The Financial Services Regulatory Authority of Ontario (FSRA) and Paliare Roland Rosenberg Rothstein LLP, in its capacity as a court-appointed representative council for investor claimants have, through court-ordered mediation, reached a settlement of claims over the sale of preferred shares of PACE Financial Limited and First Hamilton Holdings Inc.

The settlement will be presented to the Ontario Superior Court of Justice for approval on July 30. Investor claimants who wish to object to the settlement must complete and send a notice of objection by email to PACE and to the law firm representing investor claimants before the close of business on July 23.

If approved and its conditions fulfilled, the settlement contemplates that the settling parties will pay a total of $40-million to the law firm’s trust account for future distribution to investor claimants. The distribution scheme for the funds will be approved by the court at a later date.

In March 2020, the Superior Court of Justice directed the mediation of claims made by investor claimants arising from their interest in the preferred shares and warrants of PACE Financial Limited and First Hamilton Holdings Inc. The firm, the credit union and several investment advisors reached the agreement in June 2021. “The settlement is highly recommended by representative counsel and the representative committee of investor claimants,” Paliare Roland lawyers write in a summary of the case. 

Investor claimants affected by the liquidation proceedings include those who assert or may be entitled to assert a claim or cause of action against one or more of the companies in liquidation, regarding the purchase of PACE Financial Limited Series A 5 per cent cumulative redeemable retractable, non-voting term preference shares and the purchase of equivalent investments in First Hamilton Holdings.

Related: FSRA resumes oversight of PACE Credit Union