National Traffic Safety: no stay of the deemed bankruptcy

National Traffic Safety Management Inc. provides traffic management for construction and infrastructure job sites, keeping the workers on them safe, and it filed its second notice of intention to make a proposal on April 24, 2026, per the Sixth Report of the Proposal Trustee, Oct. 21, 2026, para. 1 and the Ramudden affidavit, affirmed Oct. 21, 2026, para. 3. "The gating issue," Justice J. Dietrich wrote on October 22, is that under s. 50.4(8)(a) of the Bankruptcy and Insolvency Act the company "will be deemed to make an assignment in bankruptcy on October 26, 2026 (the date six months from the filing of its Notice of Intention to Make a Proposal)." The proposal trustee, TDB Restructuring Limited, had asked the court to stay that deemed bankruptcy "to provide additional time for a disputed sale approval motion to take place." The endorsement answers in the same paragraph: "As set out below, I am not prepared to do so," per the Endorsement of Dietrich J., Oct. 22, 2026, para. 2.

The disputed sale is to Ramudden Global (Canada) Inc., which the endorsement calls "an unrelated entity." The trustee has determined that Ramudden's offer represents "the most favourable outcome for the Company's creditors and other stakeholders," and the company's counsel has advised that the company's sole director and officer, who owns the other bidder, opposes the completion of the transaction, per the Endorsement of Dietrich J., Oct. 22, 2026, paras. 3–4. That bidder is A2 Environmental Group Inc., which the trustee describes as a related company owned by the sole director and officer, per the Sixth Report of the Proposal Trustee, Oct. 21, 2026, paras. 12–13. When this case was reported here on October 14, the trustee had just proposed a round of binding offers, and the court had extended the company's time to file a proposal to and including October 26, per the Order of Dunphy J., Oct. 13, 2026, para. 2.

Two bids and a round of highest and best

The trustee had been considering transactions with three interested parties: A2, the group of shareholders its reports call the Shareholder Group, and Ramudden. Binding offers were due by noon on October 16, unconditional apart from court approval and a vesting order, each with a deposit payable before the next court attendance seeking approval of a transaction. At the request of one of the interested parties, which the report does not name, the trustee moved the deadline to 5 p.m. that day and told all of them. Two bids came in, one from A2 and one from Ramudden; the report records none from the Shareholder Group, per the Sixth Report of the Proposal Trustee, Oct. 21, 2026, paras. 12, 14, 16–17.

The trustee weighed them having regard to, among other things, "the purchase price, the proposed treatment of creditors and other stakeholders, the certainty of closing and the ability of the proposed purchasers to complete their respective transactions," then invited both bidders to submit their highest and best offers by noon on October 19. A2 submitted an amended offer. Ramudden did not submit any further offer or amendment. Having completed its evaluation, including of A2's amended offer, the trustee settled on what its report calls the Proposed Transaction, the one in a binding letter of intent signed by Ramudden and dated October 16, per the Sixth Report of the Proposal Trustee, Oct. 21, 2026, paras. 5, 17–19. The trustee calls it "the best available outcome for the Company's creditors and other stakeholders in the circumstances" and "a materially better result for the Company's creditors and other stakeholders than a bankruptcy," and intends to give the court its full assessment in its next report, in support of a motion to approve the transaction, per the Sixth Report of the Proposal Trustee, Oct. 21, 2026, paras. 23–24.

The trustee told both offerors and the company of its assessment. The company's counsel advised that the sole director opposed the completion of the transaction contemplated in the letter of intent. Given that opposition, the report says, the parties need additional time to prepare materials and then attend a hearing to address any dispute, which the trustee was hopeful could happen "as early as next week subject to the court's availability," per the Sixth Report of the Proposal Trustee, Oct. 21, 2026, paras. 20–21.

The financial terms are in two confidential appendices: a summary of the offers with their material terms, and an unredacted copy of the letter of intent. They contain, the report says, "the financial terms of the Offers received from interested parties, the purchase price and other material terms of the Proposed Transaction, and information relating to the unsuccessful bidders." The trustee asked that they be sealed until the transaction closes or the court orders otherwise, concerned that disclosure could prejudice creditors and other stakeholders, "particularly if the Proposed Transaction does not close and it becomes necessary to pursue an alternative transaction or undertake further realization efforts," per the Sixth Report of the Proposal Trustee, Oct. 21, 2026, paras. 22, 26–29. The endorsement records the sealing request and makes no ruling on it, per the Endorsement of Dietrich J., Oct. 22, 2026, para. 1.

What Ramudden says it offered

Ramudden's own account of its offer is in an affidavit affirmed on October 21 by its director. The letter of intent, the affidavit says, was submitted on Friday, October 16, to acquire substantially all of the company's business and assets. It "provides all cash consideration subject to adjustments for missing equipment, and the assumption of specified liabilities," and Ramudden has paid a cash deposit to the trustee, to be credited toward the purchase price on closing, per the Ramudden affidavit, affirmed Oct. 21, 2026, paras. 1, 12–13. The affidavit says the letter also provides for the acquisition of substantially all operating assets, subject to specified exclusions; for a directed payment "from the cash consideration to Emkay for the buyout and transfer of leased vehicles"; and for "offers of employment to substantially all salaried and all union employees, and the continuation of unionized employees' employment under the applicable collective agreement." The offer is not conditional on financing and, in the affidavit's words, "can be closed on or before October 26, 2026, consistent with the deadline identified by Justice Dunphy," per the Ramudden affidavit, affirmed Oct. 21, 2026, paras. 14–15.

On the advice of Ramudden's counsel, the affiant deposes that the bid will provide for payment of the post-filing amounts owing to the company's unions and to the Canada Revenue Agency, payments to the unions for pre-filing pension and vacation amounts, a payout to Oxygen Working Capital Corp., which the affidavit calls the company's principal secured creditor, on account of its term loan, and a payout to Emkay Canada Leasing Corp. in respect of the vehicles leased to the company, per the Ramudden affidavit, affirmed Oct. 21, 2026, para. 16. The letter of intent and the asset purchase agreement meant to supersede it are attached to the affidavit redacted "to protect the integrity of the process," with an unredacted copy to go to the court. The purchase price is blacked out in both, per the Ramudden affidavit, affirmed Oct. 21, 2026, paras. 2, 13, Exs. "A"–"B".