Ontario Barrister and Solicitor Practice Exam

What is generally the first step in corporate restructuring under the BIA?

1. Liquidating company assets

2. Passing a resolution at a shareholders meeting

3. Filing for bankruptcy

4. Negotiating with creditors

The correct answer is: Passing a resolution at a shareholders meeting

The first step in corporate restructuring under the BIA (Bankruptcy and Insolvency Act) is typically passing a resolution at a shareholders meeting. This is because the shareholders have a significant stake in the company and their approval is required for any major decisions, such as the decision to undergo corporate restructuring. This option is the correct answer because it is the initial step that begins the legal process of restructuring. The other options, while they may be involved in the restructuring process, are not typically the first step. Liquidating company assets, filing for bankruptcy, and negotiating with creditors may all occur later in the process, but they are not the initial action taken to initiate corporate restructuring.