Squamish’s world-renowned polar touring company has been given an extension for its financial protection by the courts.
On June 29, Justice Andrew Mayer lengthened the stay of proceedings that had been previously granted to One Ocean Expeditions.
The stay prevents people from litigating against the company for things such as payments owed.
This is the second time the company has won an extension for this financial protection.
One Ocean filed a notice of intention to make a proposal under the Bankruptcy and Insolvency Act in late April. As a result, the courts granted the company a stay.
The stay was first granted in late April and set to expire in May. It was then extended until the end of June.
As of June 29, it has been extended again — this time until Aug. 13.
“I’m satisfied that it makes sense, and it’s in the interests of the debtor and of the creditors that efforts be made to try to realize as much as possible, including anything that may be obtained through the ...process,” said Mayer.
The judge acknowledged that One Ocean’s situation will likely not be turned around by the new deadline, but said that the stay will at least give some certainty in the meantime.
This will give One Ocean more time to file its proposal under the Bankruptcy Act.
According to the court application, one of the company’s vessels ran aground in the Arctic in August 2018, forcing cancellations of nine trips.
Later, around April 2019, the owners of the ships terminated agreements with One Ocean and withdrew two of One Ocean’s three vessels from service.
The court application said that One Ocean chartered two ships from the PP Shirshov Institute of Oceanology and Terragelida Ship Management Ltd.
Disputes with the Shirshov Institute led to cancellations of trips and sales plummeted, the application said.
The application said that One Ocean is in arbitration proceedings against Terragelida and the Shirshov Institute.
One Ocean is claiming USD $6.5 million against Terragelida associated with the incident where a ship was run aground in the Arctic.
The company is claiming USD $12.5 million against the Shirshov Institute as a result of its withdrawing two ships from One Ocean’s service.
One Ocean no longer has any vessels to run its operations, the application said.
One Ocean has $30 million in unsecured liabilities, consisting mainly of refunds owed to passengers and money owed to suppliers and other creditors.
According to its application, the company intends to create a proposal that would do three things.
It would give customers a chance to waive their claim in exchange for a discounted future trip with One Ocean.
It would also create a pool of funds that would be distributed to unsecured creditors.
Finally, it would generate a litigation trust that would allow One Ocean to pursue arbitration.
The proceeds of that action would be given to Export Development Canada, One Ocean’s major secured creditor, which is claiming $2 million.
The remainder of the money would go to One Ocean’s unsecured creditors.
“A proposal along these lines would be significantly better for unsecured creditors, who would likely receive nothing in bankruptcy as a result of [Export Development Canada’s] secured claim,” reads the application.