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  • Section 7: Section 7: Administrator's Proposals

    • Article 39 - Statement of proposals

      (1) Where an Administrator has been appointed, he shall, within two months (or such longer period as the QFC Court may allow) after the commencement of the administration (being the date on which an Administrator is first appointed to the Company):
      (A) send to the CRO and (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's creditors summoned, for the purpose, on not less than 14 days' notice.
      (2) Article 39(1)(B) shall not apply where the Administrator was appointed by a Secured Creditor under Article 20.
      (3) The Administrator shall also, within two months (or such longer period as the QFC Authority may 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's proposals.
      (2) The meeting may approve the proposals with modifications, but shall not do so unless the Administrator consents 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 Administrator shall report the result of the meeting to the QFC Court and shall give notice of that result to the CRO.
      (5) If a report is given to the QFC Court under Article 40(4) that the meeting has declined to approve the Administrator's proposals (with or without modifications), the QFC Court may:
      (A) provide that the appointment of the Administrator will cease to have effect from a specified time;
      (B) where the Administrator is 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 Company which had been suspended pursuant to Article 27(1).
      (6) Where the administration is discharged, the Administrator shall, 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 Company at the date of the Administration Order; and
      (C) of whose address the Administrator is aware.
      (2) Notice of the meeting shall also (unless the QFC Court otherwise directs) be given by advertisement in the newspaper or newspapers in which the appointment of an Administrator was advertised.
      (3) Notice to attend the meeting shall be sent out at the same time to the QFC Authority and 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's opinion, required.
      (4) If at the meeting there is not the requisite majority for approval of the Administrator's proposals (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 Administrator proposes to make revisions of those proposals which appear to him substantial.
      (2) The Administrator shall:
      (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's creditors summoned, for the purpose, on not less than 14 days' notice
      and he shall not make the proposed revisions unless they are approved by the meeting.
      (3) The Administrator shall 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 Administrator consents 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 Administrator shall 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's proposals (with or without modifications), the meeting may, if it thinks fit, establish a Creditors´ Committee to exercise the functions conferred on it by these Regulations.
      (2) If such a Committee is established, the Committee may assist the Administrator and pass on to him the views of creditors, to which the Administrator must give reasonable consideration.

    • Article 44 - Protection of interests of creditors and members

      (1) At any time when a Company is in administration, the QFC Authority, a creditor or a member of the Company may apply to the QFC Court by application for an order under this Article on the ground:
      (A) that the Company's affairs, business and property are being or have been managed by the Administrator in 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 Administrator is or would be so prejudicial.
      (2) Subject to the Administrator's duty to the Secured Creditor under Article 20(2), Article 44(1) shall not apply when the Administrator has been appointed by a Secured Creditor under Article 20.
      (3) On an application for an order under this section the QFC Court may, 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 Arrangement approved under Section 8 of this Part; or
      (B) where the application for the order was made more than 28 days after the approval of any proposals or revised proposals under Article 40 or 42, the implementation of those proposals or revised proposals.
      (5) Subject as above, an order under this Article 44 may in particular:
      (A) regulate the future management by the Administrator of the Company's affairs, business and property;
      (B) require the Administrator to 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 Court may direct; and
      (D) discharge the Administration Order and make such consequential provision as the QFC Court thinks fit.

    • Article 45 - Statement to be annexed to proposals

      There shall be annexed to the Administrator's proposals, when sent to the CRO under 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's comments, if any;
      (5) if no statement of affairs has been submitted, details of the financial position of the Company at the latest practicable date (which must, unless the QFC Court otherwise 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's appointment, been managed and financed; and
      (B) will, if the Administrator's proposals are approved, continue to be managed and financed; and
      (7) such other information (if any) as the Administrator thinks 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 Administrator of 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's proposals or revised proposals, the Administrator shall 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 Administrator has 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's proposals or revised proposals, the Administrator shall send to all creditors of the Company a report on the progress of the administration.
      (3) On vacating office the Administrator shall send to creditors a report on the administration up to that time. This does not apply where the administration is immediately followed by the Company going into Liquidation, nor when the Administrator is removed from office by the QFC Court or ceases to be qualified as an insolvency practitioner.

    • Article 48 - Duration and extension of administration

      (1) An Administrator is 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 Administrator the QFC Court may by order extend his term of office for a specified period.
      (3) An Administrator's term of office may be extended for a specified period not exceeding twelve months by consent.
      (4) An order of the QFC Court under Article 48(2):
      (A) may be made in respect of an Administrator whose 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 Administrator shall as soon as reasonably practicable notify the CRO.
      (6) In Article 48(3), in relation to an Administrator appointed under Article 8 or Article 23, "consent" means consent of:
      (A) each Secured Creditor of the Company; and
      (B) if the Company has unsecured debts, creditors whose debts amount to more than 50% of the Company's unsecured 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 Administrator appointed under Article 20, "consent" means consent of the Secured Creditor.
      (8) An Administrator's term of office may be extended by consent more than once.
      (9) Where an Administrator's term 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 Administrator fails to extend his term of office in accordance with this Article, the administration shall continue in force but the Administrator is liable to a fine.

    • Article 49 - Moving from administration to creditors' voluntary Liquidation

      (1) This Article 49 applies where the Administrator of a Company thinks:
      (A) that the total amount which each Secured Creditor of the Company is 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 Administrator may summon a meeting of the Company's creditors at which a Resolution For Voluntary Winding Up shall be proposed.
      (3) On the passing of a resolution at the meeting summoned under Article 49 (2):
      (A) the appointment of an Administrator in respect of the Company shall cease to have effect;
      (B) any Administration Order in force shall be discharged; and
      (C) the Company shall be wound up as if a Resolution For Voluntary Winding Up under Article 58 had been passed.
      (4) The Administrator shall send to the CRO a notice that this Article has been complied with.
      (5) When an Administrator sends 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 Liquidator for the purposes of the winding up shall be:
      (A) a person nominated by the creditors of the Company in 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' Committee which is in existence immediately before the Company ceases 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 Administrator of a Company thinks that the Company has no further assets capable of realisation and no property which might permit a distribution to its creditors, and further that the dissolution of the Company will 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 CRO of a notice in respect of a Company under Article 50(1) the appointment of an Administrator of the Company shall cease to have effect, and any Administration Order in force shall be discharged.
      (3) If an Administrator sends 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 CRO of a notice in respect of a Company under Article 50(1) the Company is deemed to be dissolved.
      (5) The QFC Court may, on the application of any person who appears to the QFC Court to be interested, make an order deferring the date at which the dissolution of the Company is to take effect for such time as the QFC Court thinks fit.