Frequently Asked Questions About The Companies' Creditors Arrangement Act (CCAA):
Q# 1. Question: What is the CCAA?
#1 Answer: The CCAA, or the Companies’ Creditors Arrangement Act, is a federal law in Canada that provides insolvent companies with debts in excess of $5 million an orderly and court-supervised means to restructure their business. The Court has granted a “stay of proceedings,” which prevents creditors, such as lenders and suppliers, from taking action against the Company, its directors and officers, and its assets to allow the company to focus on its restructuring objectives in an orderly and efficient manner.
CCAA protection provides companies with the time and “breathing room” necessary to emerge as a successful, going concern business and to position the business as a stronger, more competitive company.
Q# 2. Question: Is the company bankrupt?
#2 Answer: No, the company is not bankrupt, it is engaged in a going-concern restructuring and is continuing to operate in the normal course. It is business as usual during the CCAA proceeding.
Q# 3. Question: I am a vendor and my invoices have not been paid. How do I get them paid?
#3 Answer: The company is prevented by Court Order and the federal CCAA statute from paying amounts incurred before the filing date (July 3, 2023). Depending on when the payment obligation arose and when the product was actually supplied, the company may not be able to pay your invoice. If the company is not able to pay your invoice because of the Court Order or CCAA, you may have a claim that you can assert in a future court-approved claims process conducted by the Monitor.
If you have any questions about when the payment obligation arose under your invoice, please contact Grant Thornton at: https://www.grantthornton.ca/service/advisory/creditor-updates/#Big-Erics-Inc-&- Terra-Nova-Old-Port-Foods-Inc.
Q# 4. Question: How can I receive information related to the Claims Process?
#4 Answer: If a Claims Process is approved by the Court, all creditors of record will receive notice from the Monitor regarding next steps. The Claims Process Order, if one is sought and obtained from the Court, would also be posted on the Monitor’s website noted above. In the meantime, please continue to submit any invoices to the Company through the normal channels.
Q# 5. Question: I do not wish to supply going forward because my outstanding account has not been paid.
#5 Answer: The [ARIO] Initial Order prevents any party from discontinuing services to the company provided pursuant to written [oral per ARIO section 18] agreement for reason of non-payment of pre-filing amounts. Please contact us to discuss supply arrangements going forward.
Q# 6. Question: Will I be paid for goods supplied to the company after the date of the Initial Order on July 3rd, 2023?
#6 Answer: The company is required by Court Order to pay for all supply of goods after the date of the Initial Order. If an order is made after July 3rd, 2023 and the goods actually supplied, the Company is required to pay the invoice.
Q# 7. Question: I heard that I can recover goods for the 30 days leading up to the start of the CCAA proceedings. Can I come and take back my product that hasn’t been paid for?
#7 Answer: No. Those rights exist in a bankruptcy proceeding and not under a CCAA restructuring proceeding. Under the CCAA vendors and other creditors are prohibited from repossessing goods previously delivered to the Company.