Hi-Rise Capital Ltd.

IMPORTANT UPDATE REGARDING FINAL DISTRIBUTION

This update is in respect of the Distribution Plan and the Final Distribution made to Non-Registered Investors pursuant to the Final Distribution Order (further described below on this website under the heading “Distribution Plan and Final Distribution”.

During the week of May 16, 2022, Representative Counsel and its Distribution Agent delivered all Final Distribution cheques to the Remaining Investors in this proceeding, which are Non-Registered Investors that are eligible to receive a Final Distribution. The Final Distribution cheque has been delivered by regular mail to the addresses recorded in our files. Please keep an eye out for this letter.

If you are a Non-Registered Investor eligible to receive a Final Distribution, it is extremely important that you deposit/cash your Final Distribution cheque immediately upon receipt. Failure to do so may lead to the cheque becoming stale-dated, in which case you will be barred from seeking a reissued cheque and you will be exempt from receiving a Final Distribution (full details are set out below on this website).

If you are a Registered Investor or a Settled Investor described in Representative Counsel’s Ninth Report dated March 29, 2022, this section does not apply to you and you will not be receiving a Final Distribution under the Distribution Plan (as you have already received a full distribution and are not eligible to participate in the Final Distribution). There is nothing further for you to do.

Appointment of Representative Counsel

Pursuant to the Order of the Honourable Mr. Justice Hainey of the Ontario Superior Court of Justice (Commercial List) (the “Court”) dated March 21, 2019 (the “Order”) Miller Thomson LLP (“Representative Counsel”) was appointed to represent all individuals and/or entities (“Investors”) that hold an interest in a syndicated mortgage (“SMI”), administered by Hi-Rise Capital Ltd. (“Hi-Rise”), in respect of the property municipally known as 263 Adelaide Street West, Toronto, Ontario (the “Property”) and the proposed development known as the “Adelaide Street Lofts” (the “Project”). A copy of the Order can be found in the ‘Documents’ section of this webpage.

Pursuant to the Order, Representative Counsel represents the interests of all Investors, except Investors who do not wish to be represented by Representative Counsel and have completed and delivered an Opt-Out Notice.

Communications with Representative Counsel

Representative Counsel has established this webpage to facilitate communications with Investors. This webpage will include information and documents relevant to Investors. Please regularly consult the ‘Communications’ section of this webpage for updates from Representative Counsel on this proceeding. Representative Counsel will also email updates and communications to all Investors on the email distribution list. If you are not receiving these emails, please email Representative Counsel at the email address below and we will add you to the email distribution list.

Questions regarding this proceeding should be directed to Representative Counsel at HiRiseCapital@millerthomson.com. Representative Counsel reviews all emails received through this email address on a daily basis, and will respond to new inquiries through further communications to Investors (which will be emailed to Investors and posted on the Website). In order to manage the volume of inquiries and to effectively respond to all Investors, we ask that all Investors submit their inquiries to this email address only.

Official Committee

Pursuant to the Order, Representative Counsel was directed to appoint an Official Committee of Investors (the “Official Committee”) in accordance with the Official Committee Establishment Process.  Representative Counsel fully carried out the Official Committee Establishment Process and selected 5 Investors to act as members of the Official Committee and 2 Investors to act as alternate members to the Official Committee.

Pursuant to the Order of the Court dated April 15, 2019 the (“Approval Order”), the Official Committee was approved and constituted. A copy of Representative Counsel’s motion materials and the Approval Order can be found in the ‘Documents’ section of this webpage.

Subsequent to the Approval Order, one of the Official Committee members resigned. Accordingly, there are currently 4 Investors that act as members of the Official Committee. Representative Counsel regularly consults with and takes instructions from the Official Committee in respect of matters related to this proceeding. Members of the Official Committee are required to follow the Official Committee Protocol.

Transaction, Settlement, and Court Approval

In November 2019, Lanterra Developments Ltd. offered to purchase 100% of the Property for the purchase price of $69,000,000 (the “Lanterra Transaction”). The parties entered into Minutes of Settlement to memorialize the terms of the Lanterra Transaction (the “Settlement”). Full details of the Settlement are set out in the Fourth Report of Representative Counsel dated January 9, 2020 and the Motion Record of Representative Counsel dated April 6, 2020, copies of which are posted under the ‘Documents’ section of this website.

The Settlement was amended by Amended Minutes of Settlement. Under the terms of the Settlement, as amended, the Lanterra Transaction is scheduled to close on November 16, 2020. After this closing date, Representative Counsel will attend to the distribution to Investors in accordance with the process set out in the Minutes of Settlement.

On April 27, 2020, the Court approved the Settlement, as amended, and the Lanterra Transaction, among other things. A copy of the Order of Justice Hainey dated April 27, 2020 is posted under the ‘Documents’ section of this website.

Pursuant to the Order of Justice Hainey dated November 23, 2020, a copy of which is posted under the ‘Documents’ section of this website, the Court approved the Distribution Plan and related Distribution Plan Procedures (as defined therein), under which Investors will receive their distribution from the Settlement.

Distribution Plan and Final Distribution to Investors

Pursuant to the Order of Justice McEwen dated April 28, 2022 (the “Final Distribution Order”), a copy of which is posted under the ‘Documents’ section of this website, the Court approved a Final Distribution to the Remaining Investors in accordance with the Final Claim Index, among other things.

Pursuant to the Final Distribution Order, any Investor in this proceeding that has not filed a Notice of Objection under the Distribution Plan is deemed to have: (a) accepted the Investor Claim Amount, classification and other information set out in his or her Investor Payment Notice (distributed under the Distribution Plan); and (b) waived any further objection to the Investor Claim Amount, classification and other information set out in his or her Investor Payment Notice. Accordingly, and for greater certainty, it is not open to any Investor in this proceeding to make an objection under the Distribution Plan, and any and all further objections are forever barred and permanently extinguished.

Pursuant to the Final Distribution Order, upon the 6-month expiry of the delivery of the Final Distribution, any Remaining Investors that fail to cash their Final Distribution cheque shall be treated in accordance with the court-approved Missing Investor Final Distribution Funds Plan. This means that if you received a Final Distribution cheque and you fail to cash/deposit your cheque by early November 2022 and the cheque becomes stale-dated:

• You are exempt from receiving your Final Distribution, any amounts owing to you under the Final Distribution Order are forever extinguished, and any claims you may have to a Final Distribution are forever barred;
• You are barred from seeking a reissued Final Distribution cheque from the Distribution Agent, and the Distribution Agent is not required to issue you a new cheque;
• The Final Distribution amount that would have been payable to you will be delivered to the members of the Official Committee as a court-approved Subsequent Honorarium (provide the aggregate amount does not exceed $40,000).

Accordingly, upon receipt of your Final Distribution cheque, please cash/deposit same immediately. Upon cashing/depositing your Final Distribution cheque, there is nothing further for you to do.