Canada Province of Québec District of Montréal
Total Page:16
File Type:pdf, Size:1020Kb
CANADA SUPERIOR COURT PROVINCE OF QUÉBEC (Commercial Division) DISTRICT OF MONTRÉAL _________________________________________ No.: 500-11-049079-151 IN THE MATTER OF THE RECEIVERSHIP OF: QUÉBEC LITHIUM INC., QLI MÉTAUX INC., RB ENERGY INC. AND SIROCCO MINING INC. Debtors -and- KSV KOFMAN INC. Receiver/Petitioner -and- HALE CAPITAL PARTNERS, L.P. -and- INVESTISSEMENT QUÉBEC, a legal entity having a place of business at 600, de La Gauchetière Street West, Suite 1500, Montréal, Québec H3B 4L8 -and- 9554661 CANADA INC., a corporation having a place of business at 130 Adelaide Street, Suite 3420, Toronto, Ontario M5H 3P5 -and- 2242974 CANADA INC. (formerly CONSTRUCTION PROMEC INC.), a corporation having a place of business at 1300 Saguenay Street, Rouyn-Noranda, Québec, J9X 7C3 -and- 9190-5778 QUEBEC INC., a corporation having a place of business at 82, 10th Avenue West, Amos, Québec, J9T 1W8 -and- 3391612 CANADA INC., a corporation having a place of business at 105, R.R. 2, Barraute, Québec, J0Y 1A0 - 2 - -and- LES STRUCTURES GB LTÉE, a corporation having a place of business at 105 Montée Industrielle-et-Commerciale, Rimouski, Québec, G5M 1A8 -and- 2985080 CANADA INC., a corporation having a place of business at 138 Chemin des Boisés, Val- d'Or, Québec, J9P 4N7 -and- CONSTRUCTION NORASCON INC., a corporation having a place of business at 1705, Route de l'Aéroport, CP 370, Amos, Québec J9T 3A7 -and- J.Y. MOREAU ÉLECTRIQUE INC., a corporation having a place of business at 160 boul. Industriel, Rouyn-Noranda, Québec, J9X 5C1 -and- 2950-0519 QUÉBEC INC., a corporation having a place of business at 160 boul. Industriel, Rouyn- Noranda, Québec J9X 6T3 -and- WSP CANADA INC., a corporation having a place of business at 1600 René-Lévesque West, 16th Floor, Montréal, Québec, H3H 1P9 -and- CONSTRUCTION P.B.M. INC., a corporation having a place of business at 835 av. de Granada, Rouyn-Noranda, Québec, J9X 7B3 -and- LES INDUSTRIES BLAIS INC., a corporation having a place of business at 155 Industriel Blvd., Rouyn-Noranda, Québec, J9X 6P2 -and- - 3 - BREMO INC. (doing business as REMATECH DIVISION BREMO), a corporation having a place of business at 214 Route 138, Saint-Augustin-de- Desmaures, Québec, G3A 2X9 -and- DYNAMITAGE CASTONGUAY LTÉE, a corporation having a place of business at 5939 Joyal Street, Sherbrooke, Québec, J1N 1H1 -and- 9222-0201 QUÉBEC INC. (formerly LOCATION DUMCO INC.), a corporation having a place of business at 890 LaSalle Street, Malartic, Québec, J0Y 1Z0 -and- 9208-1777 QUÉBEC INC., a corporation having a place of business at 590 3rd Avenue, Barraute, Québec, J0Y 1A0 -and- LES HUILES H.L.H. LTÉE, a corporation having a place of business at 218 McDougall Street, Maniwaki, Québec, J9E 1V6 -and- PETER SECKER, residing at 80, Front Street East, Suite 718, Toronto, Ontario, M5E 1T4 -and- RICHARD P. CLARK, residing at 1281 St. West Cordova, Suite 3001, Vancouver, British Columbia, V6C 3R5 -and- L. SIMON JACKSON, residing at 2025 – 53rd Avenue West, Vancouver, British Columbia, V6P 1L3 -and- KEVIN ROSS, residing at 1819 Avenue Creelman, Vancouver, British Columbia, V6J 1B7 - 4 - -and- KATHY LOVE, residing at 8824 Finch Court, Burnaby, British Columbia, V5A 4K5 -and- KERRY KNOLL, residing at 39, Astor Avenue, Toronto, Ontario, M4G 3M1 -and- IAN MCDONALD, residing at 401, Bay Street, Suite 2010, Toronto, Ontario, M5H 2Y4 -and- STÉPHANE BERTRAND, residing at 410 de Saint- Malo Street West, Montreal, Québec, H9C 2P6 -and- ALESSANDRO BITELLI, residing at 4002 Loraine Avenue, North Vancouver, British Columbia, V7R 4B8 -and- BRENDAN PIDCOCK, residing at 971 Hampshire Road, North Vancouver, British Columbia, V7R 1V1 -and- ROTHSCHILD INC., a corporation having a place of business at 1251 Avenue of the Americas, New York City, New York, 10020, United States of America -and- SGS CANADA INC., a corporation having a place of business at 66 Wellington Street West, Suite 4100, Toronto, Ontario, M5K 1B7 -and- SCHYAN EXPLORATION INC. / EXPLORATION SCHYAN INC., a corporation having a place of business at 203-370 Steeles Avenue West, Thornhill, Ontario, L4J6X1 -and- - 5 - THE REGISTRAR FOR THE LAND REGISTRY OFFICE FOR THE REGISTRATION DIVISION OF ABITIBI, 262, 1st Avenue East, Amos, Québec, J9T 1H3 -and- THE REGISTRAR OF THE PUBLIC REGISTER OF REAL AND IMMOVABLE MINING RIGHTS, 5700, 4th Avenue West, C 320, Québec City, Québec, G1H 6R1 -and- THE REGISTRAR OF THE REGISTER OF PERSONAL AND MOVABLE REAL RIGHTS, 1 Notre-Dame Street East, Suite 7.07, Montréal, Québec, H2Y 1B6 Mis-en-cause _________________________________________ APPLICATION FOR APPROVAL OF AN ASSET PURCHASE AGREEMENT AND FOR THE ISSUANCE OF A VESTING AND ASSIGNMENT ORDER (Section 243 of the Bankruptcy and Insolvency Act, RSC 1985, c B-3) TO THE HONOURABLE JUSTICE MARTIN CASTONGUAY OR TO ONE OF THE HONOURABLE JUDGES OF THE SUPERIOR COURT, SITTING IN COMMERCIAL DIVISION IN AND FOR THE JUDICIAL DISTRICT OF MONTRÉAL, THE RECEIVER/PETITIONER RESPECTFULLY SUBMITS AS FOLLOWS: I. INTRODUCTION A. Relief sought 1. KSV Kofman Inc. is the court-appointed receiver of Québec Lithium Inc. (“QLI”), QLI Métaux Inc. (“QLIM”), RB Energy Inc. (“RBE”) and Sirocco Mining Inc. (“Sirocco” and, collectively with QLI, QLIM and RBE, the “Debtors”), as more fully described in section IV of this Application (the “Petitioner” or the “Receiver”). 