MIRA
INFORM REPORT
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Report Date : |
14.04.2007 |
IDENTIFICATION
DETAILS
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Name : |
TEMBEC ENTERPRISES INC. |
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Registered Office : |
800 Bol. Rene Levsoue, Suite No. 1050, Montreal, Quebec - H3B 1X9 |
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Country : |
Canada |
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Date of Incorporation : |
16/08/2001 |
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Legal Form : |
Federally Chartered Corp. - Private |
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Line of Business : |
Manufacturer of a variety of paper and wood products. |
RATING &
COMMENTS
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MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Status : |
Satisfactory |
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Payment Behaviour : |
Usually correct |
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Litigation : |
Clear |
IDENTIFICATION &
EXECUTIVE SUMMARY
Company Name: TEMBEC ENTERPRISES INC.
Address: 800 BOL. RENE LEVSOUE
SUITE NO. 1050
City: MONTREAL
State/Province: QUEBEC
Zip Code: H3B 1X9
Country: CANADA
Telephone: 514-871-0137
Facsimile: 514-397-0896
In KCAD As of: 30/09/2006
Sales / Revenue: 903,000
Net Income:
Total Equity:
Legal Form: Federally Chartered Corp. - Private
Website: www.tembec.com
Business Activity: The
Company is manufacturer of a variety of paper and wood products.
NOTE TO CLIENT
NOTE::LEGAL NAME: TEMBEC
ENTERPRISES INC.
ORDERED NAME: SPRUCE FALLS
INC.
PLEASE NOTE THAT THE COMPANY NAME WAS CHANGED IN JANUARY 2007 AFTER A
CORPORATE RESTRUCTURING.
Person Contacted: Mr. Reginald
Bastien, Director of Taxation. He
verified and updated the information presented to him.
Please note that due to the Subject's recent corporate restructuring,
Mr. Bastien could not provide an exact employment figure, however, he did say
the company has between 5000 and 6000 employees.
The following is the Subject's Current Parent Company Structure:
Immediate Parent: SPRUCE FALLS ACQUISITION CORP.
Ultimate Parent: TEMBEC
INDUSTRIES INC.
IMPERATIVES
Found on the Government of Canada Website:
Spruce Falls Inc., A Division of Tembec Inc., Pleaded Guilty to Charges
Under the Fisheries Act
Montreal, Quebec, May 16, 2006 – Spruce Falls Inc., a division of Tembec
Inc. that operates the industrial complex in Temiscaming in Quebec, appeared
yesterday before a Quebec Court judge and pleaded guilty to charges under the
Fisheries Act. Spruce Falls Inc.
pleaded guilty to having deposited a deleterious substance
(final effluent from the
biological treatment system) into the Ottawa River 16 times between April 9,
2003, and December 14, 2004, in violation of subsection 36(3) of the Fisheries
Act. In addition, the company twice failed to monitor final effluent from the
biological treatment system. Lastly, between March 1 and June 14, 2004, Spruce
Falls Inc. partially ignored a direction issued by an inspector under 38(6) of
the Fisheries Act requiring the implementation of measures to prevent further
deposits of deleterious substances from occurring.
The $750,000 penalty that Spruce Falls Inc. was ordered to pay consists
of a $250,000 fine and a $500,000 payment to the Environmental Damages Fund,
administered by Environment Canada. The judge based the decision on a
submission submitted jointly by the Crown and the defence. Company officials
attested to the fact that an anaerobic effluent treatment system was fully
installed at the Témiscaming industrial complex and that the system has been in
operation since January 2006. The payment to the Environmental Damages Fund
will be used to promote rehabilitation projects. Local community and
environmental groups will have an opportunity to submit project proposals for
the funds. The Environmental Damages Fund ensures polluters take responsibility
for offences and gives courts a way to guarantee that money is directly
invested to improve the quality of the environment.
The charges were laid following an investigation by Environmental
Enforcement officers of Environment Canada — Quebec Region. Environment Canada
investigates potential pollution offences under the Canadian Environmental
Protection Act, 1999 and Canada's Fisheries Act. They help ensure that
companies, government employees and the general public comply with legislation
and regulations that protect Canada's environment.
LEGAL
Legal Form: Federally
Chartered Corp. - Private
Since (D/M/Y): 16/08/2001
State/Province of Incorporation: Canada
Status:
ACTIVE
Previous Legal Form:
Company is NOT required to publish an annual financial report.
The Company federally chartered in Canada under the following
registration.
Corporation #3934284
Corporation Name(s): Tembec Enterprises Inc./
Les Entreprises Tembec Inc.
