- Creditors are frozen by the Section 1A Company Voluntary Arrangement
- CVA - Responsibility of directors in a Section 1A CVA
- Section 1A Insolvency Act 1986 - Disclosure Requirements
- Creditors not included in the CVA proposal
- What does a Nominee of a Company Voluntary Arrangement have to do?
- CVA Creditors Meeting - Section 1A Insolvency Act 1986
- Voting Rights in a CVA under Section 1A Insolvency Act 1986
- Supervisors Duties in a Section 1A CVA
- A draft Company Voluntary Arrangement Proposal for you to look at
- Costs of preparing and operating under a Company Voluntary Arrangement
- Concluding the Company Voluntary Arrangement - The end is nigh!
- Banks and other secured creditors in a Company Voluntary Arrangement
- Landlords no longer protected from a Company Voluntary Arrangement
- Petitioning Creditors
- Company Voluntary Arrangements and Preferential Creditors - Definition
- Benefits to unsecured Creditors in the newer type of CVA
What happens at a Company Voluntary Arrangement Creditors Meeting?
Rules applying under Section 1A Insolvency Act 1986
Creditors can attend at the Company Voluntary Arrangement creditors meeting to consider and vote on the proposal document in person or by giving their "proxy" to another person to vote in the way that they wish at the creditors meeting.
The creditors meeting has to take place within 28 days of the company voluntary arrangement proposal being first filed into court.
It is possible for the creditors to extend the period of the moratorium obtained by the issue of a Company Voluntary Arrangement proposal under Section 1A by up to two months. To obtain such an extension a resolution must be passed which is approved by a majority of three quarters in value of those creditors present personally or by proxy and voting at the company voluntary arrangement creditors meeting.
The creditors might ultimately approve the proposal with or without any modifications or might reject that which has been proposed.
If the Company Voluntary Arrangement proposal is rejected at the creditors meeting make sure that your Licenced Insolvency Practitioners have previously discussed with you a "Plan B".
There are two separate votes at the creditors meeting at which the creditors decide to approve, modify or reject the proposed Company Voluntary Arrangement.
- On the first vote all unsecured creditors including connected creditors (such as relatives, business partners etc) can vote. For this resolution to be approved 75% in value, of those voting must be in favour.
- Assuming that first hurdle is jumped there is a second vote. On the second vote connected creditors are not allowed to participate. For this second resolution to be approved 50% in value of those unconnected creditors then voting must be in favour.
The parties who can participate in any vote to adjourn the creditors meeting to a later date are, however, quite different. For such a resolution secured creditors can vote for the full amount they are owed (in other words the value of their security is ignored)
Have your LIcenced Insolvency Practitioners given you a Plan A and a Plan B so that you can walk into a Company Voluntary Arrangement creditors meeting with confidence?
