Comark completes sale transaction and emerges from creditor protection

On June 3, 2020, Comark Holdings Inc. and its subsidiaries (collectively, “Comark”), a leading specialty fashion retailer serving customers through the Ricki's, cleo and Bootlegger banners, sought and obtained protection from their creditors pursuant to an Initial Order from the Ontario Superior Court of Justice (Commercial List) under the Companies’ Creditors Arrangement Act (“CCAA”). Comark commenced proceedings under the CCAA in response to a challenging retail environment that worsened due to the COVID-19 pandemic and with the objective of restructuring its business and operations by optimizing its store footprint and leasing costs. As part of the CCAA proceedings, Comark also obtained the court’s authorization to conduct a process to solicit proposals for sale or investment transactions involving the company.

On August 7, 2020, Comark emerged from CCAA protection by completing a sale transaction for its business with an entity controlled by Comark’s principal shareholder. The sale transaction allows Comark to move forward with each of its banners and 282 of its stores across Canada and was overwhelmingly supported by Comark’s lenders, landlords, employees and vendors.

Osler, Hoskin & Harcourt LLP advised Comark with a team consisting of Tracy Sandler, Martino Calvaruso, Sean Stidwill and Justin Kanji (Insolvency and Restructuring), John MacDonald, Karin Sachar and Sarah McLeod (Litigation), Paul Morassutti, Matthew Richie and Jordan Adler (Real Estate), Greg Wylie (Tax), Sven Poysa (Employment), Shelley Obal and Mary Angela Rowe (Research) and Miju Damodar (Financial Services).