Old Name(s) and Change Date(s)
SPRUCE FALLS INC. - 2007/01/09
Mailing Address: [Latest address on file]
Care of:
Street: 800 RENÉ-LÉVESQUE BLVD. WEST SUITE 1050
City: MONTREAL
Province: Quebec
Postal Code: H3B1X9
Country: Canada
Registered Office Address: [Latest address on file]
Care of:
Street: 800 RENÉ-LÉVESQUE BLVD. WEST SUITE 1050
City: MONTREAL
Province: Quebec
Postal Code: H3B1X9
Country: Canada
Reg. Off. Eff: 2007/01/09
Status: Active
Incorporation Date: 2001/08/16
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The Company provincially qualified in Quebec under the following
registration.
Incorporation Number: 1147592696
Legal Name: LES ENTREPRISES TEMBEC INC.
Incorporation Date: 12/1/1991
Last Annual Report: 1/13/2007
Location: Canada
Address: 800 BOULEVARD RENE-LEVESQUE OUEST SUITE 1050
MONTREAL (QUEBEC)
H3B 1X9
Registered Agent: TEMBEC INC.
R/A Address: 800, BOUL. RENE-LEVESQUE OUEST # 1050
MONTREAL QC
Managers/Key
Personnel
Mr. Jim Lopez President
Mr. Antonio Fratianni
Secretary
Mr. Reginald Bastien
Office Manager
AFFILIATED ENTITIES
Mr. Bastien stated that the Company has several affiliates. The following is a sample of these affiliates:
Tembec Tarascon SA
France
Tembec USA LLC
USA
Arc Resin Corp.
USA
Tembec St-Gaudens SA France
TEMBEC INVESTMENTS INC.
TEMBEC INC.
Parent Companies
Parent Company: SPRUCE FALLS
ACQUISITION CORP.
1, MACPHERSON AVENUE
KAPUSKASING ON
CANADA
Ultimate Parent: TEMBEC
INDUSTRIES INC.
800
RENE LEVESQUE SUITE 1080
Montreal PQ
CANADA
The following is selected stock price and financial statement
information for TEMBEC INC., (An affiliated company) which trades publicly on
the Toronto Stock Exchange under the symbol TBC.
As of 4/13/2007 in Canadian Dollars
Stock Price: 1.720
52 Week High: 3.150
52 Week Low: 1.090
Shares Outstanding: 85,616,232
Fiscal Year End: 12/31/2006 in Thousands of Canadian Dollars:
Total Assets: 3,017,000
Total Liabilities: 2,429,000
Total Equity: 588,000
Net Sales: 3,411,000
Net Income: -304,000
The Company has no subsidiaries.
BANKS
National Bank of Canada
Montreal PQ
Telephone: 514 331-2633
Facsimile:
Account Number:
Account Manager:
This bank only provides credit information to other banks.
PQ
Telephone:
Facsimile:
Account Number:
Account Manager:
Tembec Inc. and the Subject currently have a joint available credit
facility of CAD 250 Million through CIT Business Credit Canada.
PAYMENT HISTORY
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Supplier's Name/Industry Terms Amount/Pay Habits/Comments
Rptd
Open Credit Credit
High Total Current
Past Due/Pay Period
Date
Date Limit Limit Dt. Credit Owing $ 1st
2nd 3rd
------------------------------------------------------------------------------
GESCAN DISTRIBUTION: 604-606-0004
*Apr 0
152K 7,527 0
3,017 4,510 0
Wholesale-Elec Appls:
*Apr 0
15,000 3,249 3,249
0 0 0
Mfr-Paint, Varnishes:
*Apr
0 450 450 450 0
0 0
Whlsl-Professnl Equp:
*Apr 0
2,705 2,705 1,388
1,317 0 0
Transportation Serv:
*Mar 0
31 31 31
0 0 0
Arrg Transp of Freig:
*Mar 0
169 169 157
12 0 0
Business Services:
*Mar 0
7,000 6,083 6,083
0 0 0
DICOM EXPRESS INC.: 514-636-8033
*Mar 0
109 109 56
53 0 0
Whlsl-Ind Mach Sppls:
*Mar 0
284 284 0
284 0 0
Trucking: Merged accts
*Mar 0
14,047 14,047 10,314
3,733 0 0
Whlsl-Plumbing/Heatg:
*Mar 0
96 96 96
0 0 0
Whlsl-Electronic Pts:
*Feb 0
235 235 0
235 0 0
Personal Services:
*Feb 0
38,834 38,834 21,436
17,398 0 0
Mfr-Pump & Pumping E:
*Feb 0
26,831 26,831 26,831
0 0 0
Mfr-Audio/TV Equip:
*Jan 0
200 9 9
0 0 0
Mfr-Petroleum Prdts:
*Jan 0
543K 543K 543K
0 0 0
Whlsl-Ind Mach Sppls: Merged accts
*Jan 0
807 807 807
0 0 0
Whlsl-Ind Mach Sppls:
*Jan 0
398 398 398
0 0 0
Mfr-Primary Metal:
*Jan 0
11,888 1,795 1,795
0 0 0
-------
------- ------- ------- ------- -------
P.I. =
2 90 Days 815K
647K 616K 26,049
4,510 0
Reported ------- ------- ------- ------- -------
-------
Mfr-Inorganic Chemcl:
*Jan 0
202K 202K 183K
18,268 0 104
Mfr Fabricated Metal:
*Jan 0
173 173 0
173 0 0
Mfr-Engine:
*Nov 0
3,000 601 0
601 0 0
Whlsl-Ind Mach Sppls:
*Oct 0
7,966 7,966 5,976
1,990 0 0
Trucking:
*Oct 0
13,027 13,027 10,384
2,643 0 0
Whlsl-Ind Mach Sppls:
*Jul 0
65,469 319 319
0 0 0
Trucking:
*Jun 0
122 122 0
0 122 0
DE LAGE LANDEN FIN: 905-465-3160
*Apr 0
32,699 1,735 1,735
0 0 0
Whlsl-Ind Mach Sppls:
*Apr 0
95 95 95
0 0 0
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------- ------- ------- ------- -------
