An investigation into millions of dollars in dividend payments to Sears Canada shareholders while the company was in decline could soon lead to court action.
On Nov. 19, the court-appointed monitor for the retailer’s insolvency will seek permission from Ontario Superior Court to initiate proceedings against Eddie Lampert and his U.S. hedge fund, ESL Investments, in connection to $509 million paid to Sears shareholders in 2013.
In its notice of motion, the monitor, FTI Consulting, says it has identified « unresolved concerns » over the dividend payments. Of particular concern, it says, was the apparent limited analysis that informed the decision, which was made at a time when Sears was facing « worsening financial results, » and ESL appeared « to have had an urgent liquidity need. »
Eddie Lampert is chair of Sears Holdings in the U.S. and ESL Investments. (Sears Holdings)
The monitor also claims there is evidence Lampert and two then-Sears Canada directors « significantly influenced » the dividend payout decision.
The two former directors, William Harker and William Crowley, are also named in the potential proceedings. They each had close links to ESL and Lampert, according to the court documents.
Harker and Crowley’s lawyers declined to comment.
None of the allegations in the notice of motion has been proven in court.
ESL, of which Lampert is chair and CEO, said the 2013 dividend payments were authorized by Sears Canada’s board of directors at a time when no ESL executives were members and the retailer was clearly solvent.
« We believe there is no legal basis to reclaim those dividends and any attempt to do so would be without merit, » ESL spokesperson Michael Mittelman said.
Look into it
The investigation into dividend payouts began in January, when the monitor announced it was reviewing $611 million the company paid to Sears Canada shareholders in 2012 and 2013.
Next, Sears Canada retirees and other creditors asked Ontario Superior Court to scrutinize nearly $3 billion paid to Sears shareholders between 2005 and 2013.
That could be a great thing for the pensioners, fantastic thing. – Sears Canada pensioner Ron Husk
The retirees’ aim was to recover some of the money to top up their pension payments, which have been reduced by 20 per cent because of a shortfall in the Sears pension fund.
« That’s why we wanted an investigation, » said Ken Eady, vice-president of the Sears Canada Retiree Group (SCRG), a volunteer organization representing retirees.
« We wanted to find out if there was money there that should have been ours. »
According to court documents, both the monitor and the litigation investigator recommend proceeding with claims related to the 2013 payouts.
When Sears paid $753 million in dividends in 2010, the approval process « appears to have been robust, » the monitor says. The process included management presentations and meetings with outside lawyers to review the plan, according to court documents.
In 2013, on the other hand, « the board and management devoted significantly less time and analysis » to the process with « limited » correspondence.
FTI Consulting also noted that in 2010, Sears Canada had an operating profit of $196.3 million, but in 2013, it was operating at a loss of $187.8 million.
An undervalued transfer
Based on its findings, the monitor says it believes there’s a reasonable basis for the court to consider whether the 2013 dividend payments represent a « transfer at undervalue » under Canada’s Bankruptcy and Insolvency Act.
« Generally, transfer at undervalue would mean the company is giving something to somebody for less than what it’s worth, » said Toronto-based commercial litigation lawyer Tamara Ramsey.
« They’ve certainly concluded that there’s some evidentiary basis for an argument that the payment of the dividend … rendered the company insolvent, which in essence, is [an argument] the company couldn’t afford to pay the dividend and the shareholders or certain insiders were taking care of themselves. »
Commercial litigation lawyer Tamara Ramsey says a ‘transfer at undervalue’ generally means a company is giving something to somebody for less than what it’s worth. (CBC)
Sears Canada didn’t file for bankruptcy protection until June 2017. It laid off 17,000 employees with no severance pay before closing its final stores in January.
But in court documents, the monitor argues that in 2013, the retailer was already on « a path to inevitable insolvency. »
The evidence listed includes the company’s « steadily declining financial performance » and its policy of « making significant distributions to shareholders without investing in the growth » of the business.
Sears Canada retiree Ron Husk, 73, had to return to work to make up for the shortfall in his pension payments. (Rhonda Thistle)
Sears Canada pensioner Ron Husk was happy to learn there may be court action involving the $509-million dividend payout.
« That could be a great thing for the pensioners, fantastic thing, » said Husk, who had to return to work as a greeter at Home Depot in Mount Pearl, N.L., to make up for the shortfall in his pension payments.
He says he’s holding out hope some of the dividend money will make its way back to Sears retirees.
« I gave 35 years of my life to Sears. I don’t want to be out working. I’m 73 years old. »
Get a taste of adventure with Starburst XXXtreme based on the legendary NetEnt Game. The nostalgic themes are sure to capture fans of the classic version as they get treated to higher intensity, better visuals, and features. The most significant element of the game is its volatility. Patience will not be an essential virtue considering the insane gameplay, and there is a lot of win potential involved. It retains the original makeup of the previous game while adding a healthy dose of adrenaline.
Starburst Visuals and Symbols
The game is definitely more conspicuous than before. The setting happens over a 5-reel, 3-row game grid with nine fixed win lines, which function if a succession from the left to the right reel is present. Only those players that that attain the highest win per bet line are paid. From a visual standpoint, the Starburst XXXtreme slots illustrates lightning effects behind the reels, which is not surprising as it is inherited from the original version. Available themes include Classic, Jewels, and Space. The game is also available in both desktop and mobile versions, which is advantageous for players considering the global pandemic. According to Techguide, American gamers are increasingly having more engaging gaming experiences to socialize to fill the gap of in-person interaction. Starburst XXXtreme allows them to fill the social void at a time when there is so much time to be had indoors.
