Xiang Is an Independent Financial Advisor

Xiang is an independent financial advisor. As a result of a few bad decisions, he has fallen on hard times. He is unable to meets his liabilities as they fall due. He believes, however, that he can avoid bankruptcy by persuading all of his creditors to agree to a proposal under which he would be given more time to pay his debts in exchange for his willingness to pay a higher rate of interest. Which of the following statements is TRUE?

A) The Bankruptcy and Insolvency Act does not say anything about Xiang's proposal.
B) If Xiang's proposal is rejected by his creditors, he automatically is placed into bankruptcy.
C) Xiang's proposal will succeed only if two thirds of his creditors accept it.
D) The proposed process must include all of Xiang's creditors, both secured and unsecured.
E) Xiang is entitled to make such a proposal only if he already is in bankruptcy.