Scheme of arrangement, Business Law and Ethics

Scheme of Arrangement:

The following sequence of action is necessary:

 (a) application is made to the court (usually by the company itself) for an order that one or more meetings of members and/or of creditors (if the scheme will affect the rights of creditors (if the scheme will affect the rights of creditors) shall be held.  With the application the company submits a document setting out in detail the terms of the scheme of arrangement and also an explanatory statement to be issued with the notice(s) convening the meeting(s).  If the court is satisfied that the scheme is generally suitable for consideration as a "scheme of arrangement" under s.207 it will order that a meeting of meetings be held to consider it.  The court is not at this stage concerned with the details of the scheme nor with the issue (which may arise later) as to whether there are conflicts of interest which require that separate meetings should be held.  The court merely looks at the outline of the scheme and if it seems suitable orders that meeting(s) be held;

 (b) a meeting or several meetings is or are held as the court has ordered.  A substantial quorum, say members (present in person or by proxy) holding one-third of the shares, is required and the scheme must be approved by members (or, as the case may be, creditors) voting at each meeting who-

(i) are a majority in number, and

(ii) represent three-quarters in value of the shares (or at a creditors' meeting, of the amounts owing).

Requirement (ii) is imposed to safeguard a minority in numbers who have a larger financial stake than the numerical majority: Re NFU Development Trust.

Posted Date: 1/15/2013 3:16:49 AM | Location : United States







Related Discussions:- Scheme of arrangement, Assignment Help, Ask Question on Scheme of arrangement, Get Answer, Expert's Help, Scheme of arrangement Discussions

Write discussion on Scheme of arrangement
Your posts are moderated
Related Questions
UNWRITTEN SOURCES OF ENGLAND LAW: However common law may be illustrated as that branch of the law of England that was developed through the English courts on the basis of the

I have a contract for employment, its is for a CTO position, giving me equity stake in the company, I do not agree with the offer and I have a counter offer, I need a experts opini

Avoidance of Floating Charges: Under s.314 liquidation automatically renders void any floating charge created within the period of 12 months before commencement of liquidation

Relate the military and economic power with each other The balance of military and economic power of equilibrium is therefore desirable. A balance of power is a pre-requisite f

Purchase Of Own Shares: Another possible way in which a company's paid-up capital may leave the company other than in the ordinary course of the company's business would be if

Advocates Whether in sec 3(1) of the Interpretation and General Provisions Act cap 2 and sec 2 of the Advocates Act (1989) an advocate is a person that whose name has been dul

In 2004 the Corporations and Markets Advisory Committee proposed that assets and liabilities of companies be aggregated and creditors paid from a common pool which is commonly refe

State the royal assent for the procedure of parliamentary. The Royal Assent: It is specified when the Bill has passes by both Houses successfully and is usually simply fo

Determine about the Principal-agent theories Wwhich concentrate especially on the problems of asymmetric information among the parties to a contract: the impossibility to perfe

QUESTION The Employment Rights Act provides- No employer shall terminate a worker's agreement for reasons related to the worker's misconduct unless the worker has been affor