ThoughtWire: the lenders' credit bid and the wage lien ahead of it

The shareholders of ThoughtWire Corp. met by videoconference on the morning of August 5, 2026 to elect a director, because the Toronto software company had gone more than nine months without one. Asked about directors' and officers' insurance, the chief financial officer, chairing, confirmed there had been none since December 2025. Josip Kozar, who had invested in 2024 and become the majority shareholder, described the pending involvement of Rahn Dodick of Dodick Landau Inc. as trustee in an anticipated notice of intention to make a proposal, then supported the motion to elect his nominee, Loreto Saccucci. Mr. Kozar held 88% of the voting shares and no other shareholder voted. Whether creditors would be offered equity for their debt was, in the minutes' words, "to be determined." A shareholder objected that no one had seconded the motion; the chair adjourned to reach counsel and that evening wrote to the shareholders that the vote stood, per the Motion Record, Aug. 28, 2026, Ex. "C", pp. 73–76 and the Affidavit of Loreto Saccucci, Aug. 27, 2026, para. 9.

Two days later ThoughtWire filed its notice of intention under s. 50.4(1) of the Bankruptcy and Insolvency Act, with Dodick Landau Inc. as proposal trustee, per the Certificate of Filing of a Notice of Intention to Make a Proposal, Aug. 7, 2026. On September 2, in the Ontario Superior Court of Justice (Commercial List), Court File No. BK-26-03408761-0031, Justice Cavanagh extended the time to file a proposal to October 20, approved a sale and investment solicitation process built around a stalking-horse bid from 1426994 Ontario Inc., the assignee of ThoughtWire's two private secured lenders' debt, and granted that same company a charge for up to $300,000 of interim financing, per the Endorsement, Sept. 2, 2026, paras. 2, 10, 16–18, 21.

Thirteen cloud subscriptions and one customer

ThoughtWire builds digital "twin" platforms, virtual models of real-life systems, for what Mr. Saccucci, now its sole director, calls smart hospitals and smart buildings, selling real-time operational intelligence, workflow automation and predictive decision support to healthcare facilities, building companies and healthcare-technology providers. Delivering them depends on thirteen distinct cloud service subscriptions. The company's assets are "primarily composed of its intellectual property," which sits in an inactive subsidiary, ThoughtWire IP Corp., per the Affidavit of Loreto Saccucci, Aug. 27, 2026, paras. 5–7, 16.

The company's account of its decline starts with the pandemic, which it says impaired its ability to win contracts, and with historical liabilities and unfavourable arrangements made under prior management, compounded by approximately $41.5 million in senior loans, $15.9 million in subordinated debentures and "mounting legal and collection pressures." An informal restructuring in 2024 brought new money from Mr. Kozar, subordinated various loans and converted most of the existing debt to equity, but operating costs remained outsized, owing primarily to an oversized workforce. In November 2025 services were interrupted over unpaid obligations to Microsoft, and the company could not agree a payment arrangement, which it says cost it a key customer in late 2025 and early 2026. "Operational cash flows during this period relied entirely on collections from that single customer, with no near-term forecasts built around securing new customer accounts," per the Affidavit of Loreto Saccucci, Aug. 27, 2026, paras. 10–14.

The trustee puts historical headcount at about forty full-time employees and approximately nineteen by late 2025, almost all of them terminated by March 2026. Through missed payrolls in 2025 and early 2026 employees "agreed to continue to work with the expectation of receiving payment later when cash flow improved," and approximately $455,000 in wages and vacation pay remains unpaid, per the First Report of the Proposal Trustee, Aug. 31, 2026, paras. 14, 20. When Hole Medical's board approved a $75,000 advance on December 15, 2025, its resolution gave the purpose as "covering the payroll for the Borrower's employees," per the Motion Record, Aug. 28, 2026, Ex. "E", p. 107. At filing three people remained, as contractors: the president, the chief financial officer and the compliance and privacy manager, per the Affidavit of Loreto Saccucci, Aug. 27, 2026, para. 22.

Two lenders, one registration day

Mr. Kozar is owed approximately $435,415.50 under a loan agreement dated December 30, 2025, and Hole Medical approximately $376,500 under one dated January 10, 2025, each secured by a general security agreement registered under Ontario's Personal Property Security Act, per the Affidavit of Loreto Saccucci, Aug. 27, 2026, paras. 17, 29. Mr. Kozar's agreement acknowledges $410,174.23 already advanced, inclusive of interest at 10%, repayable over twenty-four months. Hole Medical's made up to $350,000 available at 10%, advanced as $50,000 in January 2025, $200,000 in February 2025 and $75,000 in December 2025, all due January 10, 2026. Both security agreements are dated January 16, 2026, and both lenders registered on March 2, 2026, each citing a pari passu agreement dated January 15, 2026, per the Motion Record, Aug. 28, 2026, Exs. "D"–"F", pp. 81–83, 88, 109–115, 140–141. Hole Medical's own loan agreement, security agreement and registration style it Hole Medical Ltd.; the affidavit and the endorsement call it Hole Medical Inc.

Both registrations came after the Crown's. A financing statement in favour of His Majesty in Right of Ontario, represented by the Minister of Finance and registered for the Ministry of Labour, Immigration, Training and Skills Development, went on the register on December 11, 2024 for $6,078, and was amended on February 18, 2026 to $97,919.33 and on July 21, 2026 to $698,518, per the Motion Record, Aug. 28, 2026, Ex. "F", pp. 134–138. According to the trustee, eleven former employees made claims through the ministry for unpaid wages and vacation pay; it sent notices of claim on April 29, 2026 and registered security for them in July, per the First Report of the Proposal Trustee, Aug. 31, 2026, paras. 17–18, 21. Mr. Saccucci counts $454,997.94 owed to those eleven inside the $698,518, before any termination or severance claims. Unsecured creditors are owed approximately $2,175,000, source deductions of at least $51,248 are unpaid, and the company carries more than $4,000,000 in tax losses forward, per the Affidavit of Loreto Saccucci, Aug. 27, 2026, paras. 18, 20, 24–26, 41. Among the larger entries on the list of creditors are the Federal Economic Development Agency for Southern Ontario, at $200,355, and Microsoft Canada Inc., at $173,012.15, per the Motion Record, Aug. 28, 2026, Ex. "G", pp. 146–147.

The numbered company

When the lenders stopped funding, they told the company they would provide interim financing if it filed a notice of intention "centered on sale and investment solicitation process," and said they were interested in "acquiring the business through a stalking horse process or recouping the secured funds advanced to the Company," per the Affidavit of Loreto Saccucci, Aug. 27, 2026, paras. 30–32. On August 26 they assigned their debt and security to 1426994 Ontario Inc., which the company understands they own jointly. The numbered company's signatory on the stalking-horse agreement and the interim-financing term sheet is Frank Kordy, one of three directors named on Hole Medical's December 2025 board resolution, per the Motion Record, Aug. 28, 2026, Ex. "I", s. 1.1(lll), p. 195, Ex. "E", p. 107 and Ex. "K", p. 222.