Footwear and Tanning Industries Assistance Regulations (C.R.C., c. 970)

Short Title

1 These Regulations may be cited as the Footwear and Tanning Industries Assistance Regulations.

Interpretation

2 In these Regulations,

Board

Board means the General Adjustment Assistance Board established by section 3 of the General Adjustment Assistance Regulations; (Commission)

consulting assistance

consulting assistance means technical and professional services provided by a consultant acceptable to the Board, for the purpose of developing and implementing plans for restructuring the operations of a manufacturer; (aide consultative)

Executive Committee

Executive Committee means the Executive Committee established by section 4; (comité de direction)

footwear

footwear means any form of footwear other than footwear the main component of which is canvas; (chaussure)

loan

loan means a loan made pursuant to section 6; (prêt)

manufacturer

manufacturer means

• (a) a person, firm or corporation or a division thereof in Canada engaged in a manufacturing or processing activity in the footwear or tanning industries, or both, on January 1, 1974,

• (b) any corporation restructuring by means of the acquisition of one or more corporations or divisions thereof referred to in paragraph (a), or

• (c) a corporation formed after January 1, 1974 by the merger or acquisition of two or more corporations or divisions thereof referred to in paragraph (a); (fabricant)

manufacturing or processing activity

manufacturing or processing activity means an activity whereby any footwear or leather

• (a) is made, fabricated, processed or refined out of any raw material or other substance, or of any combination thereof, and includes the tanning of any raw material or other substance or of any combination thereof, or

• (b) is made by causing any raw material or other substance to undergo a significant chemical, bio-chemical or physical change including any change that preserves or improves the keeping qualities of that raw material or other substance but excluding any change by growth or decay; (travaux de fabrication ou de traitement)

Minister

Minister means the Minister of Industry, Trade and Commerce; (ministre)

restructure

restructure means a change that, in the opinion of the Board, is significant in the operations of a manufacturer in respect of the products, methods of production, markets or management procedures of the manufacturer and, if directly related to any of those operations, includes

• (a) the acquisition, merger or amalgamation of one or more manufacturers described in paragraph (a) of the definition “manufacturer”,

• (b) the acquisition of working capital, or

• (c) the acquisition, construction or conversion of machinery, equipment, buildings, land or other facilities; (restructuration)

security

security means security for the repayment of a loan. (garantie)

Board

3 The Board shall administer the loans made under these Regulations and shall do all things that in its opinion are necessary or appropriate to minimize any loss suffered or likely to be suffered by Her Majesty arising out of any loan.

Executive Committee

4 There is hereby established a subcommittee of the Board to be known as the Executive Committee consisting of three members of the Board, one of whom shall be the Chairman or the Vice-Chairman of the Board, one of whom shall be the member of the Board designated by the Minister and one of whom shall be the member of the Board designated by the Minister of Finance.

Application for Loan

5 Every application for a loan shall be made to the Board or the Executive Committee and the applicant shall provide such information relating to the application as the Board or the Executive Committee may require.

Loans

• 6 (1) The Board may, on behalf of Her Majesty, make a loan or loans, not exceeding $1,500,000 in the aggregate, to a manufacturer for the purpose of assisting the manufacturer in restructuring.

• (2) Notwithstanding subsection (1), the Board may, on behalf of Her Majesty, make a loan or loans, exceeding $1,500,000 in the aggregate, to a manufacturer for the purpose of assisting the manufacturer in restructuring by means of acquisition, merger or amalgamation.

• (3) Where a loan has been made to a manufacturer, a further loan in any amount may be made by the Board, on behalf of Her Majesty, to that manufacturer for the purpose of protecting the interest of Her Majesty in the assets securing the loan previously made.

• (4) Where a loan has been made to a manufacturer and a trustee, receiver, receiver-manager or other person has been empowered to carry on the business of the manufacturer, a further loan in any amount may be made by the Board, on behalf of Her Majesty, to that trustee, receiver, receiver-manager or other person, as the case may be, for the purpose of protecting the interest of Her Majesty in the assets securing the loan previously made.

• (5) The Executive Committee may, on behalf of Her Majesty, make a loan or loans to a manufacturer

  • (a) not exceeding $150,000 in the aggregate for the purpose described in subsection (1); and

  • (b) not exceeding $250,000 in the aggregate for the purposes described in subsections (3) and (4).

• (6) The amount of any loan shall be paid by Her Majesty in whole or in part to the manufacturer or the trustee, receiver, receiver-manager or other person, as the case may be, upon the requisition of the Board or the Executive Committee.

• (7) No loan shall be made except to a manufacturer whom the Board or the Executive Committee has determined to be eligible for a loan.

Loan Agreement

• 7 (1) No loan shall be made unless the applicant enters into such agreements with Her Majesty as the Board or the Executive Committee considers necessary.

• (2) The Board or the Executive Committee with the consent of the applicant may amend the terms and conditions of any agreement entered into pursuant to subsection (1).

Rate of Interest

• 8 (1) The rate of interest for any loan shall be determined as of the day the application for the loan is approved by the Board or the Executive Committee and shall be within the prescribed range described in subsection (2).

• (2) The range of rates of interest for any loan shall be not less than the rate of interest charged by the Government of Canada to Crown corporations for loans of a similar term and not higher than 2 1/4 per cent above that rate.

• (3) Notwithstanding subsection (1), the highest rate of interest shall be applied normally to loans where restructuring is related only to the acquisition of working capital.

Term of Loan and Repayment

• 9 (1) Every loan shall be for such term, not exceeding 15 years, as may be fixed by the Board.

• (2) The whole or any part of a loan may, in such manner as may be prescribed by the Board, be repaid in advance of the due date of repayment without notice or bonus.

• (3) In the event of default on the part of a manufacturer, the Board or the Executive Committee may call any loan made to him.

Security

• 10 (1) Where, in the opinion of the Board, security for the repayment of a loan should be obtained, the Board shall obtain and hold such security as it considers proper.

• (2) The Board may surrender, retransfer or reconvey any security.

• (3) The Board or the Executive Committee may

  • (a) amend the provisions of any security; and

  • (b) designate any trustee, receiver, receiver-manager or other person required to be appointed by the Board under any security.

Analysis of Manufacturers’ Operations

• 11 (1) No loan shall be made to a manufacturer until the Board has obtained from the manufacturer plans for restructuring based on a comprehensive analysis of the operations of the manufacturer in respect of the products, methods of production, markets or management procedures of the manufacturer, which analysis shall be made by a consultant acceptable to the Board.

• (2) Where the manufacturer is able to establish to the satisfaction of the Board his capability of making the analysis described in subsection (1), the analysis may be made without the assistance of a consultant.