Deed Of Company Arrangement (DOCA)

One of the benefits of a DOCA is that it helps maximise the chances of your company continuing, or to provide a better return for creditors.

What is it?

A DOCA is a binding agreement between a company and its creditors that governs how the company’s affairs will be dealt with.

The process

If a DOCA is executed, then the administrator of your company will become administrator of the DOCA unless your creditors resolve otherwise.  Your company must also execute a DOCA within 15 business days after the second creditors’ meeting. If this doesn’t happen, then the company will automatically go into liquidation, with the voluntary administrator becoming the liquidator. A DOCA also binds all unsecured creditors whether or not they voted against the proposal.

What you need to do

If your creditors vote to go down the path of a DOCA, you must execute one within 15 business days. If you are a creditor, before you decide how to vote, make sure you understand how the deed will affect the priority of payment of your debt or claim.

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