Formal Restructuring & Insolvency (Cayman)

Insolvent Liquidations

When a fund or company is insolvent, key stakeholders seek our appointment as liquidators. Interpath create a respectful partnership with stakeholders, to maximise the realisation of assets, and ensure a legally fair distribution. We understand the risks and likely issues and realise the importance of creating the right balance while maintaining control.

Restructuring Officer

New reforms to the Companies Act have introduced a formal restructuring regime to the Cayman Islands. Akin to the US Ch. 11 and UK Administration business rescue proceedings, it can be used in its own right or to support proceedings in other jurisdictions.

The filing of a petition for the appointment of a Restructuring Officer (RO) gives a company the benefit of an automatic worldwide moratorium, to allow the company time to consider the best way to restructure its debts.

Although the powers and functions of the RO are set out in the Court order, the overarching role of an RO is to act as an independent, court appointed fiduciary to oversee the restructuring of a company. A RO will assist the Board with their negotiations with stakeholders and monitor the situation to ensure that restructuring remains viable.

Receiverships

Contractual and Equitable Receivers – In times of financial stress, secured lenders have a variety of options available to pursue outstanding monies owed from corporate entities. Receivership appointments are made by way of an order from the Court or under the terms of a contractual security document and can be an effective enforcement tool for a secured judgment creditor. 

Segregated Portfolio Companies (SPCs) – Pursuant to Section 224 of the Companies Act, a receiver can be appointed to facilitate, where necessary, the safeguarding, investigation and potential realisation of assets of the segregated portfolio(s). Interpath have experience of dealing with these unique corporate structures. A receivership over a segregated portfolio does not prevent the profitable areas of the business, i.e., the other segregated portfolios, from continuing to trade. 

Provisional Liquidation

In the Cayman Islands, Provisional Liquidation appointments can be used to support a restructuring and, also more traditionally, to safeguard the company and its shareholders against the misconduct of a company's principals or to prevent the dissipation of company assets ahead of a hearing of a petition to wind up the company. Oftentimes, subject to the appointment orders, a ‘traditional’ provisional liquidation appointment will include directions to investigate the transfer, assets or the conduct of the principals. Interpath have proven cross-jurisdiction experience in asset recovery and fraud investigation. 

Company Restoration

If a company has been struck off and dissolved, the most common reason for an application being made to restore the company to the register is that there are assets that need to be dealt with, or investigations that need to be undertaken.

Interpath regularly takes appointments to assist with the restoration of a company to the registers followed by a liquidation process.