Demonstrating that dissenting creditors are no worse off under a contested restructuring plan than in the relevant alternative is an essential requirement for the court to exercise its power to sanction the plan

The power of the court to sanction a restructuring plan where one or more classes of creditors or members has not voted in favour of the plan by the requisite majority (being 75% in value of those present and voting) is referred to as the "cross-class cram down".

A Case Comment on AssessNet Inc. v. Ferro Estate, 2023 ONCA 577

Demonstrating what would most likely happen if a restructuring plan were not sanctioned is an essential element for the exercise of the court's discretion to cram down the votes of dissenting creditors

Restructuring plans under Part 26A of the Companies Act 2006 (CA 2006) may provide an alternative for companies in financial distress to formal insolvency (see our previous Insight).

Restructuring plans can provide companies in the early stages of financial difficulty with a flexible alternative to entering a formal insolvency procedure

Under Part 26A of the Companies Act 2006 (CA 2006), companies or groups encountering financial difficulties affecting their ability to carry on business can propose a compromise or arrangement (a restructuring plan) which mitigates or eliminates the effects of those financial difficulties.

Introduction

There may be hope on the horizon for insolvent Canadian cannabis companies who wish to seek recognition proceedings south of the border.

The enforcement of court orders that are designed to preserve, trace or track crypto-assets within North America is often limited in practice. As seen in the recent Ontario decision of Cicada 137 LLC v. Medjedovic (“Cicada”),^[1] mechanisms by which legal enforcement principles can be effectively applied against stolen or misappropriated crypto-assets are constrained.

The preliminary draft of the law on structural changes of commercial companies approved by the Spanish Government on 14 February (the "Preliminary Draft") aims to transpose Directive (EU) 2019/2121 of the European Parliament and of the Council of 27 November 2019 amending Directive (EU) 2017/1132 regarding cross-border transformations, mergers and demergers of companies

There are many practical steps, pitfalls and strategies available for recovering commercial rent arrears, both before and after tenant insolvency

Spotting the warning signs of distress in your construction supply chain and taking early action can significantly reduce the impact on your projects

While insolvency events may appear to arise suddenly, there are often warning signs or "red flags" of distress well in advance. While these do not necessarily demonstrate actual insolvency, they can indicate liquidity and solvency risks to the supply chain.