Brainhunter Inc.

Brainhunter Inc.

December 02, 2009 12:07 ET

Court Supports Brainhunter's Restructuring

Operations continue uninterrupted

TORONTO, ONTARIO--(Marketwire - Dec. 2, 2009) -


The Board of Directors of Brainhunter Inc. ("Brainhunter or the Company")(TSX:BH) announced today that an order was granted by Madam Justice Pepall of the Ontario Superior Court of Justice (Commercial List) under the Companies' Creditors Arrangement Act ("CCAA") for the Company and certain of its principal subsidiaries providing, among other things, a stay of proceedings against the Company. This means that, with the supervision and protection of the Court, Brainhunter will continue to operate normally while it seeks offers to sell its business or to restructure its liabilities and operations. As one of North America's leading technical staffing and staffing software companies, Brainhunter is continuing all of its current operations during this restructuring process.

Over the past months, Brainhunter, its Board of Directors (the "Board") and financial advisors have conducted an extensive review of strategic alternatives for addressing the Company's debt obligations. After thorough consideration of all alternatives, the Board initiated this action in the best interests of the Company's clients, contractors, employees, creditors and other stakeholders.

Chairman of the Board Don McCreesh said today, "Brainhunter's success is rooted in the strong relationships with our clients and contractors, and we value their support as we take this step to ensure the continuity of our business. Our business is here to stay, and that means we will continue to deliver the high level of service our clients have come to expect from us."

An important element of the filing is a Debtor in Possession ("DIP") interim financing facility, provided by TD Bank. This financing commitment ensures sufficient liquidity for the uninterrupted engagement and compensation of contractors and employees, and therefore uninterrupted service to Brainhunter's valued clients. Further, the Court has approved payment of all pre-filing obligations to the Company's contractors and for a charge on its assets to further protect the contractors.

Brainhunter's Board of Directors has also received and accepted a 'Stalking Horse Bid' from CEO Raj Singh, which has the support of the senior management team. The Company will subsequently be asking the court to approve this bid as part of a court-supervised bid process. The Stalking Horse Bid is effectively an offer to acquire the business as a going concern. It will serve as a reserve bid against which other potential parties can also bid for the Company's assets or offer to sponsor a restructuring plan. This ensures at least one viable and expedited outcome from the restructuring process, and the continuation of the Company's business without disruption of service to its clients.

Brainhunter, like many Canadian companies, has been financially challenged by the general economic downturn. The decision to file under the CCAA was taken after considerable efforts to recapitalize the Company and reduce corporate overhead. McCreesh added, "We regret that this could not be resolved outside the scope of a Companies' Creditors Arrangement Act process. However, we believe that a court-supervised process is the best course of action and will clear the way to implement a long-term, viable solution."

As part of the formal legal requirements of this restructuring, Deloitte & Touche Inc. has been appointed by the Court as Monitor to provide oversight and supervise the CCAA process. Deloitte has posted the materials regarding our restructuring at If you are unable to access this material or have questions of the Monitor, please call 1-877-770-4554 or email

Brainhunter specializes in the provision of staffing solutions (contingent staffing, managed staffing, permanent staffing and staffing software solutions) to major companies and governments in Canada and the United States. Currently, the largest part of the business is providing IT and engineering staffing consultants, on a contract basis, to major companies and government entities in Canada. The Company also sells recruiting related software including applicant tracking systems ("ATS") and vendor management software ("VMS"). Brainhunter deploys over 1,500 contractors with an internal staff of over 160 personnel. Operations are ISO 9001:2000 Certified.

Contact Information