What happens after a watershed meeting depends on whether your creditors vote to return the company to you, place your company in liquidation, or enter into a deed of company arrangement (DOCA).
If your company is returned to you
If your company is returned to you, the administration ends and, if appropriate, we update your status on the Companies Register from 'In voluntary administration' to 'Registered'.
If your company is placed in liquidation
If your company is placed into liquidation, the administration of the company ends and we update your status on the Companies Register from 'In Voluntary administration' to 'In liquidation'.
Your company is placed into liquidation according to the provisions set out in the Companies Act 1993.
If your company enters into a DOCA
A Deed of Company Arrangement (DOCA) is an agreement that aims to save your company and minimise the losses of creditors.
The company, its creditors, directors, officers, shareholders and the deed administrator are bound by the terms of the deed, which includes a list of all claims against your company at the date it's put in place.
Everyone who votes in favour of the deed at the watershed meeting must agree:
- to the terms in the deed, which can include forgiving some of the company's debts, and
- not to take any further action against the company.
The company agrees to use the words ‘subject to deed of company arrangement’ after its name.
The role of the deed administrator
The deed administrator must prepare a document that sets out the proposed terms of the DOCA. The deed administrator can be the same person acting as the administrator. A deed administrator must be a licensed insolvency practitioner.
If the deed is not agreed to within the specified time period, the administrator must publicly advertise that fact, advise us, and apply to have a liquidator appointed.
Once the deed is agreed, the deed administrator must:
- send written notice to each creditor
- advertise in at least 1 newspaper in circulation in the area where the business is located, and
- file a copy of the deed with us.
Control of your company after administration
If a DOCA is executed, your powers as director will depend on the terms of the deed.
When the deed is terminated, you regain control of your company, unless the deed provides for the company to go into liquidation. The deed can be terminated by the court, your creditors, or when circumstances specified in the deed have occurred.
If creditors resolve that the administration should end, you regain control of the company and are responsible for ensuring that the company pays its outstanding debts as they fall due.