A Notice of Intention to make a Proposal (commonly referred to as "NOI") is a procedure under the Bankruptcy and Insolvency Act (“BIA”) that allows financially troubled corporations the opportunity to restructure their affairs. It is often the first stage of a restructuring process under the BIA.
The company is initially granted 30 days of protection from its creditors to enable the company to prepare its Proposal. This protection against the creditors can be extended upon further application (to the Court.
The Court may extend the protection beyond the initial 30-day period if the company is acting in good faith and can prove that it is likely to present a bona fide Proposal and it is not prejudicial to the creditors as a whole.
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Most of the time, the company is still operating and is working on restructuring its operations in order to continue serving its clients and maintaining its relationship with its suppliers and creditors.
Sometimes it has wound down its operations but still needs time to make a Proposal to its creditors that is more favorable than a bankruptcy.
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