MUSKOKA, Ont. -- Nine Viva Express gas stations in Ontario and one in Nova Scotia operated by VivaCorp Properties Inc. were forced to close in November by a Superior Court of Justice order that also appointed the Toronto-based firm A. Farber & Partners as interim receiver, reported The Muskoka News.
The stations closed abruptly with security personnel on site. A notice taped to the inside of the door of one of the Viva Express convenience store cites a November 1 court order that also terminated all employees of the debtors, a list of companies bearing [image-nocss] the Viva name.
According to court documents, VivaCorp Properties owes nearly $14 million to bank lenders CitiCapital Commercial Corp. and the Royal Bank of Canada. VivaCorp has been in default to CitiCapital since October 23, the documents cited by the newspaper said.
A senior representative of Farber said the order followed an application by CitiCapital, a U.S. bank, under the Bankruptcy & Insolvency Act.
The Viva companies operate a number of station properties in mainly rural locations. Eight of the stations were operated as Petro-Canadas and two as Ultramars. The company also owned one site that was to be developed into a station.
The court determined that they did not have sufficient financial resources to carry on business past November 1, or meet basic requirements such as payroll past November 1.
The court documents also indicated the board of directors of VivaCorp had requested immediate funding of $300,000 from CitiCapital to allow Viva to operate until at least November 9; however, the bank turned down the request due to company's current financial situation, said the report.
The Farber official understood the directors of Viva resigned from their positions a day or two before the court order.
As interim receivers, A. Farber & Partners will take possession and control of the properties and market them for sale to help pay back the creditors. Farber was to report back to the court, said the report, and the ultimate result will likely be that someone will own and reopen the outlets. "The end result is someone will acquire and operate the properties. That's the logical outcome," the Farber official told the paper. "The objective is to get the most we can at the minimum expense."
Click here for information on the sale.
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