The Cayman Islands restructuring officer (RO) regime will come into force this week. This regime will allow debtors to file in the Cayman Islands court to request the appointment of an RO, and obtain an immediate stay on unsecured creditor action, without the need to file a winding up petition. For a brief overview of the key features of the RO regime please read on or watch the short video below.
What are some of its key features? Here are 9 of them
- A RO appointment is possible for a company that is, or is likely to be, unable to pay its debts and intends to present a compromise or arrangement to creditors.
- Compromise or arrangement can be pursuant to the Cayman Companies Act, a foreign law or by way of a consensual restructuring
- A RO petition can be filed by directors without shareholder approval and without express power.
- No need to file winding-up petition alongside RO petition
- RO will only have those powers and functions conferred on the RO by the Court order
- There is an automatic stay of creditor actions and passing of shareholder winding-up resolutions from filing of RO petition
- Stay has extra-territorial effect as a matter of Cayman Islands law
- Secured creditors can continue enforcement of security despite RO appointment
- A compromise or arrangement can be promoted within the RO proceedings.