Everwood: a second Envision DIP, to start Phase 3 and fund a first distribution

The last of the ten Phase 1 townhomes at Everwood, strata lot 2, closed on September 10. Its net price was $812,408 and it carried $43,995 of GST, and with it the proposal trustee, FTI Consulting Canada Inc., had collected $9,549,907 from the ten closings since the developer, 1281805 B.C. Ltd., filed its notice of intention in March: $9,160,242 in net sale prices and $389,665 in GST, per the Fifth Report of the Proposal Trustee, Sept. 16, 2026, paras. 15, 25–26. Two weeks earlier the company had asked for time to September 25 to file a proposal that, in the trustee's words then, depended on building and selling the next units, as reported here on September 3. The Fifth Report is the first account of how the company means to get there, and it runs through the same lender that financed the first phase and its completion.

On September 18, Justice Underhill approved a second interim facility from Envision Financial, a division of Tru Cooperative Bank, of up to $1,483,319, and in the same order directed the trustee to pay Envision's first mortgage out of the Phase 1 sale proceeds it holds, per the Order (Interim Financing and Distribution), Sept. 18, 2026, paras. 2–3, 9.

What is left, and what comes next

In the Fifth Report's terms, the three townhomes the company still owns are the "Phase 2 Units," and they are substantially complete. One of them was damaged by a fallen tree before the filing; repairs are under way and are expected to be paid for primarily from insurance proceeds collected during the proceedings. The undeveloped remainder of the land is "Phase 3," and the company has been in discussions with Envision about a financing plan to build residential units there, as well as about funding for continued operations and for its proposal, per the Fifth Report of the Proposal Trustee, Sept. 16, 2026, paras. 16–17. The trustee reports that "In the coming weeks, the Company intends to commence Phase 3 excavation work," and that it asked Envision for a new loan of approximately $1.5 million to do so, per the same report, para. 18.

The company's director put the need in general terms in his fifth affidavit. The company "has identified a funding shortfall in connection with the completion of its restructuring efforts, proposal process, and ongoing development activities," arising primarily from professional fees, restructuring costs, administrative expenses, working capital, refinancing efforts and the work needed to advance "the remaining stages of the Everwood Project." Without more financing, he deposes, the company "will likely be unable to continue pursuing its restructuring strategy, including filing and implementing a proposal to its creditors," per the Affidavit #5 of the director, Sept. 16, 2026, paras. 5–7. He is not aware of any creditor that would be materially prejudiced by the facility, and believes it will improve the company's prospects of presenting a viable proposal, per the same affidavit, paras. 14–15.

The second offer of credit

Envision's offer of credit is dated September 16, 2026 and was to lapse if not accepted by 4:00 p.m. on September 24. It is for a non-revolving senior secured super-priority facility of up to $1,483,319, at prime plus 4.00%, with prime stated at 4.45% on the offer's date; the April facility was priced at prime plus 3.50%, per the Affidavit No. 2 of the director, Apr. 19, 2026, Ex. "A", p. 2. Interest is payable monthly from a $32,000 reserve the borrower cannot touch. The commitment fee is $30,000, non-refundable, and financed within the loan. Maturity is the earliest of four months after the first advance, the lifting of the stay without Envision's consent or the end of the proceedings, a conversion into a CCAA proceeding or a receivership, or ten days after notice of default, and everything owing is due on that date, per the Affidavit #5 of the director, Sept. 16, 2026, Ex. "A", pp. 2–3, 5–6.

The purpose clause lists six uses: approved soft costs for the three completed Phase 2 townhomes and "land preparation of contemplated Phase 3"; professional fees and expenses of the proceeding; monthly interest and standby fees; the financed commitment fee; "payout of the residual Phase 1 mortgage and allowance of a partial payment to unsecured creditors under an agreed settlement proposal"; and Envision's own closing costs, per the Affidavit #5 of the director, Ex. "A", p. 2. Mr. Mann describes the last of those as "funding for the initial distribution contemplated under the proposal currently being developed," per the same affidavit, para. 12. The trustee puts it as "an initial amount to be distributed to creditors during the NOI proceedings," per the Fifth Report of the Proposal Trustee, para. 19. Before the first advance, Envision may call for its own appraisal or opinion of value of the project, a quantity surveyor's report and a detailed construction budget and timetable, and it will want monthly cash-flow statements reviewed by the trustee and a quantity surveyor's report every 45 days while the loan is out, per the Affidavit #5 of the director, Ex. "A", pp. 3–5. The security schedule keeps everything Envision already holds: the first mortgage and assignment of rents over 23697 Fern Crescent, general security agreements from the debtor, its two joint-venture partners Wood Lock Developments Ltd. and 1281826 B.C. Ltd., and four corporate indemnitors, cost-overrun agreements and indemnities from the director and four other individual indemnitors, and postponements of shareholder loans. To that it adds the court-ordered charge and a confirmation of existing security, per the same affidavit, Ex. "B", Sched. "A".