Section 7: Section 7: Administrator's Proposals
Article 39 - Statement of proposals(1) Where an
Administratorhas been appointed, he shall, within two months (or such longer period as the QFC Courtmay allow) after the commencement of the administration (being the date on which an Administratoris first appointed to the Company):(A) send to the CROand (so far as he is aware of their addresses) to all creditors a statement of his proposals for achieving the purpose or purposes of the administration; and(B) lay a copy of the statement before a meeting of the Company'screditors summoned, for the purpose, on not less than 14 days' notice.(2) Article 39(1)(B) shall not apply where the Administratorwas appointed by a Secured Creditorunder Article 20.(3) The Administratorshall also, within two months (or such longer period as the QFC Authoritymay allow) after his appointment, send a copy of the statement (so far as he is aware of their addresses) to all members of the Company.
Article 40 - Consideration of proposals by creditors' meeting(1) A meeting of creditors summoned under Article 39 shall decide whether to approve the
Administrator'sproposals.(2) The meeting may approve the proposals with modifications, but shall not do so unless the Administratorconsents to each modification.(3) Subject as above, the meeting shall be conducted in accordance with Article 41.(4) As soon as reasonable practical after the conclusion of the meeting, the Administratorshall report the result of the meeting to the QFC Courtand shall give notice of that result to the CRO.(5) If a report is given to the QFC Courtunder Article 40(4) that the meeting has declined to approve the Administrator'sproposals (with or without modifications), the QFC Courtmay:(A) provide that the appointment of the Administratorwill cease to have effect from a specified time;(B) where the Administratoris appointed pursuant to an Administration Order, discharge or vary such order and make such consequential provision as it thinks fit;(C) adjourn the hearing conditionally or unconditionally;(D) make an interim order; or(E) make any other order that it thinks fit, including approving a proposal for winding up the Companywhich had been suspended pursuant to Article 27(1).(6) Where the administration is discharged, the Administratorshall, within 14 days after the making of the order effecting the discharge, send a copy of that order to the CRO.
Article 41 - Meeting to consider Administrator's proposals(1) Notice of the creditors' meeting to be summoned under Article 39 shall be given to all the creditors of the
Company:(A) who are identified in the statement of affairs, or are known to the Administrator;(B) who had claims against the Companyat the date of the Administration Order; and(C) of whose address the Administratoris aware.(2) Notice of the meeting shall also (unless the QFC Courtotherwise directs) be given by advertisement in the newspaper or newspapers in which the appointment of an Administratorwas advertised.(3) Notice to attend the meeting shall be sent out at the same time to the QFC Authorityand any directors or officers of the Company(including persons who have been directors or officers in the past) whose presence at the meeting is, in the Administrator'sopinion, required.(4) If at the meeting there is not the requisite majority for approval of the Administrator'sproposals (with modifications, if any), the chairman may, and shall if a resolution is passed to that effect, adjourn the meeting for not more than 14 days.
Article 42 - Approval of substantial revisions(1) This section applies where:(A) proposals have been approved (with or without modifications) under Article 40; and(B) the
Administratorproposes to make revisions of those proposals which appear to him substantial.(2) The Administratorshall:(A) send to all creditors of the Company(so far as he is aware of their addresses) a statement in the prescribed form of his proposed revisions; and(B) lay a copy of the statement before a meeting of the Company'screditors summoned, for the purpose, on not less than 14 days' noticeand he shall not make the proposed revisions unless they are approved by the meeting.(3) The Administratorshall also send a copy of the statement (so far as he is aware of their addresses) to all members of the Company.(4) The meeting of creditors may approve the proposed revisions with modifications, but shall not do so unless the Administratorconsents to each modification.(5) Subject as above, the meeting shall be conducted in accordance with Article 41.(6) After the conclusion of the meeting, the Administratorshall give notice of the result of the meeting to the CRO.
