A Corporation Is A Voluntary Agreement

A Corporation Is A Voluntary Agreement

It is similar to an individual voluntary agreement (IVA), but for companies. Like the very similar Company Voluntary Arrangement (CVA), a VPA is a legally binding agreement to repay debts to creditors through monthly contributions over a typical period of between three and five years. Depending on the circumstances of the business and the amount it can afford to repay each month, this could mean that only a portion of the total debt will be paid. The terms of a CVA proposal set the percentage of the debt repaid to creditors during the period of the company`s voluntary agreement. This strongly depends on the level of the company`s debt, which is weighed against its ability to repay based on current and/or future cash flow forecasts. The VPA also provides the partnership with protection against creditor lawsuits. .