{"id":18648,"date":"2021-12-14T14:43:37","date_gmt":"2021-12-14T19:43:37","guid":{"rendered":"https:\/\/www.bernierfournieravocats.com\/?post_type=expertise&p=18648"},"modified":"2022-07-12T14:59:13","modified_gmt":"2022-07-12T18:59:13","slug":"corporate-reorgization-and-restructuring","status":"publish","type":"expertise","link":"https:\/\/www.bernierfournieravocats.com\/en\/expertise\/bankruptcy-and-restructuring\/corporate-reorgization-and-restructuring\/","title":{"rendered":"Corporate reorgization and restructuring"},"content":{"rendered":"

Corporate reorganization<\/h3>\n

When a business\u2019s financial or structural needs change, often as a result of a business growth, organizational adjustments may be necessary: this is referred as a corporate reorganization. This can take the form of a corporate merger, a family trust or new shares, to name a few examples.<\/p>\n

Forced with these major organizational changes, it may also be necessary to review certain corporate documents, including the Shareholder\u2019s Agreement<\/a>. The reputed professionals of the Bernier Fournier firm can guide you as to the steps to take in the event of a corporate reorganization. Notably, they will know how to adapt the agreements according to the changes you wish to make to your business and will also be able to advise and guide you with regard to your legal obligations and business decisions.<\/p>\n

Corporate restructuring<\/h3>\n

There are several ways that incorporated businesses can anticipate the end of their activities and protect the interests of their employees, directors and creditors.<\/p>\n

Small or large corporations<\/span><\/p>\n

Under the Companies\u2019 Creditors Arrangement Act<\/a>1<\/sup><\/em>, a large corporation may, under certain conditions, apply to court to have the rights of its creditors suspended, in order to restructure and continue its operations. This law has also been used for the restructuring of several large renowned businesses such as Air Canada, Stelco, San Francisco Stores and Quebecor. Smaller businesses also have remedies to promote their rehabilitation and avoid liquidation of their assets under the Bankruptcy and Insolvency Act<\/a>2<\/sup>.<\/em><\/p>\n

Purpose of the Companies\u2019 Creditor Agreement Act<\/em><\/span><\/p>\n

Indeed, the legislator, by adopting this law, wanted to promote the restructuring of companies under judicial supervision in order to allow the continuity of their operations and to avoid all the harmful consequences to the closure of these. In short, it gives the companies concerned a second wind prior to prevail on the bankruptcy process.<\/p>\n

Among the procedures to be followed is the immediate filing of a proposal3<\/sup>\u00a0or of a notice of intention to make a proposal to one\u2019s creditors alongside the official receiver in the \u00ab locality of the owner \u00bb4<\/sup>.<\/p>\n

It is also possible to have to restructure without leaving the company in a critical debt state. Changes in the market and funding, lawsuits and changes in administration or ownership are all factors that may lead to the need for restructuring. The restructuring of a business affects many legal areas since it has an impact on the taxation of businesses, but also on their employees.<\/p>\n

Layoffs due to corporate restructuring<\/span><\/p>\n

Sometimes, layoffs may be necessary in order for the business to survive. Even in these cases of legitimate dismissals, the employer will have to take into account the legal and financial implications in relation to labour law<\/a>.<\/p>\n

Effects due to corporate restructuring<\/span><\/p>\n

The restructuring frees up funds to allow the resumption of activities by temporarily suspending the right of creditors to seize company assets, all under the supervision of an official appointed by the Tribunal. In addition, the following operations may be necessary:<\/p>\n