Article 43 - Creditors' Committee(1) Where a meeting of creditors summoned under Article 39 has approved the
Administrator'sproposals (with or without modifications), the meeting may, if it thinks fit, establish a Creditors´ Committeeto exercise the functions conferred on it by these Regulations.(2) If such a Committee is established, the Committee may assist the Administratorand pass on to him the views of creditors, to which the Administratormust give reasonable consideration.
Article 44 - Protection of interests of creditors and members(1) At any time when a
Companyis in administration, the QFC Authority, a creditor or a member of the Companymay apply to the QFC Courtby application for an order under this Article on the ground:(A) that the Company'saffairs, business and property are being or have been managed by the Administratorin a manner which is unfairly prejudicial to the interests of its creditors or members generally, or of some part of its creditors or members (including at least himself); or(B) that any actual or proposed act or omission of the Administratoris or would be so prejudicial.(2) Subject to the Administrator'sduty to the Secured Creditorunder Article 20(2), Article 44(1) shall not apply when the Administratorhas been appointed by a Secured Creditorunder Article 20.(3) On an application for an order under this section the QFC Courtmay, subject as follows, make such order as it thinks fit for giving relief in respect of the matters complained of, or adjourn the hearing conditionally or unconditionally, or make an interim order or any other order that it thinks fit.(4) An order under this Article 44 shall not prejudice or prevent:(A) the implementation of an Arrangementapproved under Section 8 of this Part; or(5) Subject as above, an order under this Article 44 may in particular:(A) regulate the future management by the Administratorof the Company'saffairs, business and property;(B) require the Administratorto refrain from doing or continuing an act complained of by the applicant, or to do an act which the applicant has complained he has omitted to do;(C) require the summoning of a meeting of creditors or members for the purpose of considering such matters as the QFC Courtmay direct; and(D) discharge the Administration Orderand make such consequential provision as the QFC Courtthinks fit.
Article 45 - Statement to be annexed to proposals
There shall be annexed to the
Administrator'sproposals, when sent to the CROunder Article 39 and laid before the creditors' meeting to be summoned under that Article, a statement by him showing:(1) details relating to his appointment as Administrator, the purposes of the administration, and any subsequent variation of these purposes;(2) the names of the directors and secretary of the Company;(3) an account of the circumstances giving rise to the administration;(4) if a statement of affairs has been submitted, a copy or summary of it, with the Administrator'scomments, if any;(5) if no statement of affairs has been submitted, details of the financial position of the Companyat the latest practicable date (which must, unless the QFC Courtotherwise orders, be a date not earlier than that of the start of the administration);(6) the manner in which the affairs and business of the Company:(A) have, since the date of the Administrator'sappointment, been managed and financed; and(B) will, if the Administrator'sproposals are approved, continue to be managed and financed; and(7) such other information (if any) as the Administratorthinks necessary to enable creditors to decide whether or not to vote for the adoption of the proposals.
Article 46 - Reports and notices under Articles 40 and 42
Any report or notice by the
Administratorof the result of a creditors' meeting held under Articles 40 or 42 shall have annexed to it details of the proposals which were considered by the meeting and of the revisions and modifications to the proposals which were so considered and include a summary of the matters discussed at the meeting.
Article 47 - Notice to creditors(1) Within 14 days of the conclusion of a meeting of creditors to consider the
Administrator'sproposals or revised proposals, the Administratorshall send notice of the result of the meeting (including, where appropriate, details of the proposals as approved) to every creditor who received notice of the meeting and to any other creditor of whom the Administratorhas since become aware.(2) Within 14 days of the end of every period of six months beginning with the date of approval of the Administrator'sproposals or revised proposals, the Administratorshall send to all creditors of the Companya report on the progress of the administration.(3) On vacating office the Administratorshall send to creditors a report on the administration up to that time. This does not apply where the administration is immediately followed by the Companygoing into Liquidation, nor when the Administratoris removed from office by the QFC Courtor ceases to be qualified as an insolvency practitioner.
