Companies Act 2014 section 539

Proposals for compromise or scheme of arrangement

Section 539 sets out the detailed requirements for what must be included in an examiner's proposals for a compromise or scheme of arrangement, including the identification of affected classes, the treatment of their claims or interests, and the supporting financial information that must accompany the proposals.

• The examiner must identify each class of members and creditors, specify which classes will or will not be impaired, and ensure equal treatment within each class unless a holder agrees to less favourable terms — with secured and unsecured creditors always treated as separate classes.
• The proposals must set out the restructuring measures, their duration, arrangements for informing and consulting employees, employment consequences, and any new financing needed with reasons for its necessity.
• A statement of assets and liabilities, a description of the company's economic situation and the causes of its difficulties, and an estimated financial outcome of a winding up must be attached to the proposals for each class of members and creditors.
• A creditor's claim is impaired if they receive less than the full amount owed at the date the examinership petition was presented, and a member's interest is impaired if the nominal value, dividend entitlement, rights, or percentage ownership of their shares is reduced or removed.