Monthly Archives: March 2015

2015
03/26

Category:
Debt Settlement

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Extenway Announces Proposed Debt Settlement and Second Tranche of a …

MONTREAL, QUEBEC–(Marketwired – March 2, 2015) – Extenway Solutions Inc. (Extenway or the Company) (TSX VENTURE:EY) announces that it is arranging, subject to regulatory approval, the private placement and the debt settlement operations described below in order to immediately improve the financial position of the Company with a view of setting the Company on firm financial ground to execute its business plan. The proposed private placement and debt settlement operations are as follows:

(a) a private placement of 30,125,000 common shares of the Company, at an issue price of $0.08, with a group of accredited investors, including the Caisse de dpt et placement du Qubec (Caisse) and Desjardins-Innovatech, sec. (DI), existing shareholders of Extenway, for minimum gross proceeds to the Company of $2.41 million (the Private Placement). When combined with the $500,000 already raised pursuant to the closing of the first tranche on December 23, 2014, the aggregate amount of this round of financing will reach $2,910,000; and

(b) the settlement of up to $10,425,928.61 (as of the date of this press release) in outstanding indebtedness under outstanding debentures and working capital advances by issuing up to 130,324,109 common shares of the Company (as this number is determined as of the date of this press release) at an issue price of $0.08 (collectively, the Debt Settlement). The amount of the Debt Settlement includes advances in excess of $900,000 provided by (a) Mr. John McAllister (directly or indirectly),the President and Chief Executive Officer of Extenway (McAllister), and (b) Mr. David Brown, Chief Financial Officer of Extenway (Brown), since May 1st, 2014. As a result, upon the closing of the Private Placement and the Debt Settlement, investments in excess of $3,825,000 will have been made in the Company since May 1st, 2014. The indebtedness subject to the Debt Settlement consists in both the principal amount and the accrued and unpaid interest of:

  1. those issued and outstanding unsecured convertible debentures issued by the Company held by John McAllister Holdings Corporation, a company controlled by McAllister (McAllisterCo), Caisse, DI and 12 other investors for an aggregate principal amount of $6,170,000. As of today, the total indebtedness under said debentures is $7,687,078.61 (the Convertible Indebtedness). The principal amount of the debentures is currently convertible into common shares of Extenway, at a price of $0.13 per share, however, with the current market price of the Companys common shares on the TSX Venture Exchange being approximately $0.04, there is no incentive to any holders of debentures to convert. The Company has entered into discussions with the holders of debentures with respect to the conversion of all or a portion of their debentures into common shares, at a price of $0.08, the same issue price as the one provided for in the Private Placement. McAllisterCo, Caisse and DI have agreed to convert their debentures into common shares as part of the proposed Debt Settlement; and
  2. those unsecured advances from McAllister, Brown and another officer of the Company in the amount of $2,013,850, $710,000 and $15,000, respectively, which were made to assist the Company with its working capital needs (the Working Capital Advances).

The purpose of the Private Placement and Debt Settlement is to immediately improve the financial position of the Company given its actual financial situation. The Company has been diligently pursuing additional sources of debt and equity financing and has determined that the proposed Private Placement and Debt Settlement was the best alternative for the Company.

Mr. John McAllister, President and Chief Executive Officer of Extenway, stated: As previously announced the Company has secured a significant number of new hospital contracts and believe that additional opportunities are pending. This has encouraged our major shareholders to address balance sheet issues in advance of these installations and is a major vote of confidence for us.

The Debt Settlement and the Private Placement will allow the Company to greatly improve its balance sheet while its non-banking debts for borrowed money will be reduced by at least $8,119,805.03 and its working capital will be increased by $2,410,000. added Mr. McAllister.

Private Placement

The Company has been in discussion with a group of accredited investors, including Caisse and DI, which have indicated their interest in participating in the Private Placement, subject to: (i) the conversion of at least 70% of the Convertible Indebtedness; (ii) the settlement of the Working Capital Advances, and (iii) other customary closing conditions. It is expected that Caisse and DI will subscribe for 18,750,000 common shares ($1,500,000) and 6,250,000 common shares ($500,000), respectively.

Related Party Transactions

The Company understands that McAllister, Brown and DI own, directly or indirectly or exercise control or direction over, 31,988,535 common shares, 29,975,210 common shares and 31,156,516 common shares, respectively, representing 22.38%, 20.98% and 21.80%, respectively, of the currently issued and outstanding common shares of the Company. In addition, McAllister and Brown are officers of the Company.