Article 48 - Duration and extension of administration(1) An
Administratoris authorised to act for the period of two years from the date of his appointment. He may extend the period of administration beyond that period only in accordance with this Article.(2) On the application of an Administratorthe QFC Courtmay by order extend his term of office for a specified period.(3) An Administrator'sterm of office may be extended for a specified period not exceeding twelve months by consent.(4) An order of the QFC Courtunder Article 48(2):(A) may be made in respect of an Administratorwhose term of office has al been extended by order or by consent; and(B) may be made after the expiry of the period referred to in Article 48(1) or of any subsequent extension.(5) Where an order is made under Article 48(2) the Administratorshall as soon as reasonably practicable notify the CRO.(6) In Article 48(3), in relation to an Administratorappointed under Article 8 or Article 23, "consent" means consent of:(A) each Secured Creditorof the Company; and(B) if the Companyhas unsecured debts, creditors whose debts amount to more than 50% of the Company'sunsecured debts, disregarding debts of any creditor who does not respond to an invitation to give or withhold consent.(7) In Article 48(3), in relation to an Administratorappointed under Article 20, "consent" means consent of the Secured Creditor.(8) An Administrator'sterm of office may be extended by consent more than once.(9) Where an Administrator'sterm of office is extended by consent he shall as soon as is reasonably practicable:(A) file notice of the extension with the QFC Court;(B) notify the CRO; and(C) notify the QFC Authority.(10) Where an Administratorfails to extend his term of office in accordance with this Article, the administration shall continue in force but the Administratoris liable to a fine.
Article 49 - Moving from administration to creditors' voluntary Liquidation(1) This Article 49 applies where the
Administratorof a Companythinks:(A) that the total amount which each Secured Creditorof the Companyis likely to receive has been paid to him or set aside for him; and(B) that a distribution will be made to unsecured creditors of the Company(if there are any).(2) The Administratormay summon a meeting of the Company'screditors at which a Resolution For Voluntary Winding Upshall be proposed.(3) On the passing of a resolution at the meeting summoned under Article 49 (2):(A) the appointment of an Administratorin respect of the Companyshall cease to have effect;(B) any Administration Orderin force shall be discharged; and(C) the Companyshall be wound up as if a Resolution For Voluntary Winding Upunder Article 58 had been passed.(4) The Administratorshall send to the CROa notice that this Article has been complied with.(5) When an Administratorsends a notice under Article 49 (4) he shall as soon as is reasonably practicable:(A) file a copy of the notice with the QFC Court; and(B) send a copy of the notice to each creditor of whose claim and address he is aware.(6) The Liquidatorfor the purposes of the winding up shall be:(A) a person nominated by the creditors of the Companyin accordance with Article 65; or(B) if no person is nominated under Article 49 (6)(A), the Administrator.(7) In relation to a winding up pursuant to this Article 49 :(A) Article 63 does not apply; and(B) any Creditors' Committeewhich is in existence immediately before the Companyceases to be in administration shall continue in existence after that time as if appointed as a Liquidation Committee.
Article 50 - Moving from administration to dissolution(1) If the
Administratorof a Companythinks that the Companyhas no further assets capable of realisation and no property which might permit a distribution to its creditors, and further that the dissolution of the Companywill not be adverse to the interests of creditors, then he shall send a notice to that effect to the CRO.(2) On the delivery to the CROof a notice in respect of a Companyunder Article 50(1) the appointment of an Administratorof the Companyshall cease to have effect, and any Administration Orderin force shall be discharged.(3) If an Administratorsends a notice under Article 50(1) he shall as soon as is reasonably practicable:(A) file a copy of the notice with the QFC Court; and(B) send a copy of the notice to each creditor of whose claim and address he is aware.(4) At the end of the period of three months beginning with the date of delivery to the CROof a notice in respect of a Companyunder Article 50(1) the Companyis deemed to be dissolved.(5) The QFC Courtmay, on the application of any person who appears to the QFC Courtto be interested, make an order deferring the date at which the dissolution of the Companyis to take effect for such time as the QFC Courtthinks fit.