Ontario Superior Court of Justice Commercial List
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Court File No. CV-18-602745-00-CL ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST BETWEEN: ASTRAZENECA CANADA INC. Plaintiff - and - SAMEH SADEK also known as SAM SADEK, ST. MAHARIAL PHARMACY INC. dba MD HEALTH PHARMACY, ST. MAHARIAL CLINIC INC., SRX INVESTMENT INC., SHEPHERD RX PHARMACY INC. and LILIAN FAM Defendants MOTION RECORD (Returnable November 29, 2018) AIRD & BERLIS LLP Date: November 20, 2018 Barristers and Solicitors Brookfield Place Suite 1800, Box 754 181 Bay Street Toronto, ON M5J 2T9 Ian Aversa (LSUC # 55449N) Tel: (416) 865-3082 Fax: (416) 863-1515 Email: [email protected] Kyle Plunkett (LSUC # 61044N) Tel: (416) 865-3406 Fax: (416) 863-1515 Email: [email protected] Shakaira John (LSUC # 72263D) Tel: (416) 865-4637 Fax: (416) 863-1515 Email: [email protected] Lawyers for Alvarez & Marsal Canada Inc., in its capacity as the court-appointed Receiver of Sameh Sadek also known as Sam Sadek, et ah Index Court File No. CV-18-602745-00-CL ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST BETWEEN: ASTRAZENECA CANADA INC. Plaintiff - and - SAMEH SADEK also known as SAM SADEK, ST. MAHARIAL PHARMACY INC. dba MD HEALTH PHARMACY, ST. MAHARIAL CLINIC INC., SRX INVESTMENT INC., SHEPHERD RX PHARMACY INC. and LILIAN FAM Defendants INDEX TAB DOCUMENT 1 Notice of Motion dated November 20, 2018 2 Second Report of the Receiver dated November 20, 2018 Appendix A First Report of the Receiver dated October 9, 2018 Appendix B Order of Justice McEwen dated October 17, 2018 Appendix C Acknowledgement of Receipt and Release of Personal Items dated November 9, 2018 Appendix D Redacted copy of the Agreement of Purchase and Sale dated October 24, 2018 Confidential Agreement of Purchase and Sale dated October 24, 2018 Appendix 1 3 Draft Order (Ancillary Relief) TAB DOCUMENT 4 Draft Approval and Vesting Order 5 Blackline of Approval and Vesting Order against Model Order 6 Service List Tab 1 Court File No. CV-18-602745-00-CL ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST BETWEEN: ASTRAZENECA CANADA INC. Plaintiff - and - SAMEH SADEK also known as SAM SADEK, ST. MAHARIAL PHARMACY INC. dba MD HEALTH PHARMACY, ST. MAHARIAL CLINIC INC., SRX INVESTMENT INC., SHEPHERD RX PHARMACY INC. and LILIAN FAM Defendants NOTICE OF MOTION (returnable November 29, 2018) Alvarez & Marsal Canada Inc. (“A&M”), in its capacity as the Court-appointed receiver (in such capacity, the “Receiver”), without security, of the assets, undertakings and properties of Sameh Sadek (also known as Sam Sadek), St. Maharial Pharmacy Inc. dba MD Health Pharmacy, St. Maharial Clinic Inc., SRX Investments Inc., Shepherd RX Pharmacy Inc. and Lilian Fam (collectively, the “Defendants”), will make a motion to a judge presiding over the Commercial List on Thursday, November 29, 2018 at 10:00 a.m., or as soon after that time as the motion can be heard, at 330 University Avenue, Toronto, Ontario. PROPOSED METHOD OF HEARING: The motion is to be heard orally. 1. THE MOTION IS FOR, amongst other things, one or more Orders: (a) if necessary, abridging the time for service and filing of this notice of motion and the motion record or, in the alternative, dispensing with same; -2- (b) approving the sale transaction (the “Transaction”) contemplated by an agreement of purchase and sale between the Receiver, as seller, and Summer Wind Homes Inc. (“Summer Homes”), as buyer, dated October 24, 2018 (the “Purchase Agreement”); (c) approving the Receiver’s execution of the Purchase Agreement and authorizing the Receiver to execute all other ancillary documents and agreements required to complete the Transaction; (d) vesting in Summer Wind Developments Inc. (the “Purchaser”), in accordance with the written direction of Summer Homes, Lilian Fam’s right, title and interest in and to the real property municipally known as 8 Calico Court, Halton Hills, Ontario (the “Real Property”) free and clear of all liens, charges and security interests and other encumbrances; (e) approving the Second Report of the Receiver dated November 20, 2018 (the “Second Report”) and the actions and activities of the Receiver set out therein; (f) approving the Receiver’s Interim Statement of Receipts and Disbursements for the period September 11, 2018 to November 16, 2018; and (g) sealing the unredacted copy of the Purchase Agreement, attached as Confidential Appendix 1 to the Second Report, until the completion of the Transaction or further Order of this Court; and (h) such further and other relief as counsel may request and this Court deems just. 2. THE GROUNDS FOR THE MOTION ARE: Appointment Order and Powers (a) pursuant to the Order of the Honourable Mr. Justice Dunphy dated September 11, 2018 (as amended and restated by Order of the Honourable Mr. Justice McEwen dated October 17, 2018, the “Appointment Order”), A&M was: (i) appointed as the Receiver, without security, of all of the assets, undertakings and properties of -3- the Defendants, including all proceeds thereof to the extent that such assets, undertakings and properties are located