As a result, each of the proposed Private Placement and the Debt Settlement is considered a related party transaction pursuant to Policy 5.9 of the TSX Venture Exchange and Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (MI 61-101) and triggers the requirement for a valuation and minority approval unless exemptions therefrom are available. As Exentway is not listed on or quoted on any prescribed senior exchange listed in MI 61-101, the proposed Private Placement and Debt Settlement are each exempt from the formal valuation requirement contained in MI 61-101 pursuant to section 5.5(b) of MI 61-101. In addition, Extenway is relying on the financial hardship exemption from the minority approval requirement contained in MI 61-101 pursuant to section 5.7(e) of MI 61-101. In reliance thereon, the Board of Directors of the Company (other than Mr. McAllister, who abstained from voting on the proposed transaction), including all of its independent members, has unanimously concluded that the Company is in serious financial difficulty and the proposed Private Placement and Debt Settlement, the terms of which are reasonable in the circumstances, will improve the financial position of the Company. Finally, in accordance with MI 61-101, the Company will not file a material change report in respect of the proposed related party transactions before at least 21 days of the expected date of the closing considering the fact that it is in the best interests of the Company to collect the proceeds from the Private Placement as soon as possible.

Assuming the completion of the Private Placement and the Debt Settlement (and assuming the settlement of the entire amount (100%) of the Convertible Indebtedness) on March 11, 2015, it is expected that McAllister, Brown and DI will own, directly or indirectly or exercise control or direction over, 65,188,793 common shares, 38,850,210 common shares and 51,452,463 common shares, respectively, representing 21.47%, 12.79% and 16.95%, respectively, of the then issued and outstanding common shares of the Company.

The Company anticipates closing the Private Placement and the Debt Settlement on or about March 11, 2015.

Resignation of Jacky Chatelais

The Company announces the resignation of the President of its wholly-owned subsidiary, Extenway MD Inc., Jacky Chatelais. Extenways President and Chief Executive Officer, John McAllister, will assume the position of President of Extenway MD Inc. on an interim basis until such time a permanent successor is selected. Mr. Chatelais will continue to assist in the operations of Extenway MD Inc. as a consultant.

About Extenway Solutions

Extenway Solutions is a supplier of client-focused solutions for the healthcare industry. Services offered by Extenway include interactive television, beside terminals for patients, internet, entertainment, content integration, advertising, education and medical integrated solutions. Extenway allows organizations to optimize management and coordination of human interactions as well as communications, information and coordination. For further information, please visit extenway.com or follow us on Twitter @Extenway.

Disclaimer

Certain statements that appear in this news release constitute forward-looking statements. These forward-looking statements relate to future financial conditions, results of operations or business of Extenway Solutions Inc. These statements may be current expectations and estimates about the markets in which Extenway Solutions Inc. operates and managements beliefs and assumptions regarding these markets. These statements involve significant risks and uncertainties which are difficult to predict and assumptions which may prove to be inaccurate. The results or events predicted in forward-looking statements may differ materially from actual results or events. Extenway Solutions Inc. disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In particular, forward-looking statements do not reflect the potential impact of any merger, acquisitions or other business combinations or divestitures that may be announced or completed after such statements are made.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

2015
03/26

Category:
Credit Cards

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How gas credit cards affect your credit score

Gas credit cards have declined in popularity over the past decade as consumers switched to using bank-issued cards at the pump. But for the credit-challenged, gas credit cards have long been touted as a way to quickly build credit, since even those with a less-than-desirable credit history can qualify and use them to build credit.

But are gas credit cards the best option for someone in search of a better credit score? Here are several factors to consider before you fill out that application.

PROS

GAS CREDIT CARDS ARE ACCESSIBLE

One of the biggest benefits to fuel cards is that they’re accessible to a wide consumer market. While standard credit cards may require a good or excellent credit score to open, a gas card provider will often issue a credit card to someone with less-than-stellar credit or no credit history at all.

YOU CAN EARN CREDIT CARD REWARDS AND REBATES ON GAS

Depending on the gas credit card you choose, you may be eligible for cash-back rebates on every dollar you spend at the pump. If you find yourself always fueling at the same gas station on your way to work or you have a fuel brand you prefer, this can be a big bonus. Some of these cards require a minimum monthly purchase on gas each month to qualify for the rebate, however, so pick a gas card for a company that has a large selection of gas stations in the areas you frequently travel for best results.

