Although the Sunbird scheme of arrangement was approved by the relevant creditors, sanction was refused by Mr. Justice Snowdon, who highlighted:

• a ‘paucity of information provided by the company as part of the scheme process’, and
• a failure to engage with creditors ‘whom the directors clearly felt were irrelevant or would be an obstacle to their plans’.

He remarked that the company’s approach 'fell a considerable distance short of what was required for a fair process'.

Despite commentators’ recent focus on the new Part 26A restructuring plan, introduced in late June by the Corporate Insolvency and Governance Act 2020, the scheme of arrangement under Part 26 of the Companies Act 2006 (“scheme”) remains a popular tool for companies to reach a compromise or arrangement with their creditors and/or its members.

I. Introduction

Complex restructurings are no stranger to colorful facts and unpredictable twists and turns. But few lead to criminal charges. Fewer still involve criminal charges against the chairman of the unsecured creditors’ committee, alleging that he abused his position to benefit himself financially.

Financial Restructuring & Insolvency/Finance A New Restructuring Plan

16 SEPTEMBER 2020

IN THIS ISSUE:

Introduction Process for Implementing a Plan Availability of the Plan Disenfranchisement of Creditors or Members Numerosity Cross-class Cram Down Moratorium Veto Pensions Opinion

New Look's unsecured creditors today approved a company voluntary arrangement that will amend 402 store leases to a turnover rent model, reflecting recent movements in the market towards more flexible lease obligations.

Despite opposition from many landlords, and considerable disquiet in the property industry, it is clear that tenants remain open to using the CVA process to restructure their leases, as a means to address the impact of the COVID-19 pandemic.

Introduction

GOVERNANCE & SECURITIES LAW FOCUS

JULY 2020/LATIN AMERICA EDITION

Below is a summary of the main developments in U.S., EU, and U.K. corporate governance and securities law since our last update in May 2020.

See our page dedicated to the latest financial regulatory developments.

IN THIS ISSUE

GOVERNANCE & SECURITIES LAW FOCUS

JULY 2020/EUROPE EDITION

Below is a summary of the main developments in U.S., EU, U.K. and Italian corporate governance and securities law since our last update in April 2020.

See our page dedicated to the latest financial regulatory developments.

IN THIS ISSUE

Virgin Atlantic announced yesterday its plans for a recapitalisation, worth approximately £1.2 billion over the next 18 months. Support has already been secured from the majority of stakeholders.

However, to secure approval from all relevant creditors before implementation, Virgin Atlantic plans to use the new 'restructuring plan' as introduced by the Corporate Insolvency and Governance Act 2020 (CIGA), which came into force late last month.

UK CORPORATE INSOLVENCY AND GOVERNANCE ACT 2020

9 JULY 2020

IN THIS ISSUE:

Permanent Insolvency Changes A New Standalone Moratorium A New Restructuring Plan Ipso Facto Termination Clauses

Temporary Insolvency Changes Modification of Wrongful Trading Liability Statutory Demands Winding Up Petitions Winding Up Orders

Further Changes

Governance Changes Company Meetings Company Filings

Final Thoughts