Novo Textile: a receiver for an N95 maker and two Port Coquitlam strata units

On October 13, 2026, Justice Veenstra of the Supreme Court of British Columbia appointed Deloitte Restructuring Inc. receiver and manager of Novo Textile Company Ltd., which Deloitte's notice describes as "a Health Canada-licensed manufacturer of medical masks and N95 respirators, supplying primarily provincial health authorities and medical supply distributors," from leased premises at 105 – 10 King Edward Street in Coquitlam. The appointment, made under s. 243(1) of the BIA and s. 39 of the Law and Equity Act on National Bank of Canada's petition, reaches three more companies: Novo Holdings Co. Ltd., a holding company and a shareholder of Novo Textile, and Zanatta Seaborne Holdings Ltd. and Zanatta Seaborne 2 Holdings Ltd., each the registered owner of one strata unit on Seaborne Avenue in Port Coquitlam, per the Receivership Order, Oct. 13, 2026, p. 1 and para. 2 and the Notice and Statement of the Receiver, Oct. 22, 2026, paras. 1–2, 6(a)–(b).

The bank's petition, dated August 31, claims a combined $9,555,207.24 as of August 28, plus interest and costs, per the Petition, Aug. 31, 2026, Part 1, para. 22. It was heard on September 25 and October 1, with counsel appearing for the four companies and for two guarantors, a trust and an individual, and judgment was reserved to October 13, per the Receivership Order, Oct. 13, 2026, p. 1 and Sched. "A". Deloitte took possession and control of the property the same day, its notice says, per the Notice and Statement of the Receiver, Oct. 22, 2026, para. 5.

Lending against masks and receivables

The bank's first affidavit was affirmed on August 31 by a senior director in its special loans group. Under a letter agreement of October 30, 2024, the bank made available to Novo Textile a line of credit with an approved limit of $2,800,000 for day-to-day operations, a non-revolving special credit of $3,870,000 to repay pre-existing equipment loans, a derivatives line and a Mastercard. Under letter agreements of October 18, 2024, the two strata-unit companies each took a term loan to repay pre-existing debt: $1,201,000 for Zanatta Seaborne Holdings and $1,985,000 for Zanatta Seaborne 2, per the NBC affidavit #1, Aug. 31, 2026, paras. 1, 4, 8, 11 and the Petition, Aug. 31, 2026, Part 2, paras. 2, 4, 6. At August 28 the bank put the line at $2,834,502.08, the special credit at $3,475,000.86, the Mastercard at $45,460.07, and the two term loans at $1,201,147.31 and $1,999,096.92, per the NBC affidavit #1, Aug. 31, 2026, para. 18.

The security is dated November 14, 2024: a general security agreement from each of the four companies, a first mortgage and assignment of rents on each strata unit, unlimited guarantees running between the companies, and guarantees from the trust and the individual of each borrower's debts up to set limits, the highest of them $1,610,000 each for Novo Textile's, per the Petition, Aug. 31, 2026, Part 1, paras. 1–6, 9–20 and Part 2, para. 10. Deloitte's summary is that the bank's debt is "cross-guaranteed and cross-collateralized among the Debtors," per the Notice and Statement of the Receiver, Oct. 22, 2026, para. 6(d), note (1).

The line is a borrowing-base facility, the affidavit explains, its limit "calculated as a percentage of the value of eligible accounts receivable and inventory." Novo Textile's inventory, the affidavit says, "is comprised primarily of surgical and N95 masks and some packaging." The last receivables information the bank had, as of March 31, 2026, showed two customers, one of them BC Provincial Health Services Authority, which Novo Textile's originating credit submission described as its primary customer "pursuant to a contract in place until January 2027 with monthly minimum order commitments." Most of the equipment is classified as shop equipment, which the bank understands to be "high-speed medical mask and N95 production machines that are highly specialized and may have a limited resale market," per the NBC affidavit #1, Aug. 31, 2026, paras. 25–27, 29–30.

Missed payments, and a year of share deals

According to the affidavit, Novo Textile has failed to make required monthly payments on the line since April 27, 2025 and on the special credit since October 1, 2025; Zanatta Seaborne 2 since October 28, 2025; Zanatta Seaborne Holdings since December 1, 2025. Each made lump-sum payments in May 2026, and the affidavit says there have been none since. It counts further defaults: $80,471.17 of 2025 and 2026 property taxes owing on the two units at June 5, 2026; required financial reporting not delivered, including annual statements for the 2025 fiscal year; insurance policies for the units that expired on April 1, 2026 and did not extend to the Zanatta Seaborne 2 unit; a general security agreement registered by Vancouver City Savings Credit Union against the two strata-unit companies; and a Crown charge for employer health tax against Novo Textile, per the NBC affidavit #1, Aug. 31, 2026, para. 14. The receiver's notice records the companies' answer on the Vancity registration: they "have advised that the registration was made in error and that no funds have been advanced," and Deloitte is seeking confirmation of any amount owing, per the Notice and Statement of the Receiver, Oct. 22, 2026, para. 6(d), note (4).

The bank sent demands for repayment and notices of intention to enforce security by letters dated July 6, 2026, with concurrent demands under the guarantees. It "offered forbearance terms, but no agreement was reached," the affidavit says, and on August 14 it registered crystallized floating charges against the two units, per the NBC affidavit #1, Aug. 31, 2026, paras. 15–17.

Behind the demands the affidavit sets out a year of proposed share transactions, each reported to the bank by Novo Textile's chief executive, whose March 2 and June 12 emails are signed "CEO | President". A transaction first reported on October 1, 2025, to pay out the line and the special credit by October 31, was still being negotiated on November 25. On March 2, 2026, the chief executive sent a signed share purchase agreement under which 1567420 B.C. Ltd. would acquire 64% of Novo Textile's shares, closing March 17, and which, the bank was told, would fully repay the line, the special credit and taxes for 2026. "The transaction did not complete, and National Bank was not repaid," the affidavit says. On June 12 came a non-binding letter of intent for 54 North Asset Management Ltd. to acquire all of Novo Textile's shares, with a target closing of June 30 that the chief executive acknowledged would realistically be July 15, and commercial mortgages from Vancity to be funded in parallel to repay the two term loans, per the NBC affidavit #1, Aug. 31, 2026, paras. 41–44 and Exs. "44", "46".

The bank's affiant wrote to the chief executive on June 18 that "the Bank does not share the view the Company has in that a transaction to fully pay out the Bank is imminent," per the NBC affidavit #1, Aug. 31, 2026, Ex. "46". On July 6 the borrowers' solicitor forwarded to the bank's counsel an email from their financing advisor saying the Vancity mortgages had been reapproved, "so the financing is in place to takeout the National debt against these properties when the Novo sale closes." On July 7 the solicitor wrote that the share purchase agreement with 54 North remained under negotiation, that a mid-July closing could not be guaranteed, and that the borrowers anticipated "using part of the purchase price proceeds and Vancity financing to pay off the NBC indebtedness in full," per the NBC affidavit #1, Aug. 31, 2026, Ex. "47". By the end of August the bank's affirmed position was that "the inordinate amount of time a share transaction has been under negotiation, the continually shifting closing dates," and what it calls an apparent inconsistency in the borrowers' plan for the commercial mortgages left it with "serious doubts as to the viability of the current transaction," per the NBC affidavit #1, Aug. 31, 2026, paras. 45–47.