PRE-QUALIFICATION PROTECTS YOUR CREDIT SCORE

When searching for a credit card, the process of applying and being rejected can take a toll on your already-low credit score. Fortunately, some credit card companies allow applicants to answer a few questions to determine if they’ll qualify before applying and incurring a hard inquiry on their credit, which can cause it to dip.

GAS CARDS OFFER CONVENIENCE

If you have a debit card, you probably already take advantage of the ability to pay at the pump. While gas cards extend this same convenience, many also offer small cards that fit on a cardholder’s key rings, allowing you to always have your payment method handy.

CONS

HIGHER INTEREST RATES

When choosing a gas card, be sure you compare interest rates from one franchise to another. Many gas cards come with interest rates in the 20 percent to 25 percent APR range, reports CreditCards.com, and with bad credit limiting your options, you may be forced to pay a higher rate than you can afford. Of course, your best option to build your credit and avoid paying interest is to pay your balance off each month rather than allowing it to accrue.

ANNUAL FEES

Because some gas credit cards come with annual fees, it’s important to scrutinize those fees carefully before applying. By being fully informed of the credit card’s terms at the outset, you can avoid unpleasant surprises once you have the card in your wallet.

LIMITED USE

Some gas credit cards are co-branded by a major issuer like Visa and MasterCard and can be used anywhere those cards are accepted. Others are dedicated gas credit cards that are issued by a fuel company and are only usable at the gas stations bearing that brand’s name. On top of finding a card with favorable terms, you will have also have the card is issued by a gas station you’ll actually use.

ACCUMULATED COST

When your fuel cost is built into the rest of your monthly expenditures, you likely don’t even notice that expense. But with a gas credit card, you’ll get a bill at the end of the month for every gallon you’ve purchased. When you’re suddenly tasked with coming up with the funds to pay for your fuel purchases all month, you may find it’s more challenging to pay off the balance in full.

Fuel cards are an excellent option for consumers facing difficulty obtaining a general credit card. With careful selection, a customer can land a great gas card with low interest rates and rewards.

2015
03/26

Category:
Debt Settlement

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Great Lakes Graphite Announces Private Placement And Debt Settlement …

Toronto, Ontario–(Newsfile Corp. – March 4, 2015) – Great Lakes Graphite Inc. (TSXV: GLK) (OTC: GLKIF) (FWB: 8GL) (Great Lakes or the Company) wishes to announce a new non-brokered private-placement offering of up to a total of ten (12) million units of Company equity.

The private placement will comprise two separate unit offerings (collectively the Offering). The first will include an offering of 6,000,000 units (each a Unit) at a price of $CDN 0.05 per Unit, for gross proceeds of up to $CDN 300,000. Each Unit will consist of one common share of the Company and one common share-purchase warrant (the Warrants); each Warrant will entitle the holder to purchase one additional common share of the Company at a price of $CDN 0.10 for a period of twenty-four (24) months after the closing of the Offering.

The second part will include an offering of 6,000,000 flow-through units (each a Flow-Through Unit) at a price of $CDN 0.05 per Flow-Through Unit, for gross proceeds of up to $CDN 300,000. Each Flow-Through Unit will consist of one flow-through eligible common share of Great Lakes and one common share-purchase warrant (the FT Warrants); each FT Warrant will entitle the holder to purchase one additional Great Lakes common share (non-flow-through eligible) at a price of $CDN 0.10 for a period of twenty-four (24) months after the closing of the Offering.

A finders fee equal to a cash commission of 8% of the aggregate gross proceeds from the Units and/or Flow-Through Units sold, plus finders warrants equal to 8% of the aggregate number of Units and/or Flow-Through Units sold, will compensate finders appointed by the Company to source subscriptions. All securities issued by the Offering will be subject to a hold period of four months plus one day. The Offering is subject to regulatory approval.

The Offering is scheduled to close on March 20, 2015. Net Proceeds from the Offering will be used to conduct a Feasibility Study of the Lochaber Graphite Project, to initiate work on the Matheson Micronization Facility and for corporate development purposes.

The Company also announces that it has settled a total of $130,000 of debt (the Debt) with an arms-length party to the Company (the Shares for Debt Settlement).

The Debt payable to the arms-length party totaled $130,000.00 and the Company has settled the same by issuing an aggregate of 2,600,000 common shares at a deemed price of $0.05 per share.

Securities issued as part of this transaction will be subject to a hold period of four months plus one day. The Shares for Debt Settlement is subject to regulatory approval.

