Division 1 Business Proposal to Creditiors

A proposal provides an option for percentage settlements or an extension of time for repayment of debts. Ownership of assets and management of the business remains with the debtor. A Division 1 Proposal can also be used by individuals whose debts are greater than $75,000 (not including mortgage on a principle residence).

A proposal can be created with the help of a Trustee and, if accepted by the creditors and The Court, becomes a legally binding agreement between the debtors and the creditors.

A proposal is a viable alternative to bankruptcy when there is a core business that is viable in the long run. Creditors will realize a greater recovery while the debtors company, once it has met its obligations as outlined under the proposal, sees its liabilities extinguished.