Case Studies

CClad Construction Limited

CClad is a contracting business specialising in Cladding and operating from North West Business Park, Ballycoolin, Dublin 15.

The Company had traded since 1998 with directors who had considerable experience in the Cladding industry.

It traded at a profit until early 2009. In early 2011, the following issues became apparent and had the combined effect of leaving the Company unable to pay its debts as they fell due:

1. Arbitration proceedings on collection of outstanding monies;
2. Difficulties in collection of debts / bad debts experienced;
3. Lack of credit from suppliers;
4. Potentially uninsured personal injury claim.

Due to the above difficulties, in February 2011, the Company petitioned the High Court to have Neil Hughes appointed as examiner to the Company.

Over the course of the 100 day protection process, the incumbent directors provided the Company with new investment to facilitate a scheme with its creditors. The company emerged from examinership in May 2011 following negotiations with its retention of title creditors and after reaching unanimous agreement with the trade creditors to pay them a 5% dividend on their debts. The potentially uninsured personal injury claim was contained in the scheme of arrangement and subject to a 5% dividend on this debt, if the liability of the Company was proven.

The Revenue Commissioners were paid 10% in full and final settlement of arrears. The bank in this case agreed to continue to support the Company on an ongoing basis and the leasing creditors were restructured over a revised lease term of 60 months.

The scheme was approved by the High Court and CClad continues to trade with 18 jobs intact and all trade creditors and Revenue debt fully discharged through the scheme of arrangement.

Case Study: Jo’burger Limited

Jo’burger is a South African barbeque themed restaurant located on the Main Street in Rathmines in Dublin.

The company started trading in 2007 and proved to be immediately popular with its innovative menu comprising of a range of South African themed gourmet burgers, named after districts in Johannesburg. Having traded successfully at its Rathmines premises it went on to open a second restaurant at Main Street Blackrock. The restaurant won numerous awards including The Dubliner People’s Choice Restaurant of the Year 2008.

However, difficulties for the company became apparent in 2009 when it was clear that the Blackrock restaurant was not going to be successful. It was apparent that the location for the new restaurant had been ill-chosen and trade losses intensified.

Notwithstanding the success of the Rathmines restaurant and the awards received, the company became insolvent and entered examinership in September 2009. Neil Hughes of Hughes Blake was appointed examiner and the Blackrock restaurant closed.

Over the course of the 100 day protection process, new investment was secured for the company. The company emerged from examinership in December 2009 following negotiations with the landlord and after reaching unanimous agreement with the trade creditors to pay them a 10% dividend on their debts. The Revenue Commissioners were paid 20% in full and final settlement of arrears.

The scheme was approved by the High Court and Jo’burger began 2010 with 15 jobs intact and all historic creditors fully discharged through the scheme of arrangement.

“We are more than happy to be discussed as a case study to support the advantages of examinership. It is an enlightened piece of legislation, which few people understand. Thanks again for everything.”

Investor and new Managing Director, Jo’burger Limited.

Case Study: Hotel in County Wicklow

This Company was involved in the operation of hotel, night club and bar in County Wicklow.
The Company’s business commenced in 1984 and the hotel traded profitably for a number of years
However, the following difficulties for the company became apparent at the end of 2009:

1. Difficulties in the Hotel Sector as a whole, including over supply of hotel rooms as a result of tax incentives in the sector.

2. Management issues.

3. Significant contingent liabilities as a result of third party claims against the Company.

The company became insolvent and entered examinership in February 2010. Neil Hughes of Hughes Blake was appointed examiner to the company.

Over the course of the 100 day protection process, new investment was secured for the company from the existing directors. The Company reduced its costs, secured a tax clearance certificate and returned to profitability.

The company emerged from examinership in May 2010 after reaching agreement with its creditors to pay them a 10% dividend on their debts. The Revenue Commissioners were paid 20% in full and final settlement of arrears.
The scheme was approved by the High Court and the company exited the process with 45 jobs intact and all historic creditors fully discharged through the scheme of arrangement.