About Great Lakes Graphite: Great Lakes Graphite Inc. is an Industrial Minerals company bringing graphite products to market by establishing a vertically integrated supply chain and through the acquisition and development of high quality graphite deposits.

As there are currently no graphite mines producing in North America, Great Lakes Graphite has the ability to become one of the first producers to supply a growing regional customer base that requires high quality natural graphite, where pricing and demand continue to rise.

The Company, through strategic acquisitions and capable management will become a leader in the industrial minerals marketplace. The Companys 100%-owned flagship Lochaber Graphite property is located just 30km east of Ottawa, in southwestern Qu#xE9;bec. The Company has also entered into option and joint venture agreements with Eloro Resources Inc. (TSXV: ELO) on the Summit-Gaber Cobalt property located in the La Grande Greenstone Belt in the Baie James region of Qu#xE9;bec. Further information regarding Great Lakes can be found on the Companys website at: www.GreatLakesGraphite.com.

Great Lakes Graphite trades with symbol GLK on the TSX Venture Exchange and currently has 78,714,820 shares outstanding (107,602,456 fully diluted).

For more information, please contact:

Paul Gorman
Chief Executive Officer
Email: [email#160;protected]
Tel: 416-768-6101

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

2015
03/25

Category:
Credit Cards

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Best Credit Card Offers for Frugal Spenders

by Erin El Issa on March 13, 2015 | posted in 0% Credit Cards, Cash Back Credit Cards, Credit Cards and Debt, Rewards Credit Cards, Travel Credit Card Tips

2015
03/24

Category:
Debt Settlement

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PIA apathy costs Grant Thornton

POOR take-up of insolvency arrangements introduced by the government in 2013 have led to accumulated losses of almost EUR400,000 for Grant Thornton Debt Solutions, Ireland’s largest firm of personal insolvency practitioners.

The firm, a joint venture between the Irish and UK practices of accountancy firm Grant Thornton, lost EUR290,000 in the year to the end of January 2014, following losses of EUR100,000 the previous year.

It was set up to capitalise on Grant Thornton’s experience in the UK, where it has 30% of the personal insolvency market.

Michael Bolger, head of operations, said the firm processes only 15-20 debt settlement and personal insolvency arrangements (PIAs) a week. “We could do 50 individual voluntary arrangements in the UK in the time it takes to do a single PIA in Ireland. The system needs to change,” he said.

Only 199 PIAs were approved last year, according to the Insolvency Service of Ireland.

2015
03/23

Category:
Credit Cards

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Credit cards link man to victims of triple-homicide, police say; bail at $2 …

BOISE, Idaho — An Idaho sheriff has appealed for help from the public to determine what might connect a slain former Arizona power company executive, his wife and adult son to a 22-year-old man who prosecutors say was arrested with credit cards linked to the murder victims.

Bail was set at $2 million Thursday for Adam M. Dees of Nampa, who faces three counts of grand theft, three counts of forgery and a misdemeanor count of carrying a concealed weapon without a permit. The 9 mm handgun was found tucked into Dees waistband, prosecutors said, without disclosing whether it was linked to the killings.

Dees is not charged with murder.

The victims found Tuesday in a home in the foothills outside Boise have been identified as 80-year-old Theodore M. Welp, 77-year-old Delores Elaine Welp and their son, 52-year-old Thomas P. Welp. No motive or causes of death were released.

Ada County Sheriff Gary Raney has said the killings were the most violent he had seen in three decades in law enforcement. In addition to asking for help in determining a possible connection between Dees and the Welps, authorities were looking for information on a wedding ring they believe Dees tried to sell. They didnt know if it was connected to the killings.

The Welps formerly lived in Arizona, where Theodore Welp was the chief of Tucson Electric Power Co. in the 1980s. He was blamed by some for the financial downfall of the company.

The Arizona attorney generals office conducted an investigation into the financial dealings, but the probe did not result in criminal charges.

The killings took place in what records say is a three-bedroom, three-bathroom home on about 20 acres with a total value of about $800,000, owned by Theodore and Elaine Welp. Authorities say the property has horses and other buildings.

No words can adequately express the grief and despair we are feeling, the Welp family said in a statement issued through the sheriffs office. These were kind, caring and generous people who meant so much to us and have been senselessly taken from us.

Theodore and Elaine Welp were also involved with charitable organizations, including one that funds research on vision impairment and blindness.

Police arrested Dees on Wednesday at an electronics store. Prosecutors listed a handful of other sites where they said he used the credit cards, forged the names of the homicide victims, and was later identified by workers.