Starburst XXXTreme Features
Players get to alternate on three features which are Starburst Wilds, XXXtreme Spins, and Random Wilds. The first appears on reels 2,3, or 4. When these land, they expand to cover all positions while also calculating the wins. They are also locked for a respin. If a new one hits, it also becomes locked while awarding another respin. Starburst XXXtreme offers a choice between two scenarios for a higher stake. In one scenario with a ten times stake, the Starburst Wild is set on random on reels 2,3, or 4, and a multiplier starts the respin. The second scenario, which has a 95 times stake, starts with two guaranteed starburst wilds on reels 2,3, or 4. it also plays out using respin game sequence and features. The game also increases the potential with the Random Wilds feature to add Starburst Wilds to a vacant reel at the end of a spin. Every Starburst Wild gives a random multiplier with potential wins of x2, x3, x5, x10, x25, x50, x100, or even x150.
The new feature is sure to be a big hit with the gaming market as online gambling has shown significant growth during the lockdown. AdAge indicates the current casino customer base is an estimated one in five Americans, so Starburst XXXtreme’s additional features will achieve considerable popularity.
What We Think About The Game
The gambling market has continued to diversify post-pandemic, so it is one of the most opportune times to release an online casino-based game. Thankfully Starburst XXXtreme features eye-catching visuals, including the jewels and space themes. These attract audience participation and make the gameplay inviting. The game also has a nostalgic edge. The previous NetEnt iteration featured similar visuals and gameplay, so the audience has some familiarity with it. The producers have revamped this version by tweaking the features to improve the volatility and engagement.
That is characterized by the potential win cap of 200,000 times the bet. Starburst XXXtreme does not just give betting alternatives for players that want to go big. The increase of multipliers also provides a great experience. If the respins in the previous version were great, knowing that multipliers can go hundreds of times overtakes the game to a new level.
Players should get excited about this offering. All of the features can be triggered within a single spin. Whether one plays the standard game or takes the XXXtreme spin route, it is possible to activate all of the features. Of course, the potential 200,000 times potential is a huge carrot. However, the bet size is probably going to be restricted and vary depending on the casino. It is also worth pointing out that a malfunction during the gameplay will void all of the payouts and progress. Overall, the game itself has been designed to provide a capped win of 200,000 times the original bet.
In the city’s entertainment district, a musical act was conducting a sound check on stage Friday evening — the second day of the French-language version of the renowned Just For Laughs comedy festival. Tickets for many of the festival’s free outdoor shows — limited by COVID-19 regulations — were sold out.
Two blocks away, more than 100 people were watching an acoustic performance by the Isaac Neto Trio — part of the last weekend of the Festival International Nuits d’Afrique, a celebration of music from the African continent and the African diaspora.
With COVID-19 restrictions continuing to limit capacity, festival organizers say they’re glad to be back but looking forward to next year when they hope border restrictions and capacity limits won’t affect their plans.
Charles Décarie, Just For Laughs’ CEO and president, said this is a “transition year.”
“Even though we have major constraints from the public health group in Montreal, we’ve managed to design a festival that can navigate through those constraints,” Décarie said.
The French-language Juste pour rire festival began on July 15 and is followed by the English-language festival until July 31.
When planning began in February and March, Décarie said, organizers came up with a variety of scenarios for different crowd sizes, ranging from no spectators to 50 per cent of usual capacity.
“You’ve got to build scenarios,” he said. “You do have to plan a little bit more than usual because you have to have alternatives.”
MONTREAL — MELS Studios will build a new film studio in Montreal, filling some of the gap in supply to meet the demand of Hollywood productions.
MELS president Martin Carrier said on Friday that MELS 4 studio construction will begin « as soon as possible », either in the fall or winter of next year. The studio could host productions as early as spring 2023.
The total investment for the project is $76 million, with the Quebec government contributing a $25 million loan. The project will create 110 jobs, according to the company.
The TVA Group subsidiary’s project will enable it to stand out « even more » internationally, according to Quebecor president and CEO Pierre Karl Péladeau. In the past, MELS Studios has hosted several major productions, including chapters of the X-Men franchise. The next Transformers movie is shooting this summer in Montreal.
Péladeau insisted that local cultural productions would also benefit from the new facility, adding that the studio ensures foreign revenues and to showcase talent and maintain an industry of Quebec producers.
STUDIO SHORTAGE
The film industry is cramped in Montreal.
According to a report published last May by the Bureau du cinéma et de la télévision du Québec (BCTQ), there is a shortage of nearly 400,000 square feet of studio space.
With the addition of MELS 4, which will be 160,000 square feet, the company is filling part of the gap.
Carrier admitted that he has had to turn down contracts because of the lack of space, representing missed opportunities of « tens of millions of dollars, not only for MELS, but also for the Quebec economy. »
« Montreal’s expertise is in high demand, » said Montreal Mayor Valérie Plante, who was present at the announcement.
She said she received great testimonials from « Netflix, Disney, HBO and company » during an economic mission to Los Angeles in 2019.
« What stands out is that they love Montreal because of its expertise, knowledge and beauty. We need more space, like MELS 4, » she said.
There is still not enough capacity in Quebec, acknowledged Minister of Finance, the Economy and Innovation Eric Girard.
« It is certain that the government is concerned about fairness and balance, so if other requests come in, we will study them with the same seriousness as we have studied this one, » he said.
Grandé Studios is the second-largest player in the industry. Last May, the company said it had expansion plans that should begin in 2022. Investissement Québec and Bell are minority shareholders in the company.
For its part, MELS will have 400,000 square feet of production space once MELS 4 is completed. The company employs 450 people in Quebec and offers a range of services including studio and equipment rentals, image and sound postproduction, visual effects and a virtual production platform.