I don't think the judge will say three times you're out. I think that he will say something along the lines of, "You requested extensions and XX months have gone by and still no Plan, so you're done here." The filings show Fung asked for more time to negotiate the Plan because of attorney summer vacations, or something like that. Also, the last company filing indicated the company felt there was no compromise with a week left in that current Stay. Company did not work until the 11th hour? Uh Oh. The lack of a Plan at this point might be seen as stalling, as well as not taking the process seriously.
Mediation is meant to bring the parties together, not to fill time in the middle of, what appears to be hoped for by many here, ongoing and continued Stays. If the court did not want a Plan done, sooner rather than later, why the mediation? Why the recent relatively shorter Stays? Why order(s) for a Plan? More appropriate would be 90 day Stays, and kick back and watch the world go by. But, that is not recent events.
CCAA Plan formation is by the company. The creditor, in this case the Noteholders, tells the company their wishes, and the company comes back with what they are willing to do, currently with Campbell as a "mediator." The company likely already is well aware of what will fly. Eventually a Plan pops out. Or not. Mediation will hopefully bring them together. Campbell is not really there to mediate. Management and Noteholders know how to negotiate, they are pros, and likely buds out of the negotiation room. Campbell is there to remind the parties of the gravity of the situation. Speculate Fung will use this as an "out" when it comes to explaining to shareholders any give-away. No one - neither side - holds all the cards at this point.
CCAA does not dictate that creditors or the company must be, "reasonable," in making a Plan. If anyone can find, "Plan negotiation being reasonable," anywhere in CCAA guidance, please post the link. This is a shareholder hope and wish. Shareholders typically lose out completely in companies that go the CCAA route, whether a Plan is agreed on or not. That can be verified in the CCAA history. Companies coming out of CCAA without a Plan were scuttled. And, I would venture to say that every one of those companies thought the creditors were being, "unreasonable." Yet, it happened. Company Finished. The creditors did not make the company get into the position the company placed itself in, having to go to CCAA. The company management did that.
It is possible that there will be continued and ongoing Stays, but that seems more hope than reality with the previously mentioned recent events. Ignore the recent events and get bit in the rump. Some need to understand that there is another, very real, possibility - that this CCAA could come to a conclusion very quickly. It is not what folks want to read, but it is just as possible as continuing and ongoing Stays.