Dees father, Steve Dees, told the Idaho Statesman that his son told his family he found the credit cards.

The young man wore restraints but appeared relaxed during his appearance in Ada County Court via a video feed from jail.

In a clear voice, Dees said no when asked by Judge Theresa Gardunia if he would be able pay the bail.

Defense attorney Isaiah Govia has sought bail of $25,000, noting his client had no previous felony convictions. He also said Dees was put on suicide watch after being arrested because he is bipolar and schizophrenic and didnt have access to his medication.

Gardunia ordered Dees to return to court on March 26.

— The Associated Press

2015
03/22

Category:
Credit Cards

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Fontana man charged with manufacturing false credit cards and scamming 30 …

Chino Hills deputies have arrested a 25-year-old Fontana man for illegally manufacturing false credit cards that contained the credit card information of more than 30 victims throughout Southern California, according to the San Bernardino County Sheriffs Department.

Jamell Roy Howard was arrested March 13 on charges of manufacturing credit cards and possessing access card information.

2015
03/22

Category:
Credit Cards

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NYC man arrested at airport after credit cards found in luggage

David M. Ricketts, 25, faces one count each of trafficking in counterfeit credit cards and falsely making credit cards, records show. He was being held Monday in the Broward Main Jail on $10,000 bond.

2015
03/21

Category:
Debt Settlement

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Advanced Explorations Inc. Announces Completion of Shares for Debt Transaction

TORONTO, ONTARIO–(Marketwired – March 10, 2015) – Advanced Explorations Inc. (the Company or AEI) (TSX VENTURE:AXI)(FRANKFURT:AE6) today announced that it has completed the shares for debt transaction announced on February 24, 2015 after receiving approval from the TSX Venture Exchange (the Exchange).

Pursuant to the shares for debt transaction, the Company has issued 8,324,630 common shares (the Shares) at a deemed price of $0.05 per Share in full settlement of debt in the amount of $416,231.52. The foregoing shares are subject to a statutory four-month hold period in accordance with applicable securities laws.

Additionally, the Company wishes to provide an update on the additional shares for debt settlement announced by the Company on January 16, 2015. Accordingly, the Company has submitted its request to issue shares for debt to the Exchange and is currently in the process of receiving Exchange approval for the transaction. Upon receipt of conditional approval, the Company intends to issue common shares of the Company at a deemed price of $0.05 per common share in full and final settlement of approximately $350,000 by the issuance of a maximum of 7,000,000 common shares to said creditors.

ON BEHALF OF THE BOARD

Eric Guo, MBA, CFA, Chief Executive Officer

All those seeking additional information are directed to contact Brendan Purdy; 416-203-0057 (ext 320).

ABOUT Advanced Explorations Inc.

Advanced Explorations Inc., based in Toronto, Ontario, is a resource development company focused on developing its Roche Bay and Tuktu Iron Ore Projects in one of the worlds largest developing iron ore districts, the Melville Peninsula in Nunavut. The Ocean-based Roche Bay Project boasts an NI 43-101 compliant resource estimate of over 500 million tonnes outlined within a small portion of the potential 140 km of banded iron formation. A positive feasibility study for the projects C Zone revealed a net present value of $642M on a base case 5.5 Mtpa start-up concentrate operation and substantial upside potential including becoming a low quartile cost producer. To date, the Company has delineated over 1 billion tonnes of iron under NI 43-101 among its Roche Bay and Tuktu deposits and continues to explore other targeted deposits in areas to the north, south and west of Roche Bay. The management team has extensive technical, exploration and Canadian Arctic mining expertise to effectively develop the high quality iron ore opportunities on the Melville Peninsula.

This news release also includes forward-looking statements that involve a number of risks and uncertainties. The information reflects numerous assumptions as to industry performance, general business and economic conditions, regulatory and legal requirements, taxes and other matters, many of which are beyond the control of the company. Similarly, this information assumes certain future business decisions that are subject to change. There can be no assurance that the results predicted here will be realized. Actual results may vary from those represented, and those variations may be material.

This news release does not constitute an offer to sell or a solicitation of an offer to sell any securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the US Securities Act) or any state securities laws and may not be offered or sold within the United States or to US Persons unless registered under the US Securities Act and applicable state securities laws or an exemption from such registration is available.

NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED WITHIN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

2015
03/21

Category:
Debt Settlement

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Speaker’s Corner: Some lawyers will be unable to resist lure of new debt …

In January of this year, the province enacted the Ontario Collection and Debt Settlement Services Act. The impact on the Ontario debt settlement industry is much like that experienced by Earth millions of years ago after being struck by a gigantic meteor: the extinction of entire species.

