The owner of the Medicine Hat Lodge has reached an agreement with ATB Financial that allows it to refinance a substantial debt with another bank rather than enter receivership.--News File Photo
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A last minute deal between the Medicine Hat Lodge owners and Alberta Treasury Branch will allow Mayfield Investments to refinance loans with a different bank before further court action is taken.
The matter was heard at a King’s Bench receivership hearing in Edmonton on Friday afternoon.
It heard that deal from lunch-hour negotiations would see the Lodge’s parent company enter voluntary receivership as a condition of engaging other financing.
Mayfield’s attorney, Chuck Russell, of McLennan Ross, also said his client will consent to a tentative receivership order and withdraw a cross-application to enter Court Creditors protection.
It is focused on strengthening its business, he said, and both sides worked hard on the agreement in recent months.
“We will be able to forward the refinancing that is in order to salvage the business,” said Russell. “A large number of employees and sureties (creditors) have an interest in seeing the business survive.”
Lawyers for ATB said their client is owed $38 million on a secured basis under several credit facilities stemming from a 2021 agreement.
It filed court application to appoint a receiver in July in order to recover those funds.
“The parties worked very hard to come to a further agreement,” said Sean Collins, of McCarthy Tetrault LLP, adding ATB will stay, though not withdraw, its application after Mayfield presented a tentative credit agreement it holds with another large bank.
“ATB has determined that it will allow Mayfield to refinance the obligations under agreement it has with (another) bank.”
Justice Michael Lema accepted the application.
“It’s clear to me that the current circumstance laid out warrants the granting of a receivership order, but also the stay mechanism that puts everything on hold,” he said.
“I’m happy to grant it … There’s a lot that happens behind the curtains, so I congratulate those people whose efforts have come to terms and I wish you good luck.”
The Medicine Hat Lodge is also the current landlord of the Copper Coulee Casino and a minority shareholder in the enterprise that was previously known as Casino by Vanshaw.
“It’s a very fluid situation,” said Albert Stark, majority partner in the casino, along with Cam Christiansen, of Canalta Hotels. “We’ll find out more by the end of October.”
Six exhibits, including financial information, were scheduled to be part of restricted access ruling. That would have sealed them to the media, but instead ATB withdrew them as exhibits, essentially making them unavailable.
