Key Points:

• Relief Sought: The Applicants (Pride Group Holdings Inc. and affiliates) requested approval of:

  • A Wind-down, Liquidity Contribution, and Turnover Order.
  • Extension of stay of proceedings and a Key Employee Retention Plan (KERP).

• Context:

  • Pride Entities needed $40 million to execute a wind-down. The initial funding plan, which required lenders to contribute, was rejected.
  • The new plan involves selling inventory to generate liquidity, allowing Recourse Lenders the option to fund their share or allow sales of secured collateral.

• Court’s Decision:

  • Approved the Turnover Order, permitting inventory sales by Nations Capital LLC to fund the wind-down. Secured creditors may either contribute or retrieve their collateral if obligations are met.
  • Extended the stay of proceedings to March 31, 2025, and approved a $1.8 million KERP to retain key employees.

• Legal Basis:

  • Relief granted under section 11 of the Companies' Creditors Arrangement Act (CCAA) to support good faith efforts and maximize creditor recoveries.

• Rationale:

  • The revised plan prevents forcing lenders to contribute involuntarily while ensuring an orderly liquidation to benefit stakeholders. The KERP was necessary to retain essential personnel for the complex asset turnover.

Conclusion: Orders were granted to support an efficient wind-down and extend the stay for successful implementation. No monetary award specified.