in Canada (the “Domestic Property”); and (ii) empowered and authorized, but not obligated, to act at once in respect of all of the assets, undertakings and properties of the Defendants, including all proceeds thereof to the extent that such assets, undertakings and properties are located outside of Canada (the “Foreign Property” and, together with the Domestic Property, the “Property”); (b) the circumstances leading up to the Receiver’s appointment are summarized in the First Report of the Receiver dated October 9, 2018, filed in these receivership proceedings (the “First Report”); (c) pursuant to the Appointment Order, the Receiver was empowered and authorized to market any or all of the Domestic Property, including soliciting offers in respect of the Domestic Property and negotiating such terms and conditions of sale as the Receiver, in its discretion, deems appropriate; (d) the Debtor was a resident of the Province of Ontario and the owner of the Real Property; Termination of Original Sale Transaction for 8 Calico Court (e) as set out in the Second Report, the Receiver sought and obtained an Order from this Court on October 17, 2018, among other things, authorizing the Receiver to complete the sale of the Real Property to Mr. Shawn Zarb (the “Original Purchaser”) as contemplated by an agreement of purchase and sale dated September 17, 2018 (as amended, the “Original Purchase Agreement”) entered into between the Debtor, as seller, and the Original Purchaser, as purchaser; (f) the transaction under the Original Purchase Agreement was scheduled to close on October 18, 2018 (the “Original Sale Transaction”); (g) the Original Sale Transaction did not close as the Original Purchaser failed to secure sufficient financing to satisfy the purchase price; - 4 - (h) as a result of the breach, and after discussions with the real estate broker regarding alternative purchasers, the parties agreed to mutually terminate the Original Purchase Agreement concurrently with the Receiver and the Purchaser entering into the Purchase Agreement; Sale Transaction re 8 Calico (i) following the termination of the Original Purchase Agreement, the Receiver negotiated a new transaction whereby Summer Homes would acquire the Real Property on essentially identical terms as those agreed to under the Original Purchase Agreement; (j) the Purchase Agreement contemplates that the Receiver will complete the Transaction and the Real Property will be vested in the Purchaser; (k) the only remaining conditions under the Purchase Agreement is the Court granting the proposed Approval and Vesting Order and receipt by the Receiver of the balance of the Purchase Price; (l) given the terms and price are the same as the Original Purchase Agreement, the Receiver is of the view that the purchase price contemplated in the Purchase Agreement represents a fair price for the subject property; (m) the Receiver believes that it is in the best interests of the Defendants’ stakeholders if the Transaction closes and net proceeds are delivered to the Receiver; (n) a sealing order is required because the Confidential Appendix 1 contains certain commercially sensitive information, such as the purchase price, the release of which could prejudice the Defendants’ stakeholders, particularly if the Transaction does not close; (o) this Court previously granted a sealing order in respect of the commercially sensitive terms of the Original Purchase Agreement subject to the same terms; -5- Activities of the Receiver (p) the Receiver has filed with the Court its Second Report outlining, amongst other things: (i) the activities of the Receiver and its counsel, A&B, since the date of First Report; (ii) the Real Property, the Sale Agreement and the Transaction; and (iii) the results of its realization and recovery efforts to date; (q) the Receiver’s activities have been reasonable and responsible in accordance with the Receiver’s mandate as provided by the Appointment Order; (r) the other grounds and facts set out in the Second Report; (s) the inherent and equitable jurisdiction of this Court; (t) the terms of the Appointment Order; (u) the provisions of the Courts of Justice Act, R.S.O. 1990, c. C.43, as amended; (v) rules 1.04, 1.05, 2.01, 2.03, 3.02, 16, 17 and 37 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, as amended; and (w) such further and other grounds as counsel may advise and this Court may permit. 3. THE FOLLOWING DOCUMENTARY EVIDENCE will be used at the hearing of the motion: (a) the Second Report; and (b) such further and other material as counsel may submit and this Court may permit. -6- Date: November 20, 2018 AIRD & BERLIS LLP Brookfield Place 181 Bay Street, Suite 1800 Toronto, Ontario M5J 2T9 Ian Aversa (LSUC # 55449N) Tel: (416) 865-3082 Fax: (416) 863-1515 Email: [email protected] Kyle Plunkett (LSUC # 61044N) Tel: (416) 865-3406 Fax: (416) 863-1515 Email: [email protected] Shakaira John (LSUC # 72263D) Tel: (416) 865-4637 Fax: (416) 863-1515 Email: [email protected] Lawyers for Alvarez & Mar sal Canada Inc., in its capacity as the court-appointed Receiver of Sameh Sadek also known as Sam Sadek, et al.