For more information about CCAA and FAQs please click HERE.
BIG ERICS INC. HAS TAKEN THE FIRST STEP TO BOTH PROTECT AND RESTRUCTURE THE COMPANY.
Big Erics Inc. has taken the first formal step to initiate a restructuring process under the Companies Creditors Arrangements Act (CCAA), by filing for an immediate stay of proceedings under the Bankruptcy & Insolvency Act.
For more than 3 years Big Erics has been on an extremely challenging journey, like many of its incredible employees, customers, suppliers and others. All have had to endure the unprecedented financial and emotional impact of all that came with the COVID 19 pandemic, which unbelievably has been followed by ongoing and unpredictable increases in interest rates and inflation, etc.
Like so many if it’s customers, independent suppliers, and others, during this period Big Erics has had to turn to government wage support programs and Federal government supported and private loans. Those things were critical to enable the company to maintain the jobs of loyal and amazing team members who remain dedicated to supporting customers and suppliers in every way possible.
However, during this time, the monthly costs of supporting the government loans have increased way beyond any predictable interest rate levels when borrowed. Now, as of July 2023, the government supported loans programs require that Big Erics pay much heavier than expected payments, of both principal and interest.
While many industries, including food service and hospitality, have been lobbying government for extensions and other accommodations, to allow borrowers to reduce payments and pay over a longer period of time, such changes to the government controlled programs have not been approved.
So an alternative opportunity that remains for some borrowers is to take advantage of Federal legislation that allows borrowers and operators to take sanctuary in a court controlled “stay of proceedings”, where some loan payments and other obligations are suspended, while the Company continues to operate and develops a restructuring plan to put before its creditors to consider, under the supervision of a Judge and professional monitor. The time period that is available to finalize an acceptable plan is also controlled by the Judge, who considers the interests of all stakeholders.
Big Erics is proceeding to utilize that Federal legislation and will develop and present a plan to move beyond the unbearable burden of the current requirement for repayment of Federal program loans, etc.
With over 75 years in business, an amazing Team of loyal and talented employees, so many customers that remain determined to carry on through this shared adversity, and wonderful and creative suppliers who continue to be committed to support the food service and hospitality industries, we will restructure and be there to support all our stakeholders for many years to come.
While pursuing the CCAA process, BIG ERICS WILL CONTINUE FULL OPERATIONS. Throughout the sun will rise every morning and set every evening on our continuing journey together.
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For more information about CCAA and FAQs please click HERE.