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Initial CCAA order granted for Cinram Group, including DIP financing, KERP, and various priority charges.
The applicants, comprising the Cinram Group, sought an Initial Order under the CCAA.
The court found that the applicants were debtor companies and insolvent, facing a looming liquidity crisis.
The court granted the Initial Order, which included a stay of proceedings extended to non-applicant subsidiaries, authorization to pay critical pre-filing obligations, and approval of various charges including a $15 million DIP financing charge, a $3.5 million administration charge, a $13 million directors' and officers' charge, and a $3 million KERP charge.
The court also authorized the foreign representative to seek recognition under Chapter 15 of the US Bankruptcy Code.
Foreign judgment creditor could invoke bankruptcy without exhausting other collection remedies.
A foreign judgment creditor appealed the dismissal of a petition for a receiving order under the Bankruptcy and Insolvency Act based on an unpaid Ohio civil judgment arising from a fatal boating collision.
The Court of Appeal held that the bankruptcy judge erred in treating the foreign plaintiffs as a single creditor and in requiring the petitioning creditor to exhaust other civil enforcement routes before invoking the bankruptcy regime.
The court found there were at least three creditors, substantial unpaid liabilities under a final foreign judgment, and evidence of suspicious asset transfers that made bankruptcy remedies appropriate.
The appeal was allowed, the debtor was adjudged bankrupt, and a trustee was appointed.
