25 million loan, not needed an part of the design to transfer to expropriate Canwest shares
DIP Financing. In many cases, the court will authorize debtor-in-possession or “DIP” financing to the debtor and grant super priority charges over the assets of the debtor in favour of the DIP lender, if the court is of the view that additional financing during the restructuring is critical to the continued operations of the business.
This may be done in the initial order at the time of first application, or subsequently, typically by way of an amendment to the initial order. Canada has not adopted the U.S. concept of “adequate protection”, which is intended to protect existing lien holders who have become subject to super-priority charges.
Canadian courts also do not need to authorize “replacement liens” because a pre-filing secured creditor’s security, if granted over after-acquired property (as typically would be the case), continues to apply and automatically extends to post-filing assets acquired by the debtor.
