Felix & Paul: one offer for the name, from a related buyer

On October 26, Restructuration Deloitte inc., trustee in bankruptcy of Felix & Paul Studios Inc., asked the Superior Court of Québec to approve the sale of the studio's name and a catalogue of its works to a company whose directors and shareholders were also directors of the studio. The motion, which cites s. 30(4) to (6) of the Bankruptcy and Insolvency Act, seeks an approval and vesting order transferring two lots to 18253145 Canada Inc.: Lot A, a catalogue of eight works and the Storyteller plug-ins, listed in a schedule to the buyer's proposal, and Lot B, the Felix & Paul Studios brand, the felixandpaul.com domain and related digital assets. The buyer would take them as is, where is, without warranty from the trustee and free of any claim, charge and security. The studio, founded in 2013 and based in Montreal, created and produced immersive audiovisual content, cinematic virtual-reality experiences among it, per the Trustee's Motion for an Approval and Vesting Order, Oct. 26, 2026, p. 1 and paras. 1, 6–8, 32–33.

The trustee's Second Report, dated October 23, describes Lot A as a catalogue of eight immersive cinematic works and gives the consideration as $70,000, to be paid to the trustee and distributed to creditors according to their respective rights and priorities, in a report that states its amounts in U.S. dollars unless it indicates otherwise, per the Second Report of the Trustee, Oct. 23, 2026, paras. 4(b), 43, 45. The motion describes the buyer as a business corporation working in the production of films and visual material. Its directors and shareholders are three people, all of whom were also directors of the studio; one of them is also a shareholder of it. The trustee is of the view that the buyer is a person related to the studio within the meaning of s. 30(5) of the BIA "and therefore requires the authorization of this Court to sell" [translation] the lots, per the Trustee's Motion, Oct. 26, 2026, paras. 29–31 and the Second Report, paras. 41–42. The motion is returnable on October 29.

After the cameras

When this matter was reported here on September 18, a registrar had just let Deloitte sell the studio's lunar camera technology and its Space Explorers franchise to 18201714 Canada inc. ahead of the first meeting of creditors; the Second Report records that order as made on September 17, per the Second Report, para. 7. The sale has closed: the trustee's report on its preliminary administration, dated September 28, says it received the total consideration of 350 000 $ in its trust account, in a report that states its amounts in U.S. dollars unless it indicates otherwise, per the Report of the Trustee on Its Preliminary Administration, Sept. 28, 2026, paras. 3, 33.

The creditors met by videoconference at 10 a.m. on September 28, confirmed Deloitte as trustee and Osler, Hoskin & Harcourt as its counsel, and appointed four inspectors: representatives of National Bank of Canada, the Société de développement des entreprises culturelles (SODEC), Export Development Canada and Investissement Québec, per the Minutes of the First Meeting of Creditors, Sept. 28, 2026, pp. 1–2. All four lenders are among the six creditors that, the Second Report says, claim first-ranking security over the studio's assets; with BDC Capital and Canada Economic Development, their claims stood at US$22,191,000 on the studio's books at July 31, per the Second Report, paras. 30–31. The trustee had Osler review the conventional security of National Bank, Investissement Québec, Export Development Canada, SODEC and the Business Development Bank of Canada, and the report says the opinion concludes, subject to the usual assumptions and reservations, that the secured creditors' hypothecs are valid and opposable to third parties, per the Second Report, paras. 35–36.

Ninety-nine parties and four offers

From September 16 to October 9, Deloitte ran a second process to liquidate the studio's assets, the two lots among them. It contacted 99 potential acquirers, 76 of them strategic buyers and 23 auctioneers, held four equipment visits and 12 meetings with potential buyers, and received four offers, per the Second Report, para. 37 and the Trustee's Motion, para. 25. Only the buyer bid for Lots A and B, and it sent its proposal to the trustee on October 9, per the Second Report, paras. 37(d), 38.

Two other offers were retained for other assets of the studio, and the inspectors approved them unanimously at their first meeting, on October 16. The buyer had also bid for assets its proposal defines as Lot C, but two other offers were retained for those assets "because of the higher consideration offered" [translation], and the trustee rejected the buyer's Lot C offer, per the Second Report, paras. 9, 37(e), 39. Another offer, for an asset the report calls the "Interstellar Arc immersive experience" [translation], was rejected by the trustee because the consideration was too low and because of the various conditions attached to it, "making the transaction too onerous" [translation], per the same report, para. 40. Slower-than-expected growth in revenue from the studio's production Interstellar Arc is one of the causes the studio gives for its financial difficulties, per the Second Report, para. 33(b).