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SFG Parent completes reorganization

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SFG Parent, Inc.

Specialty Foods Group Income Fund, a cross-border income trust, went public in 2003 at $10 per unit. Due to financial reverses, it was forced to restructure in 2006. That restructuring failed to produce a viable ongoing Income Fund such that, when the units were ultimately cease traded in 2009, they had a market value of only about a half cent each. After many years of complex internal reorganizations, debt repurchases and restructurings, in January 2017 a plan of arrangement was proposed to restructure and simplify the very complex ownership structure of the Income Fund and the entities in which it had a direct or indirect ownership interest. That plan was approved by the court in March. As a result, unit holders received an immediate cash distribution of approximately $0.89 per unit and are expected to receive future distributions. The Plan of Arrangement was effected under the Business Corporations Act (Ontario) in combination with the Trustee Act (Ontario). Court orders were obtained and reorganizations were effected in Canada and the US with the result that, among other things, economic entitlements were revised, distributions of funds were approved, Canadian and US tax issues were addressed, a number of claims (including for interest arrears and for reimbursement of inter corporate amounts) were compromised, releases were exchanged and the right of holders of securities to exchange those securities was terminated. Fasken Martineau acted as counsel to the applicants and was primarily responsible for the Canadian aspects of the restructuring. Justice Wilton-Siegel when approving the final court order described the Plan of Arrangement as one of the most complicated that he had ever seen. Fasken Martineau’s team was led by Jon Levin and included Jessica Catton Rinaldi, Will Shaw and David Steinhauer (Corporate), Aubrey Kauffman and Murray Braithwaite (Litigation) and Bill Bies (Tax).



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