US Air Compressor: a 50/50 deadlock, a receiver and $34,000 in the bank

US Air Compressor sells air compressors built in China and covered by a ten-year bumper-to-bumper warranty, which Justice Myers called "not just a catchy marketing tool": it binds a customer to buying parts and service from the business for a decade, per the Endorsement of Justice Myers, July 28, 2026, paras. 8, 10. The business was started by Stephen Gilbertson's family in the early 1950s and now runs through two companies, each owned half and half. Mr. Gilbertson and DK Kuzucan each hold 50% of United States Air Compressor Incorporated; Mr. Gilbertson and DK's father, Bora Kuzucan, each hold 50% of US Air Compressor (Canada) Inc., per the Endorsement, paras. 1–3, 9. By the summer of 2026 one side had stopped paying, the other had stopped shipping, and "the business has effectively ground to a halt," per the Endorsement, paras. 40–42.

On July 28, 2026, in the Ontario Superior Court of Justice (Commercial List), Court File No. CL-25-00753596-0000, Justice Myers appointed TDB Restructuring Limited receiver and manager of the Canadian company under s. 241 of the Canada Business Corporations Act and s. 101 of the Courts of Justice Act, and directed that the order be drawn without any charge priming existing security. The formal order is dated August 12, 2026. TDB took possession that day and found approximately $34,000 in the company's bank accounts, per the Order (Appointment of Receiver), Aug. 12, 2026, para. 2 and the Motion Record for Receiver's Charge, Aug. 31, 2026, Tab 2, para. 9. At TDB's request, the applicants now ask for the charges the order left out, per the Factum of the Moving Parties, Aug. 31, 2026, para. 1.

One business on both sides of the border

Bora Kuzucan joined Mr. Gilbertson years ago, bringing engineering and management expertise to a partner whose focus was sales. After immigration problems in the United States he settled in Montreal, and the two incorporated the Canadian company to buy the Chinese-made machines; Mr. Kuzucan moved his US shares to his son and took half of the new company. The US company pays the Chinese vendors in advance and books the price as an intercompany loan owed by Canada. The Canadian company imports the units, makes the few bound for Canadian customers CSA-compliant, works the rest enough to satisfy US import or tariff restrictions, performs warranty labour, and delivers to the US company's customers, who pay the US company. More than 80% of sales go through Mr. Gilbertson. Both sides concede there is no agreement on how the profit left after the manufacturer is repaid is divided, per the Endorsement, paras. 11–15, 18–23. A due diligence list dated June 2, 2026 puts the Canadian company's office and warehouse in Burlington, Ontario, with an external warehouse in Montréal-Est, per the Motion Record, Aug. 31, 2026, Tab 2, Ex. C, p. 75.

Their shareholders' agreement of January 26, 2023 bars competition, and s. 12 governs funding: if all shareholders resolve in writing that the company needs money, they lend it pro rata and interest-free, and if fewer than all contribute, those who do earn interest at a reasonable commercial rate, per the Motion Record, Aug. 31, 2026, Tab 2, Ex. C, pp. 130, 133.

The falling-out came late in 2025. The Kuzucans say they found accounts Mr. Gilbertson was using to divert money from the US company; he cut Bora Kuzucan off from its bank accounts; Mr. Kuzucan incorporated a Delaware company in the US company's name and told customers to pay it instead, which he says was to protect the business from tax exposure. On December 1, 2025 Justice Myers appointed an interim manager over both companies and enjoined the Kuzucans from diverting US sales and payments, per the Endorsement, paras. 26–35. That manager was discharged in late February 2026. Mr. Gilbertson has let no money flow from the US company to Canada since the litigation began, and the Kuzucans will not ship compressors from Canadian warehouses unless demands for "very substantial payments" are met; according to the endorsement they "may have" sold some $400,000 of inventory cheaply to a distributor, and the Canadian company now sells a different compressor under an "Air Compressors Canada" banner, per the Endorsement, paras. 39–46.

The bank, the guarantee and a general security agreement

After the July 6 hearing, the applicants learned that on April 13, 2026, Royal Bank of Canada, through Aird & Berlis LLP, had demanded CAD $133,807.88 plus USD $13,758.52 from the Canadian company under an operating facility, an auto loan and two credit card facilities, delivered a notice of intention to enforce security under s. 244(1) of the BIA, and made demand on Mr. Kuzucan under his guarantee, limited to a principal sum of $600,800, per the Motion Record, Aug. 31, 2026, Tab 2, Ex. C, paras. 3–4, and Ex. D, Ex. 1, pp. 154–157.

Mr. Kuzucan's affidavit sworn July 20, 2026 says RBC made demand "because of concerns with the viability of USACC based on the proceedings commenced by Steve in Ontario," that the company could not pay, and that he honoured his guarantee, took an assignment of RBC's debt and security under the Mercantile Law Amendment Act, and put $30,000 of his own money in escrow with the bank. RBC's payout letter of May 28, 2026 fixes the payout at $98,471.16, including that $30,000 and $18,109.23 of the bank's legal fees, per the Motion Record, Aug. 31, 2026, Tab 2, Ex. D, paras. 2–4 and p. 161.

On June 9, 2026, registrations filed through Gowling WLG recorded the assignment of two RBC financing statements to Mr. Kuzucan and a new one naming him secured party against the company. The general security agreement behind it is signed by Mr. Kuzucan twice: for US Air Compressor (Canada) Inc. as its director, and in his own name as secured creditor. It recites advances of approximately $810,748.49 as at May 28, 2026, "due and payable," and a promise to forbear until July 31, 2026 and keep funding the company, "on the condition that all of the past and future obligations owed to the Secured Creditor by the Debtor, including the Current Shareholder Loan, are secured," per the Motion Record, Aug. 31, 2026, Tab 2, Ex. C, pp. 91–92, 112, 121–124. Justice Myers noted that Mr. Kuzucan had originally claimed a much higher shareholder loan and had apparently accepted $800,000 after an accountant's review, per the Endorsement, para. 97.

"Without the RBC facilities, USACC had no way of financing its operations or paying its employees," Mr. Kuzucan says, and it needed an operating facility he could not provide. He lists four factoring agreements, each with his personal guarantee: Merchant Growth on February 25, 2026, CCP Advance Inc. (Canacap) on March 11, Forward Funding on April 13 and BizFund on May 25. "All funds were used to pay operating costs," per the Motion Record, Aug. 31, 2026, Tab 2, Ex. D, paras. 6–10. Each is a purchase of future receipts: Merchant Opportunities Canada Limited Partnership paid $150,000 for $192,300 of receipts, Canacap $110,000 for $149,050, Forward Funding $50,800 for $68,580, and BizFund $70,000 for $98,000, per the Motion Record, Aug. 31, 2026, Tab 2, Ex. D, pp. 172, 191, 194, 206. Canacap registered against the company on July 7, 2026, the day after the hearing.