In Making a Proposal Under the Bankruptcy and Insolvency Act

question 72

Multiple Choice

In making a proposal under the Bankruptcy and Insolvency Act, a composition would be most attractive to a creditor where

• A)the debtor is generally able to pay its debts as they come due.
• B)the creditor will receive more if the debtor is permitted to continue to operate under the proposal, than if the debtor is forced into bankruptcy.
• C)the debtor does not want to part with voting control over the company.
• D)the debtor cannot be trusted to pay its debts.
• E)the debtor has given a security interest to the creditor in assets that, if sold, would yield proceeds exceeding the amount of the debt.

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