What Is Debtor-in-Possession (DIP) Financing?

DIP financing is a type of debt financing provided to a company that is in bankruptcy or undergoing formal restructuring, such as under Canada's CCAA. Also known as debtor-in-possession financing, it allows the company to continue operations while it develops a restructuring plan to pay off creditors. DIP loans are often secured by a company's assets and are typically granted a super-priority status by the court to ensure they are repaid before other debts.

Learn More

Understanding DIP Financing

Debtor-in-possession financing represents a specialized form of funding designed specifically for companies undergoing restructuring. What makes DIP financing particularly attractive is that it allows your existing management team to remain at the helm during the restructuring process. You retain control of your business while accessing the capital needed to stabilize operations, meet obligations, and implement your turnaround strategy.

A Strong Legal Foundation Supporting Your Success

Canada's legal framework for DIP financing was significantly enhanced in 2009, creating a robust and predictable environment for business restructuring. These reforms under section 11.2 of the CCAA provide clarity and confidence for both borrowers and lenders, making DIP financing a practical and accessible option for companies ready to take charge of their future.

Your Path Forward

Every successful restructuring begins with a single decision: the decision to take action and pursue available solutions. DIP financing empowers you to make that choice and provides the means to turn your turnaround plan into reality. Your business's next chapter can be its best chapter—and DIP financing can help you write it.

Learn More