Gandinnovations Enters Court-Monitored Restructuring

In a letter dated May 13, Mark Kossak, vice president of operations of Gandi Innovations LLC, informed the company’s suppliers of a filing in the Ontario Superior Court of Justice under the Companies’ Creditors Arrangement Act.

The letter reads as follows:

“Our suppliers are critical to our ability to continue to serve the needs of our customers. Accordingly, we want to let you know about an important step Gandi has taken to maximize the value of its business for stakeholders, including its valued suppliers. On May 8, the Ontario Superior Court of Justice issued an Initial Order under the Companies’ Creditors Arrangement Act (CCAA) allowing Gandi to restructure its affairs under a court supervised process. The Initial Order appointed BDO Dunwoody Limited (BDO) as Monitor during the CCAA proceedings.

“The CCAA allows companies, like Gandi, that are experiencing financial difficulty to avoid liquidation, continue operating and restructure their corporate affairs. The Initial Order does this by providing for a stay of proceedings. During the stay period creditors will not be able to engage in any collection actions and no one will be able to terminate any contracts with the company, without first getting permission of the court. The Monitor, a licensed restructuring professional and an independent third party approved and appointed by the court, will closely monitor the company and assist Gandi in completing their restructuring. We expect to complete this process by the end of August.

“Gandi will pay all the bills it incurs in the CCAA proceedings. The Initial Order requires Gandi to pay all amounts owing to suppliers, service providers and any other creditor arising after Gandi’s CCAA filing and Gandi has budgeted for adequate cash to do so. Gandi’s lender supported its application under the CCAA and will continue to work with us during the course of the proceedings. Our CCAA proceedings are well planned, well financed and well organized.

“Unfortunately, by the terms of the Initial Order, at this time Gandi is not permitted to pay suppliers for amounts owed to suppliers prior to the filing date of May 8. It is not necessary to file proof of claim or any document evidencing debts that are owed to you at this time. Court approvals will be obtained before any distribution is made to creditors.

“We thank you for your patience and ask for your continued support during this process. We will do out best to keep you fully informed of our progress. If you have any questions please feel free to contact your regular Gandi representative or the representative from BDO, Eugene Migus (905) 615-6201 or Juergen Manski at (416) 865-0210. For access to certain court documents and other information about the CCAA proceedings, please visit www.bdo.ca/gandi.”