If a company becomes insolvent or experiences a liquidity
crunch, which necessitates a restructuring or resort to higher-risk
financing arrangements, the directors should consider whether to
commence formal proceedings to facilitate the restructuring or
financing.
Where the directors believe the company is still viable, the
company may seek to implement a management-led restructuring by
taking advantage of Bermuda's court-supervised provisional
liquidation, commonly known as a "light touch"
provisional liquidation, which gives the company the benefit of a
statutory moratorium prohibiting the commencement or continuance of
any proceedings against the company without the leave of the
Supreme Court of Bermuda.
