Examinership is a procedure unique to Ireland that was introduced in 1990 in order to help companies that are suffering financial difficulties to survive and stay in business while recovering from insolvency. Examinership gives the company an opportunity restructure and rebuild and is a good alternative to winding up the business or ceasing to trade.
Under Examinership once the company have appointed an Examiner they are under the protection of the High Court. When the Examiner is appointed they will “examine” the company exploring all the opportunities for the company to survive and work out a plan to help the company stay in business and recover from their financial difficulties.
In order for your Company to be suitable for Examinership, the High Court must be convinced that it has a reasonable chance of survival.
Petition for appointment of examiner
Examinsership begins with a Petition for the appointment of an Examiner being presented to the High Court. This can be presented by the following:
The petition nominates an individual to be appointed as Examiner of the company. As soon as the petition is presented to the court the company is under court protection for a period of 70 days which can be extended by another 30 days. In this time creditors are prevented from taking any sort of action against the company, such as trying to get the company wound up or appointing a receiver. The petition itself must outline the company’s details and prospects such as:
Once the Examiner is appointed their job is to examine the company’s affairs and formulate proposals for a scheme of arrangement as soon as possible after their appointment. Once the proposals are in place the Examiner must call meetings to present the proposals to the company’s shareholders and creditors and they will also report back the proposals to the Court.
At the meetings the examiner will present their proposals and answer any questions in relation to the scheme of arrangement. Changes to the scheme can be proposed at these meetings but they will only be made with the consent of the Examiner. The Examiners proposals are then put to a vote and a majority vote will determine if the proposals are to be carried forward or not. The Examiner will report to the High Court the outcomes of any such meetings between the members ad the creditors.
Once the Examiner presents his proposals to the creditors, they must vote on the scheme of arrangement. If the creditors agree to the scheme of arrangement proposed by the Examiner, the High Court then must approve the scheme. The court may not accept the proposal if the company has been trying to avoid tax, or if they thought the proposals were unfair to any of the parties involved.
In the event that the Examinership does not get approved the company involved will be placed into Liquidation. In this situation a Receiver may be appointed to the company.
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McCambridge Duffy Limited is a Limited Company registered in Ireland
Registered number 527584
Registered office 31-33 Lower Main Street, Letterkenny, County Donegal