Most Canaccord Capital Inc. clients holding frozen asset-backed commercial paper will now get their money back, all of it, the Vancouver-based firm announced today.

The company introduced the Canaccord Relief Program today, its plan to repurchase, at par value, up to $138 million of restructured ABCP notes from its clients.

The arrangement applies only to clients who hold $1 million or less of the currently frozen paper, which accounts for about 1,430 people, or 97%, of the firm’s clients invested in the problematic notes.

Rumours have been floating recently within the investor community about Canaccord’s plans to make a deal with individual investors. Mark Maybank, the firm’s COO blamed the lack of a tangible restructuring plan and extreme market volatility for the delay. This process “took much longer than anyone would have wanted it to,” he told analysts during a conference call this afternoon.

The committee charged with ironing out the mess, led by Bay Street lawyer Purdy Crawford, solidified a plan in March and subsequently received court-approved bankruptcy protection on the notes while it awaits approval from noteholders. When the plan was released, many individual investors began to question it and revisit their options.

Some hired lawyers, other voiced their concerns—and frustrations—at investors meetings hosted by Crawford and his committee. Every noteholder, regardless of the size of their holdings, gets one vote on the plan. This gives smaller, individual investors some power to knock down the plan.

Canaccord was one of the major sellers of the ABCP and today’s buyout plan likely increases the chances of Crawford’s plan passing. The relief arrangement announced today is completely dependent on the successful completion of the restructuring plan put forth. Maybank said he expects the deal to close as soon as possible after the restructuring of the notes takes place.

The ABCP committee welcomed the relief program. “We believe this is an important step in resolving the concerns of smaller noteholders,” said Crawford, in a statement this afternoon. “The Committee encourages other financial intermediaries who may have sold affected ABCP to small investors to follow Canaccord’s initiative and address the concerns of their smaller clients by providing liquidity solutions such as this one.”

According to the company, the arrangement combines a market bid from third-party sources with a Canaccord-funded top-up. The company would not provide the name of the buyer for the notes, but reports have suggested it might be Caisse de dépôt et placement du Québec, as it is a large holder of the paper and would therefore face substantial losses should the restructuring plan be voted down.

On top of the at par buyout, Canaccord said clients will receive any unpaid interest to the extent that it is available under the restructuring plan and Canaccord will reimburse the eligible clients’ actual share of the restructuring costs. All funds required for these repurchases will be deposited in escrow as soon as possible, it said.

With 97% of Canaccord’s ABCP investors taken care of, 3% are still left holding the paper. Maybank told analysts these clients will all be eligible for a loan facility against the class A restructured notes they will receive. Also, any non-corporate clients invested over $1 million will receive “some form of a top-up,” which Maybank said will equal that given to the eligible noteholders. He said the details are still in progress.

Maybank said the firm is currently facing one lawsuit, valued at $3.2 million dollars, from one of the clients not eligible for the buyback.

Canaccord said it is taking a one-time, after-tax hit of $39.6 million, or 82¢ per share, centred mainly on the relief program. This charge also includes a provision for management restructuring and other costs, it said.

“This is a significant charge to our earnings that reflects our commitment to resolving a very difficult process in the best possible way for our clients,” said Paul Reynolds, the firm’s president and CEO, in a statement. “We remain well capitalized and committed to our clients, which we believe we’ve demonstrated throughout this process.”

Canaccord also announced today that executive vp and head of private client services, Bob Larose has resigned and Bill Whalen, executive vp and head of the fixed income group is retiring from the company.

“These are unprecedented times that we believe call for some unprecedented measures,” said Maybank, of the relief program.