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A Deed of Company Arrangement is a legally binding agreement between a struggling company and its creditors in India, offering a structured path to avoid liquidation. It's similar to a rescue plan that lets the business keep operating while working out its debt problems under the Insolvency and Bankruptcy Code, 2016.

During this process, an insolvency professional helps negotiate terms with creditors, setting up manageable payment schedules and possible debt restructuring. The arrangement must be approved by most creditors and can include strategies like selling assets, bringing in new management, or reorganizing operations to keep the business viable.

Consider a Deed of Company Arrangement when your business faces serious financial difficulties but still has potential for recovery. This option becomes crucial when your company can't pay its debts but has viable operations that could turn around with proper restructuring and creditor cooperation.

The arrangement works best when initiated early—before severe cash flow problems lead to complete insolvency. It's particularly valuable for medium to large companies with complex creditor relationships, multiple business units, or significant employee obligations. Under India's IBC framework, this path helps preserve business value while protecting both creditor interests and jobs.

• Basic Restructuring DOCA: Focuses on debt repayment schedules and basic operational changes, commonly used by small to medium businesses
• Asset Sale DOCA: Includes provisions for selling specific company assets to generate funds while maintaining core operations
• Management Change DOCA: Incorporates leadership transitions and new operational strategies alongside debt restructuring
• Creditor-Specific DOCA: Tailored for companies with specialized creditor groups like secured lenders or trade creditors
• Holding DOCA: Temporary arrangement that maintains business operations while developing a more comprehensive restructuring plan

• Company Directors: Initiate and oversee the arrangement process, remaining accountable for business operations during restructuring
• Insolvency Professional: Administers the Deed of Company Arrangement, mediates between parties, and ensures compliance with IBC regulations
• Creditors: Vote on and become bound by the arrangement terms, including banks, suppliers, and other financial stakeholders
• Legal Counsel: Drafts the deed, ensures legal compliance, and advises on terms and implementation
• Employees: Often affected parties whose rights and obligations are addressed in the arrangement

• Financial Assessment: Gather detailed company financials, debt schedules, and cash flow projections to understand restructuring needs
• Creditor Details: Compile complete list of creditors, their claims, security interests, and potential voting rights
• Business Plan: Develop realistic turnaround strategy showing how the company will meet arrangement obligations
• Asset Valuation: Document current market value of company assets and potential recovery scenarios
• Stakeholder Input: Collect feedback from key creditors and document proposed terms before finalizing the arrangement

• Company Details: Full legal name, registration number, registered office address, and director information
• Arrangement Terms: Clear payment schedules, debt restructuring details, and operational changes
• Creditor Rights: Voting mechanisms, claim priorities, and distribution arrangements
• Administrator Powers: Scope of authority, duties, and decision-making procedures
• Implementation Timeline: Key milestones, reporting requirements, and completion criteria
• Termination Provisions: Conditions for ending the arrangement and consequences of default

A Deed of Company Arrangement differs significantly from an Intercompany Agreement in both purpose and application. While both documents deal with business relationships, they serve distinct functions in corporate governance.

• Purpose and Timing: A DOCA is used during financial distress as a rescue mechanism, while Intercompany Agreements govern ongoing relationships between affiliated companies during normal operations
• Parties Involved: DOCAs involve external creditors and an insolvency professional, whereas Intercompany Agreements typically only involve related group companies
• Legal Framework: DOCAs operate under India's Insolvency and Bankruptcy Code with court oversight, while Intercompany Agreements function under standard contract law
• Duration and Flexibility: DOCAs are typically temporary arrangements aimed at business recovery, while Intercompany Agreements are long-term operational frameworks that can be amended as needed