Inscape, in Trouble, Files for CCAA Protection

Inscape Corporation, a publicly-held corporation listed on the Toronto Stock Exchange, announced Friday that the company and its subsidiaries, Inscape Inc. ("INI") and Inscape (New York) Inc. ("Inscape NY" and together with Inscape and INI, "Inscape Group") have initiated proceedings in the Ontario Superior Court of Justice under the Companies' Creditors Arrangement Act (aka "CCAA").

More than 80 unionized workers arrived to work Friday morning to find out they were on permanent layoff.

The Inscape Group's application under the CCAA was heard Friday morning. Following the hearing, the Court granted an order, which, among various other relief: (i) grants a stay of proceedings in favor of Inscape Group up to and including January 20, 2023 (aka the "Initial Stay Period"); and (ii) appoints Alvarez and Marsal Canada Inc. ("A&M") as court-appointed monitor of Inscape Group.

After careful consideration of all available alternatives following thorough consultation with legal and financial advisors, the board of Inscape Group determined that it is in the best interests of Inscape Group and all of its stakeholders to seek creditor protection under the CCAA.

IIROC immediately made a decision to impose a temporary suspension (halt) of trading in Inscape shares. IIROC is Canada’s self-regulatory organization which oversees all investment dealers and trading activity on debt and equity marketplaces in Canada.

Inscape Group said they initiated the CCAA Proceedings in order to, among other things, obtain a stay of proceedings that will allow Inscape Group to determine the best path forward to effect an orderly and efficient process for the liquidation of the Company's assets. Inscape Group is scheduled to return to the Court for a hearing (the "Comeback Hearing") on January 20, 2023.

During the Initial Stay Period, the Company intends to begin working closely with the Monitor to facilitate the development of an orderly process designed to maximize the value of its assets, for the benefit of its creditors and other stakeholders.

In a statement to CTV News, East Gwillimbury, Ontario Mayor Virginia Hackson noted, "Inscape has been a key employer in our community and has had a strong relationship with the town. Our team has reached out to their owners to provide support where possible with this transition."

For more information on what the CCAA action means, CLICK HERE.