Toronto-based Trees Corp. (CBOE: TREE) and its subsidiaries filed for creditor protection under the Canadian Companies’ Creditors Arrangement Act.
The CCAA is similar to U.S. bankruptcy protection.
In its latest financial statements, which were for the quarter ended Sept. 30, the company reported C$280,403 cash on hand and total liabilities of C$13.5 million.
After the deal collapsed, the board of directors said it planned to “undertake a comprehensive review” of its operations and engaged an outside financial advisor in that review, according to a statement form the company.
“After careful consideration of all available alternatives, and consultation with legal and financial advisors, the directors of the Trees Group determined that it was is in the best interests of the Trees Group to file an application for creditor protection under the CCAA,” it said.
The initial order includes, among other things:
- A stay of proceedings in favor of the Trees Group
- The appointment of Ernst & Young Inc. as the monitor of the Trees Group
The Trees Group plans to work with the monitor to develop a plan to streamline its operations and “conduct a court-supervised sales process to obtain a going concern solution for its operations and maximize the value of the Trees Group’s assets for the benefit of its stakeholders.”
Subsidiaries covered by this protection order include:
- Ontario Cannabis Holdings Corp.
- Miraculo Inc.
- 2707461 Ontario Ltd.
- OCH Ontario Consulting Corp.
- 11819496 Canada Inc.
The Cboe is expected to conduct a delisting review of the company in the near future.