Documentation in Corporate Restructuring

Course Overview

This course considers the documentation required in corporate restructurings including debt for equity swaps, schemes of arrangement to restructure debt and/or equity and a capital reduction to cancel share capital or eliminate a deficit on distributable reserves to enable payment of dividends out of future profits.

It includes the terms of different classes of shares, the form of shareholder and creditor consents and documentation for applications to court for approval of a scheme of arrangement and/or a reduction of capital.

Differences in the documentation for private companies and listed companies are also covered, including the new procedure for reductions of capital by private companies without going to court.

The implications for listed companies are explained, including documentation under the Listing Rules, Disclosure and Transparency Rules (and the AIM Rules for companies quoted on AIM) and the Prospectus Rules and Takeover Code, including a Rule 9 whitewash.

Course Content

Debt for equity swaps

• Cancelling or swapping debt for different classes of shares or one class of share for another (e.g. preference shares for ordinary shares).
• Consents for the variation of class rights under the Companies Acts 1985 and 2006.
• Creating new classes of shares, including redeemable, preference and convertible shares.
• Allotment authorities and pre-emption rights when issuing shares with different class rights or swapping debt for equity.
• Private companies:
  • shareholder resolutions
  • shareholders’ agreements
  • articles of association
• Listed companies:
  • circulars to shareholders
  • requirements under the Listing Rules and Disclosure and Transparency Rules (and AIM Rules for companies quoted on AIM)
• Prospectus Rules and whether a prospectus will be required.
• Implications under the Takeover Code and documents for a Rule 9 whitewash.
• What will change from 1 October 2009 as a result of full implementation of the Companies Act 2006.

Reductions of capital

• Documents required by public companies for applications to court for a reduction of capital to cancel share capital or eliminate a deficit on distributable reserves to enable payment of dividends out of future profits including:
  • circular to shareholders, notice of general meeting and class meetings and shareholder resolutions
  • court documents including application notice, witness statements, order for directions, advertisement of the court hearing undertakings to the court and the court order approving the reduction
  • requirements of the Listing Rules and Disclosure and Transparency Rules
• Documents required by private companies for a reduction of capital to cancel share capital or eliminate a deficit on distributable reserves to enable payment of dividends out of future profits:
• Applications to court for a reduction of capital including:
  • shareholder resolutions and consents
  • court documents including witness statements, undertakings and court order
• The new procedure under the Companies Act 2006 for a reduction of capital without going to court including:
  • shareholder resolutions and consents
  • directors’ declaration of solvency
  • statement of capital

Schemes of arrangement

• Documentation for schemes of arrangement for a debt and/or equity restructuring including:
  • Claim form;
  • Convening Court meeting(s) of shareholders and/or creditors;
  • Witness statements supporting the claim form;
  • Scheme circular including:
    • scheme of arrangement
    • explanatory statement required by section 897 Companies Act 2006
    • notice of meetings, including a general meeting
    • form(s) of proxy
  • Chairman’s report of Court meetings and witness statement by Chairman of meetings verifying report as to result of meetings
  • Order sanctioning scheme
• Listed companies:
  • Circulars to shareholders
  • Requirements under the Listing Rules and Disclosure and Transparency Rules (and AIM Rules for companies quoted on AIM)

Delivering this course in-house for you to a number of participants could be very cost effective. Please call us on 020 7387 4484 to discuss this further.

If you have any questions about this seminar please write to us at post@redcliffetraining.co.uk.