A debtor company operating a glazing and glass manufacturing business brought a motion under s. 50.6 of the Bankruptcy and Insolvency Act seeking approval for debtor‑in‑possession (DIP) financing and an interim financing charge during notice of intention proceedings.
The secured creditor opposed the proposed financing, arguing that the company was not viable and that the charge would prejudice its security position.
The court considered the statutory factors under s. 50.6, including the likelihood of a viable proposal, the trustee’s report, the nature of the debtor’s assets, and potential prejudice to creditors.
Finding that the business would cease operations without interim funding and that the prejudice to the secured creditor was minimal relative to the benefits of continued operations, the court approved a first tranche of DIP financing and granted a corresponding interim financing charge.
