Court Approved Restructuring Plan

A restructuring plan is a Court-approved agreement between a company and its creditors to restructure its debt often allowing it to pay back some, or all of it, over a period of time.

In order for it to be passed it requires 75% of each class of creditor and shareholders to agree to it.

However if one or more classes of creditor votes against it all is not lost. If the Court deem the proposal to be of general benefit to the majority of creditors without the dissenting classes of creditors being worse off than under a relevant alternative, it can approve the agreement regardless of the dissenting creditors.

This is unlike a Company Voluntary Arrangement (‘CVA’) where all classes of creditors must vote in favour by 75% or more for it to be approved.

Putting together a restructuring plan requires a large amount of financial and legal due diligence. The procedure requires two court hearings, the first to approve the classes of creditors voting and the second to approve the arrangement.

For more information and detail regarding your circumstances please speak with one of the BRI management team here.

Contact us if you would like further information and assistance regarding any aspect of a restructuring plan for your company. There is no charge for doing so and it is without obligation.

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