P.I. =
3 Total 1,140K 873K 819K 49,724
4,632 104
Reported -------
------- ------- ------- ------- -------
PAYMENT
TRENDS
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Payment C.I. Number of Total
Current Overdue
Quarters
Index Score Suppliers
Owing $ 1st 2nd 3rd
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1 Qtr/2007
2 6 20
850,746 802,297 45,777
2,568 104
4 Qtr/2006
6 6 18
1,308K 1,057K 250,281 0 104
3 Qtr/2006
3 9 17
1,108K 1,021K 85,913
775 104
2 Qtr/2006
2 9 19
929,179 888,745 38,818
1,537 79
1 Qtr/2006
5 13 18
1,060K 922,424 125,965
592 11,491
4 Qtr/2005
5 19 19
1,177K 1,027K 107,554
42,863 71
3 Qtr/2005
3 12 17
1,111K 1,024K 82,053
3,610 807
2 Qtr/2005
16 6 18
1,665K 1,097K 353,143
213,565 1,046
1 Qtr/2005
3 9 18
1,128K 1,033K 94,434
360 706
FINANCIAL INFORMATION
FINANCIAL FIGURES
Year-End (D/M/Y):
30/09/2007
30/09/2006 30/09/2006
Projected Consolidated
Sales / Revenues
2,000,000
903,000 -
Mr. Bastien declined to provide financial statement information for this
report, citing company policy, however, he did state net sales for fiscal year
end September 30, 2006 were CAD 903 Million.
He stated net sales for September 30, 2007 should be approximately CAD 2
Billion due to the Subject's restructuring.
CURRENT OPERATIONS
NAICS Code: 32212 Paper Mills
NAICS Code: 3221 Pulp, Paper, and Paperboard Mills
Business Activity:
The Company is manufacturer of a variety of paper and wood
products. The Subject is split evenly
between the following business operations
Pulp Mill
Saw Mill
Paperboard Converter
The Company imports and exports worldwide. The heading address is the headquarters for the Subject. The facility consists of leased office
space.
The Company has several plant and warehousing facilities located in four
provinces: British Columbia, Manitoba, Quebec, and Ontario.
PUBLIC RECORD
A search of public revealed the following actions against the Company
and no bankruptcy petitions. We could not determine the status of the actions
at this time.
Writ of Summons:
Defendant SPRUCE FALLS INC Date
Oct 31, 2005
Plaintiff 9057 3692 QUEBEC INC Court
Provincial Cour
Amount 42,526 Location Matane
Reason Goods Sold &
Delivered File # 000643048
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Writ of Summons:
Defendant SPRUCE FALLS INC Date
Apr 06, 2004
Plaintiff 9057 3692 QUEBEC INC Court
Provincial Cour
Amount 42,526 Location Quebec
Reason Goods Sold &
Delivered File
# 028368041
GENERAL COMMENTS
The Subject, federally registered in Canada in 1991, is engaged as an
paperboard converter, pulp mill and saw mill.
The payment record was generally satisfactory and the operating history
is clear. Two actions were found
against the Company, however, no bankruptcy petitions were reported or
noted. The Company is responsible for
normal business transactions.
RATING
EXPLANATIONS
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
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71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
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56-70 |
A |
Financial & operational base are regarded healthy. General unfavourable
factors will not cause fatal effect. Satisfactory capability for payment of
interest and principal sums |
Fairly Large |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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26-40 |
B |
Unfavourable & favourable factors carry similar weight in credit
consideration. Capability to overcome financial difficulties seems
comparatively below average/normal. |
Small |
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11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
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<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
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NR |
In view of the lack of information, we have no basis upon which to
recommend credit dealings |
No Rating |
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This score serves as a reference to assess SC’s credit risk
and to set the amount of credit to be extended. It is calculated from a composite
of weighted scores obtained from each of the major sections of this report. The
assessed factors and their relative weights (as indicated through %) are as
follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)