Best answer: What is CCAA protection?

The Companies’ Creditors Arrangement Act (commonly referred to as the “CCAA” or the “CC, double A”) is a Federal Act that allows financially troubled corporations the opportunity to restructure their affairs. … The process begins in the Court system when the company applies to the Court for protection under the CCAA.

What happens after CCAA?

A: Pursuant to most CCAA Orders, generally all payments to creditors owed monies, as of the date of the CCAA filing, are stayed pending the creditors’ vote on the Debtor’s proposed plan of arrangement and compromise (the “Plan”).

How long does CCAA last?

The Court has granted CCAA protection for an initial period of 30-days, which may be extended for a period that the Court deems appropriate. The Company will work to complete its restructuring in a timely fashion, though there is no standard timeframe for the duration of CCAA proceedings.

What does creditor protection mean?

The Companies’ Creditors Arrangement Act allows companies to reorganize under court supervision, while keeping creditors at bay. … While under protection, a plan to reorganize the company is developed, and a “monitor” is appointed by the court in order to supervise the process.

How does the CCAA work?

The Companies’ Creditors Arrangement Act (commonly referred to as the “CCAA” or the “CC, double A”) is a Federal Act that allows financially troubled corporations the opportunity to restructure their affairs. … The process begins in the Court system when the company applies to the Court for protection under the CCAA.

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What happens to shareholders in CCAA?

What happens to shareholders? Holders of common stock are typically last on the list. Quite often in CCAA proceedings, they get back none of the money they invested. Their old shares become worthless and often new shares are issued in the restructured company.

What is a DIP lender?

Debtor-in-possession (DIP) financing is financing for firms in Chapter 11 bankruptcy that allows them to continue operating. The lenders of DIP financing take a senior position on liens of the firm’s assets, ahead of previous lenders.

What is a monitor in insolvency?

A monitor is generally an accounting or financial advisory firm that must also be licensed to act as a trustee in bankruptcy under the Canadian Bankruptcy and Insolvency Act which is a federally regulated licensing program.

Is EPF creditor proof?

Your savings with the Employees Provident Fund (EPF) is creditor proof and cannot be claimed by the Director General of Insolvency, unless and until EPF pays any amount payable to you.

How do I become a creditor proof?

Ten Ways To Make Yourself “Creditor Proof”

  1. Close any bank accounts at financial institutions where you have credit cards, personal loans, lines of credit, or your mortgage.
  2. Sell your real property (house).
  3. Avoid ownership of property in your own name.
  4. Drive an inexpensive Car.
  5. Close your chequing or savings accounts.

Are creditors protected?

Adequate protection of creditor’s rights is as important as those of the debtor, given that quick and efficient insolvency proceedings rest upon a balance of power between debtors and creditors.