Schemes of Arrangement in Corporate Restructuring

Schemes of Arrangement in Corporate Restructuring : Law and Practice:• Provides a thorough introduction to the history and use of Schemes in the context of delivering debt restructures. Continues with an analysis of modern-day use discussing cross-border and jurisdictional issues•Examines the origin, purpose and advantages of the scheme by reference to highly practical material precedents and case studies (from inception to completion)•Explains the different type of scheme available including ‘pre-pack’ schemes, assessing their comparative advantages/disadvantages/key features and material descriptions with key case studies•Explores the fundamental legal principles including issues of ‘timing’ and ‘compromise’ by reference to a number of case studies•Addresses the notion of creditors in the context of schemes•Provides a ‘three-stage’ guide to Scheme from first court-hearing through to the ‘sanction hearing’ with an in-depth, practical emphasis on a number of UK, US and European case studies compiled form first-hand experience•Explores recognition issues in the context of multi-national schemes by reference to UK legislation, European Treaty Law and various International Trade Laws/regimes and how to get the scheme recognised•Looks at the involvement of COMI in the recognition process•Examines bondholder issues with a number of helpful precedents.•Looks at various pervasive issues with Schemes including competition, pensions, regulation, accounting, confidentiality and voidabiliy.•Provides a comparative analysis with other procedures including CVAs and Administrations. CONTENTSIntroduction -Importance-Use (jurisdictional discussion)History & Development-History-Purpose-Advantages to using schemes-Different types of schemes (descriptions/key features/advantages/disadvantages)Fundamental principles / key considerations and process-Companies Act 26 requirements-Timing-Compromise or ‘arrangement’-Creditor’s role-Secured creditors-No moratorium whilst the proposal is being put forward-Key Stages-First court hearing-Scheme creditor’s meeting-Sanction / fairness hearing-Orders that court can make under s.9-Court order / lodging with the registrar-Supervisor-CostsRecognition issues-Importance-Fall outside the EC Regulations and rationale-Interaction between the Insolvency Regulation and the Judgments Regulation-Non-EC jurisdictions-EC jurisdictions-COMI will assist recognition-Overseas processesThird party releases-Importance in complex, cross-border situations-Contracts-Compromise/release of rights against third parties through the scheme / Deeds of ReleaseBondholder issues- / diagram of how notes are usually held-Roles of trustee, depositary, clearing system etc-Numerosity issues, including contingent creditor analysis (vs definitisation): Marconi, Telewest, Schefenecker, Wind Hellas U.S issues-Recognition-US Securities Act-Third party releasesInsurance SchemesPervasive issues-Director’s duties-Tax-Contractual counter-parties outside the scheme-Competition-Regulatory-Accounting-Confidentiality and commercially sensitive terms-Voidability of new securityComparison with other procedures-Administration -CVAsDocumentation (Precedent Material)-Pre-scheme•Standstill agreement•Lock up / voting agreement•Confidentiality agreement•Term sheet•Commitment Letter-Practice statement letter-Prior to directions hearing•Finalise explanatory statement, scheme of arrangement and all appendices-Directions hearing•Appropriate board meetings / resolutions•Subject to Practice Direction 49B.•CPR Part 8 Claim Form oDetails of what covered, requirements etc.oSet out (or appendicise) the form.oDirections sought – provide full details of what can be sought etc.•Cross-refer to Practice Statement [22]•Explanatory statement and all appendices•Supporting evidence (witness statements etc), particularly in relation to class composition (cf Practice Statement)•Advertisements (include details (and possibly examples))•Skeleton argument (prepared by Counsel)•Court Order•Proxies (description about how used, can be complex (particularly if bonds are traded through clearing systems and reps need to be made, bonds blocked etc))•If an overseas company, opinion of relevant expert Re: the effectiveness of the scheme overseas-Creditor’s meeting•Agenda•Registration sheet•Chairman’s script•Voting tabulation-Sanction hearing•Application for sanction is made by an amended Part 8 Claim Form (New Practice Direction to CPR 49). Provide details.•Second Witness Statement of Director of Company•Company’s skeleton argument (prepared by counsel)•Report of Chairman•Sanction Order-Lodging the court sanction with Companies HouseCase studies -Landmark schemes:•Marconi•Telewest•My Travel •British Energy•Queens Moat Houses•Drax•Crest Nicholson •McCarthy & Stone •Countrywide •IMO Car Wash •La Seda •Gallery Media •Wind Hellas •European Directories •Tele Columbus / Orion Cable •Rodenstock•Cattles plc