Examinership

Protection of the court is obtained to assist the survival of a company, otherwise known as Examinership.
It allows a company to restructure, if approval of the High Court has been made.

In most circumstances the creditor’s ballences are reduced, whilst intangible assets of the company are protected, investment is sought and obtained, directors retain control.

This is an option for an insolvent company that allows it to explore all plans for survival.

An obvious advantage of examinership for a company is the avoidance of numerous risks for the company, in particular:

• A receiver cannot be appointed by the company’s debenture holder while under the protection of the Court

• A petition cannot be presented to the High Court to have an official liquidator appointed

• No goods may be seized or claimed by any creditor through the Sheriff, no goods held under a lease or a hire purchase agreement may be repossessed by the leasing company and no goods the subject of retention of title can be repossessed without the consent of the examiner

• No other proceedings may be commenced against the company without the consent of the Court

• Personal guarantees cannot be enforced during the examinership process. In certain circumstances, a personal guarantee may not be valid following the approval of the High Court of the examiner’s proposals for a scheme of arrangement.