2. The Petitioner respectfully seeks approval of this Honourable Court to sell all of the Purchased Assets (as this term is defined in paragraph 107 of this - 6 - Application) of the Debtors and issuance of a vesting and assignment order in connection therewith. More specifically, the Petitioner hereby seeks the issuance of an order in the form and substance of the draft order filed in support hereof as Exhibit P-1. 3. This Application should be read in conjunction with the First Report to the Court of the Receiver dated June 13, 2016 (the “Receiver’s Report”). B. Corporate structure of the Debtors 4. The Debtors are affiliated companies, as appears from an organizational chart illustrating the basic corporate structure of the Debtors and their subsidiaries, filed in support hereof as Exhibit P-2. 5. RBE is a public company formed under the Canada Business Corporations Act, and is a successor of Canada Lithium Corp. (“CLC”), as appears from the REQ report filed in support hereof as Exhibit P-3. RBE was established to pursue the acquisition, exploration, development and mining of mineral resource properties in Canada and internationally. As of the date hereof, the shares of RBE are not listed on any stock exchange. 6. RBE currently has 16 current and former direct and indirect subsidiaries, including co-Debtors QLI, QLIM and Sirocco: (a) QLI is a company incorporated pursuant to the laws of the Province of Québec, as appears from the REQ report filed in support hereof as Exhibit P-4. QLI’s primary asset is a lithium mine and chemical processing facility located in La Corne, Québec (the “Lithium Project”). (b) QLIM is a company incorporated pursuant to the laws of the Province of Québec, as appears from the REQ report filed in support hereof as Exhibit P-5. QLIM’s sole remaining role is to guarantee certain obligations subscribed by QLI (described in section V of this Application). QLIM has no business operations, assets or employees. (c) Sirocco is a company incorporated pursuant to the laws of British Columbia, as appears from the British Columbia Company Summary report filed in support hereof as Exhibit P-6. Sirocco was established as a holding company to pursue the acquisition, exploration, development and mining of mineral resource properties internationally, in particular the production of iodine in the Aguas Blancas Project in Chile (the “Aguas Blancas Project”). 7. The Debtors maintain their separate property and assets, and were treated on a consolidated basis herein and in the CCAA Proceedings (as defined in section III of this Application) for administrative purposes only. - 7 - II. THE DEBTORS’ BUSINESS AND AFFAIRS A. The Lithium Project 8. The Lithium Project is located near La Corne, Québec, approximately 60 kilometres north of the city of Val d’Or, and consists of 12 contiguous claims covering approximately 405 hectares. 9. The Lithium Project is expected to produce battery-grade lithium carbonate to meet the rapidly growing needs of the portable consumer electronics industry, electric and hybrid-electric vehicles and storage solutions. 10. The Lithium Project had as many as nearly 250 employees. However, the process of bringing it into full production was delayed, and as a result, QLI has yet to generate any significant revenue from operations. 11. As of October 14, 2014 (being the date on which the Debtors commenced the proceedings under the Companies’ Creditors Arrangement Act (the “CCAA”) described at paragraphs 21 and following of this Application), QLI had invested approximately $350 million in the Lithium Project over the course of three years of development. 12. The Lithium Project was a significant employer in the La Corne area and the lay-off of the employees had a substantial impact on the community, as appears from an article posted on Radio-Canada’s website filed in support hereof as Exhibit P-7. B. The Aguas Blancas Project 13. Atacama Minerals Chile S.C.M. (“AMC”) is a company incorporated pursuant to the laws of Chile and is an indirect wholly-owned subsidiary of Boron Chemicals Holdings Ltd. (“Boron”), a corporation governed by the laws of Antigua and Barbuda, itself a direct wholly-owned subsidiary of Sirocco. 14. AMC’s primary business is the operation of the Aguas Blancas Project, located in the Atacama Desert, approximately 1,600 km north of Santiago, Chile. Production commenced in 2001. 15. In response to difficult market conditions, AMC reduced its production in late 2013, and decreased its work force through a series of layoffs.