In UK venture deals, investors often negotiate the right to appoint a director to the company’s board (as a rule of thumb, an investor with 5% to 10% or more of the company might ask for board rights). On paper, it makes sense, giving a seat at the table, direct access to management, and visibility on key decisions. But before taking that seat, we often advise investors to ask themselves: is it worth the hassle?
The retail and hospitality sector in Australia remains relatively steady in terms of financial performance. However, retailers, including those in hospitality, continue to be faced with some persistent headwinds and difficult trading conditions. In our three (3) part series, we cover some of the challenges facing Australian businesses in the sector, including those exposed to external administrations, the strategies that are working via administration, and how early intervention and turnaround strategies can help preserve long term enterprise value for stakeholders.
Section 182 of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32) (“CWUMPO”) renders the disposition of a company’s property after the presentation of a winding-up petition against it void, subject to any validation order granted by the court. This provision serves to preserve the company’s assets at the date of the winding-up petition for the general benefit of creditors, and to ensure that the statutory scheme of pari passu distribution can be implemented.
Introduction
Before the landmark decision of the Hong Kong Court of Final Appeal in Guy Kwok-Hung Lam v Tor Asia Credit Master Fund LP [2023] HKCFA 9 (“ReGuy Lam”), there had been a long-standing debate over the impact, if any, of an exclusive jurisdiction clause in favour of a foreign court (“EJC”) on the presentation of bankruptcy / winding-up petitions.
As practitioners we pour over notices of intention to appoint (NOIA) and notices of appointment of administrators (NOA) to make sure every detail is accurate. Why? Because no one wants to risk an invalid appointment because there was a minor mistake or error that was overlooked. Understandably errors occur, particularly when the appointment of administrators often happens at speed, with all parties inevitably juggling many balls. Prescribed information may have been missed, or incorrectly stated and procedural steps may have been inadvertently forgotten.
The bankruptcy court presiding over the FTX Trading bankruptcy last month issued a memorandum opinion addressing valuation of cryptocurrency-based claims and how to “calculate a reasonable discount to be applied to the Petition Date market price” for certain cryptocurrency tokens.
For those that are that way inclined (which includes us at #SPBRestructuring!), the 500 plus page Wright v Chappell judgment which sets out the BHS wrongful trading claim against its former directors makes for an interesting read. It paints a colourful picture of the downfall of the BHS group, from the point that it was sold for £1 to its eventual demise into administration and then liquidation. You can make your own mind up about the characters involved, but the story is a sorry one, with creditors ultimately suffering the most.
File your proof of claim before the bar date. That’s a principle every creditor in a bankruptcy case should adhere by. But on June 7, 2024, the United States Bankruptcy Court for the Southern District of New York may have increased the degree of diligence parties need to conduct to determine whether they are a potential creditor in a case and therefore required to file a proof of claim.
On June 27, 2024, the Supreme Court ruled in a 5-4 decision that a bankruptcy court does not have the statutory authority to discharge creditors’ claims against a non-debtor without the creditors’ consent (except in asbestos cases). The decision in Harrington v.
No, it isn’t. We now have two cases where the Court has confirmed that insolvency practitioners do not need the consent of paid secured creditors when extending an administration under para. 78 of Schedule B1 of the Insolvency Act 1986 (the “Act”).