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Canadian Insolvency Law Amendments

BY Joseph J. Bellissimo
November 30, 2009

On Sept. 18, 2009, the Canadian government enacted significant Amendments to Canada's Bankruptcy and Insolvency Act (“BIA”) and Companies' Creditors Arrangement Act (“CCAA”). This article focuses on certain of the Amendments to which equipment financiers should pay particular attention as they may impact how equipment financiers transact business. A more detailed summary of all the Amendments generally can be found at www.casselsbrock.com/CBNewsletter/Canadian_Insolvency_Law_Amendments_in_force_September_18__2009.

Disclaimer of Contracts

The Amendments provide the restructuring debtor with the right to disclaim contracts with the approval of the Monitor/Trustee or the court. Specifically exempted are, inter alia, 1) financing agreements where the debtor is the borrower, and 2) leases of real property or of an immovable if the company is the lessor.

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