Section 899 scheme meaning

The effect of a scheme of arrangement (scheme) At the sanction hearing, the court may make an order approving a scheme. Under section 899(3) of the Companies Act 2006 (CA 2006), a compromise or arrangement that the court has sanctioned is binding on: (a) all creditors or any class of creditors, or on the members or any class of members, as the case requires; and (b) the company, or, if the company is in the course of winding up, its liquidator and contributories. That position is, however, qualified by CA 2006, s 899(4), which provides that the court’s order does not take effect until a copy has been delivered to the Registrar of Companies (Companies House). It follows that the effective date of a scheme is the date on which a copy of the order is filed at Companies House (see Q&A: how to file documents—specifically an order approving a new Corporate Insolvency and Governance Act 2020 restructuring plan, see section 901F(6)(b) Companies Act 2006—at Companies House during the...

The voting requirement As set out in Practice Note: Schemes of arrangement—process and statutory framework, section 899(1) of the Companies Act 2006 provides that the court may sanction a scheme only where, at each scheme meeting, approval is obtained by: a majority in number (the numerosity test); and creditors representing 75% in value voting in person or by proxy. From 26 June 2020, if a scheme is proposed within 12 weeks of a moratorium under the Corporate Insolvency and Governance Act 2020, those owed moratorium debts and any pre‑moratorium debts for which the company did not benefit from a payment holiday during the moratorium effectively possess a veto, as the court may not sanction a scheme that makes provision in respect of such creditors without their consent (see Practice Note: Moratorium). For guidance on the methodology used to determine the correct composition of creditor classes, see Practice Note: Schemes of arrangement and restructuring plans—class issues...

IN THE HIGH COURT OF JUSTICE Business and Property Courts of England and Wales at [insert location], Insolvency and Companies List (ChD); or in the County Court at [insert location], Business and Property Courts List; or in the High Court of Justice, Chancery Division. Claim No: [No.] of [insert year] Claimant In the matter of [insert name of company] and in the matter of Part 26 of the Companies Act 2006 Defendant(s) Does this claim involve any issues under the Human Rights Act 1998? [Yes or No] Defendant’s name and address Details of claim (see also overleaf) A. The above company (the Applicant) seeks the following orders and directions: An order sanctioning a scheme of arrangement (the Scheme) under section 899(1) of the Companies Act 2006, provided the Scheme has been approved by the requisite creditor majorities; Upon such approval, that the application to sanction the Scheme be listed for hearing before a Judge of the Chancery...