Record of RBC Volume 3 of 3
Application / notice of application · 21 December 2022
AI summary
A plain-English summary drawn only from this filing: what it is, why it matters, and the parties, amounts and dates it turns on.
What we verified from this filing13 verified
- applicantROYAL BANK OF CANADA
- commencement date21 December 2022
- courtONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST
- court file noCV-22-00691955-00CL
- appointeeMSI SPERGEL INC.
- appointee roleProposed Receiver
- secured creditorsnote: RBC 'Facility #2' - described in Statement of Claim para 9 (PDF page 49) as 'a $562,848.78 non-revolving term facility.' The non-round figure suggests this is the outstanding term balance, but the document labels it as the facility rather than expressly as 'balance owing'; para 41's separate balance restatement (Dec 19, 2022) covered only the Operating Facility and Visa Facility, not Facility #2. Recorded as stated. · page: 49 · amount: 562848.78 · debtor: 1731861 Ontario Inc. operating as Plasticap · creditor: Royal Bank of Canada · currency: CAD · security: Same GSA (RBC Standard Form 924, July 26, 2020).
- secured creditorsnote: RBC 'Facility #3' - Statement of Claim para 9 (PDF page 49) describes 'a $500,000.00 non-revolving term facility.' Appears drawn, as the Operating Facility limit reduced from $1,750,000 to $1,250,000 'on the date of drawdown of Facility #3' (para 10). No separate outstanding balance is stated for Facility #3; the $500,000.00 is the facility amount, not a balance. · page: 49 · debtor: 1731861 Ontario Inc. operating as Plasticap · creditor: Royal Bank of Canada · currency: CAD · security: Same GSA (RBC Standard Form 924, July 26, 2020). Facility #3 described as a $500,000.00 non-revolving term facility (facility limit/principal - a round figure, not a stated balance).
- unsecured creditorsnote: DEEMED TRUST / priority Crown claim (payroll source deductions + HST) - ranks AHEAD of RBC's GSA (paras 40(a) and the priority discussion at PDF page 60). Stated as 'approximately $100,000' - amount contested/uncertain: Exhibit S CRA payroll (RP0001) notices show a 2021 T4-remittance discrepancy of $126,058.53 Dr that CRA required be explained (PDF pages 13-14 and 39), while the CRA arrears-account screen showed $0.00 owing across all years and a $7,359.09 CREDIT balance (PDF page 40); the debtor's tax counsel disputed the payroll-remittances position (PDF page 6). RBC also noted only $7,300 of this was reported on the Company's May margin report (PDF page 60). · page: 59 · as of: as of the November 17, 2022 meeting ('presently'), approximate · basis: Statement of Claim para 40(a) (monies owing to CRA for source deductions and HST which rank ahead of RBC's GSA) and RBC's November 17, 2022 meeting summary quoted at para 36 (PDF page 59): 'CRA priority payables outstanding for payroll/HST is approximately $100,000 presently.' · amount: 100000 · debtor: 1731861 Ontario Inc. operating as Plasticap · creditor: Canada Revenue Agency · currency: CAD
- unsecured creditorsnote: TD CEBA loan (Canada Emergency Business Account) of the Company - no amount stated (CEBA loans are typically up to $60,000); account noted as not active. Recorded for completeness; figure not disclosed in the document. · page: 59 · basis: Mention in RBC's November 17, 2022 meeting summary quoted in the Statement of Claim (para 36, PDF page 59): '173 has bank accounts at TD (CEBA loan) and BMO but you note these accounts are not active.' · debtor: 1731861 Ontario Inc. operating as Plasticap · creditor: The Toronto-Dominion Bank (CEBA loan) · currency: CAD
- secured creditorsnote: RBC Visa Facility - CAD component of the balance owing as of December 19, 2022 (Statement of Claim para 41, PDF page 62). The same Visa Facility also carries a US$41,323.24 balance recorded as a separate USD entry - these are two currency components of ONE facility; do not treat as two facilities or sum across currencies. · page: 62 · as of: 2022-12-19 · amount: 45149.34 · debtor: 1731861 Ontario Inc. operating as Plasticap · creditor: Royal Bank of Canada · currency: CAD · security: Same GSA (RBC Standard Form 924, July 26, 2020). Visa Facility credit limit was $101,000.00 available in CAD and USD (para 12) - a limit, not the balance.
- secured creditorsnote: RBC Operating Facility - balance owing as of December 19, 2022 (Statement of Claim para 41, PDF page 62). Repayable on demand; formal written demand made November 28, 2022 with a s.244(1) BIA notice of intention to enforce security (para 37). CRA deemed trust (payroll source deductions/HST) ranks AHEAD of RBC's GSA (para 40(a), PDF page 61). Personal guarantees provided by directors/officers Peter J. Gossmann and Thomas Frank Lato, each limited to principal $1,120,000.00 (RBC Form 812, July 26, 2020); RBC claims $1,120,000.00 against each guarantor. Collateral concern: approx. 80% of the Company's assets were moved to related party Polycap LLC (Lebanon, Virginia) and approx. 20% to Hawk Plastics Ltd. (Oldcastle, Ontario) without RBC's consent (paras 40(d)-(f)). · page: 62 · as of: 2022-12-19 · amount: 1255905.82 · debtor: 1731861 Ontario Inc. operating as Plasticap · creditor: Royal Bank of Canada · currency: CAD · security: General Security Agreement on RBC's Standard Form 924 signed by the Company on July 26, 2020 (the 'GSA'), over all present and after-acquired personal property / all assets, undertakings and property of the Company; RBC also registered a UCC Financing Statement on December 1, 2022 (Exhibit R). Operating Facility (Facility #1) is a $1,750,000.00 revolving demand facility reducing to $1,250,000.00 on drawdown of Facility #3 - facility limits, not the balance.
- secured creditorsnote: RBC Visa Facility - USD component of the balance owing as of December 19, 2022 (Statement of Claim para 41, PDF page 62). Same Visa Facility as the CAD $45,149.34 entry - one facility, two currency components; do not double-count or sum across currencies. · page: 62 · as of: 2022-12-19 · amount: 41323.24 · debtor: 1731861 Ontario Inc. operating as Plasticap · creditor: Royal Bank of Canada · currency: USD · security: Same GSA (RBC Standard Form 924, July 26, 2020). Visa Facility credit limit was $101,000.00 available in CAD and USD (para 12).