FormerXBC Inc XEBEQ

RE:Some Hopeful Info For Shareholders re. CCAA

[Gann999]

Despite all of this the "plan" though it can include shareholders is being decided by the company and national bank who has the company right where it wants them by the balls. So we have a company with new management and no significant skin in the game and national who has xebec by the balls and is "advisor" slash owner of the entire process and completely protected from any litigation by common shareholders who stand to lose everything and have zero say in what happens throughout the process or input into the "plan" moving forward. This is all mind you conveniently timed just mere months before the company is projected to have some cashflow coming in. This whole thing reeks badly of criminality insider trading and intentional incompetence. Somebody should be getting charged but instead they collect cheques so disgusted with this company now.

AlwaysLong683 wrote: Focus has mostly been on the negative to date (including me) given the reality of XBC's circumstances.

However, interesting information courtesy of PwC:

Some excerpts:

"The CCAA....allows a company, if it so chooses, to address its shareholders in addition to its creditors. Typically, when the shareholders of the company are impacted by the Plan of Arrangement, they are often given the opportunity to vote on the Plan...."

 "The Court will issue an Order giving the company 30 days of protection (often referred to as the "Stay") from its creditors to allow for the preparation of the Plan of Arrangement. The Court can extend the Stay against the creditors upon further application to the Court by the company. Typically, the Court will continue the protection beyond the initial 30-day period if the company can demonstrate that it is likely that it will file a Plan of Arrangement and an extension of the Stay is not prejudicial to the creditors, as a whole. There is no time limit on how long the Stay can be extended. During the Stay period, the company will often continue operating, although it may commence restructuring activities at any time."

"Ultimately, the company files its Plan of Arrangement and forwards it to the creditors/shareholders. A meeting of the creditors (and shareholders, if applicable) is called to vote on the Plan. For the Plan to be binding on each class of creditors, a majority of the proven creditors in that class, by number, together with 2/3 of the proven creditors in that class, by dollar value, must approve of the Plan presented to them. If a class of creditors approves the Plan, it is binding on all creditors within the class, subject to the Court's approval of the Plan. If all of the classes of creditors (and shareholders, if applicable) approve the Plan, the Court must then approve the Plan as a final step. Upon Court approval, the company continues forward as outlined under the Plan until it has satisfied the requirements under the Plan."

"If a class of creditors or the Court does not approve the Plan, the company does not automatically go into bankruptcy, but the Stay is lifted. However, once the Stay has been lifted, the pressures that caused the company to initially file for CCAA protection from its creditors will likely return and, accordingly, it is quite likely that the company will be placed into receivership or bankruptcy."

So, in a nutshell, shareholders do have some limited rights during the process and can usually vote on the Plan of Arrangement, but it appears as if the Plan needs to be approved by a majority of creditors before shareholders are included in the vote.

Worth reading the article in its entirety for those who want a good summary of the process from beginning to end.