, which chronicled Fakih’s hardworking days as a businessman, philanthropist and family man that sometimes began as early as 4 a.m.Sign up to receive daily headline news from the Calgary Herald, a division of Postmedia Network Inc.By clicking on the sign up button you consent to receive the above newsletter from Postmedia Network Inc. You may unsubscribe any time by clicking on the unsubscribe link at the bottom of our emails. Postmedia Network Inc.
After failing to get the answers they were seeking from Fakih, the Kuwait-based investors retained A. Farber & Partners Inc. to assess the state of the business and potential restructuring options. They say the report revealed Fakih and his company, Fakih Group Inc., owe nearly $12 million to the business.
Fakih disputes the allegations and took action against his business partners last year, accusing them of failing to live up to their obligations to the business.Article content Part of that fundamental understanding was that “Mr. Fakih and the Noureddine Parties would promptly fund all operational shortfalls or required capitalization for the ongoing business pro rata with their respective shareholdings,” the documents claim, and “to the extent that Mr. Fakih’s role in the management of Paramount led to any potential personal liability, the Noureddine Parties would indemnify and hold Mr. Fakih harmless in proportion to their shareholdings.
Further, Fakih accuses his business partner of “directly pressuring and instructing Paramount employees to pressure business counterparties, making representations and commitments on behalf of Paramount to business counterparties without authorization, and ultimately withdrawing those commitments without regard to the resources wasted in the course of negotiations, all of which gave rise to strained relationships and in some cases led to disputes and litigation.
Reached by phone, Fakih said his investors are attempting to use a counterclaim to an action he filed demanding they fulfil their financial obligations to him to damage his reputation “because I’m going after them hard to get my money.”Article content “They’re just throwing dirt because they know my reputation is very important to me,” he said. “The company is viable and it’s worth saving.”Article content
“In summary, the status quo does not appear to be sustainable without a substantial capital injection or corrective action,” the report says. “The Company appears to be continually fighting fires to manage its day-to-day cash position, is burning cash and appears to have no long-term plan to address debt levels. On both a balance sheet and cash flow basis, the Paramount Group is insolvent.
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