While the act’s key provisions don’t come into effect until July 1, 2015, it has already generated a stampede of activity. A disparate group, including some lawyers, are exploring whether or not to provide debt settlement services under the new regulatory regime. Existing debt settlement firms face extinction and the new regulatory regime has created a new biosphere that’s very conducive to Ontario sole practitioners and boutique law firms as well as small Ontario-based collection agencies.

Under the act, unless it falls within an exemption, a debt settlement service provider must not only possess a valid Ontario collection agency licence but it must also comply with the onerous regulatory regime applicable to collection agencies in the province. This requirement is a substantial barrier to entry because it imposes significant costs, including the necessity of having a permanent office located in Ontario, a trust account, a surety bond, and financial disclosure obligations.

Lawyers and licensed bankruptcy trustees, however, are exempt from the Ontario Collection and Debt Settlement Services Act, including any licensing obligations, compliance with the applicable regulatory regime, as well as the punitive new restrictions on fees that come into effect on July 1. The specific language creating the exemption for lawyers under the act reads as follows: “2(1)(1) This Act does not apply to a barrister or solicitor in the regular practice of his or her profession or to his or her employees.”

One of the key provisions of the new act is the draconian limitation on fees charged by firms negotiating lump-sum settlements on behalf of clients. It caps these fees at 10 per cent of the amount of an outstanding account at the time the debt settlement contract is signed. Furthermore, debt settlement firms subject to the act cannot earn a penny in fees until settlement monies are actually paid to a creditor. That may be 17 months after a debt settlement contract is signed or possibly never.

These new limitations on fees will lead to the virtual extinction of existing debt settlement firms in Ontario. Imagine running your law firm in circumstances where the amount of fees you could earn on the average file are very modest and you could not bill 100 per cent of your clients a penny in fees for six to 17 months after opening a file and potentially never be able to do so.

After July 1, an Ontario-based law firm offering debt settlement services will have a huge competitive advantage over a debt settlement provider licensed as a collection agency under the act. Consequently, a number of existing Ontario-based debt settlement firms are currently negotiating with Ontario law firms to become their in-house debt settlement department. This realignment would permit a debt settlement provider to be exempt from the act and the draconian limits on fees.

Lawyers, however, are not going to have the post-July 1 debt settlement biosphere all to themselves. Licensed bankruptcy trustees are also exempt from the act, but I do not envision them negotiating a significant number of lump-sum settlements on behalf of consumers. I anticipate that large credit grantors — particularly the major chartered banks and credit card companies — would take a hard line on approving consumer proposals from any trustee with a reputation for doing a substantial amount of debt settlement work.

It also appears that at some point in the near future, non-profit credit-counselling agencies will become exempt from the act. However, I do not anticipate that non-profit credit-counselling agencies are going to negotiate a significant amount of lump-sum settlements when doing so would be biting the hand that feeds them.

The impending extinction of traditional debt settlement firms will likely encourage some, but not all, small collection agencies to enter the Ontario debt settlement biosphere. Collection agencies are not exempt from the act nor from the harsh restrictions on fees. Collection agencies currently licensed in Ontario, however, satisfy all of the relevant licensing requirements under the act that apply to those providing debt settlement services to Ontario residents.

There are several key reasons why a small Ontario-based collection agency might operate a very profitable debt settlement department as a secondary line of business to its primary focus on providing third-party collection services to creditors. An existing collection agency in Ontario could offer debt settlement services without incurring a penny in additional overhead. Their existing premises — with sophisticated telephone and collection software — are ideal for debt settlement work and their senior management has invaluable contacts among creditors and other collection agencies as well as an insider’s knowledge of potential settlements.

One of the most troubling aspects of the act, however, is it permits the holder of an Ontario collection agency licence to provide not only third-party collection services but also debt settlement services. It is inevitable that this new hybrid debt settlement creature roaming across Ontario providing these two incompatible services will encounter conflicts of interest that, as a practical matter, will more often than not result in the consumer getting the short end of the stick.

Mark Silverthorn is a retired lawyer and the author of The Wolf At The Door: What To Do When Collection Agencies Come Calling, published by McClelland amp; Stewart. He is also the founder of Comprehensive Debt Solutions Inc., a firm providing practical advice to consumers with unsecured consumer debt problems. Its web site is comprehensivedebtsolutions.ca.