GoodBox is no longer under administration after a decision from the High Court brought it to a close this month.
Since their appointment as joint Administrators in June 2022 Frost and Wadsted had pursued multiple avenues to try and save the brand’s future whilst protecting the charities, religious organisations and museums reliant on the company’s services for their donations, with more than £4.5mn of donations processed in the course of their appointment.
Now, as of 16 January 2023, the Court has sanctioned a Part 26a scheme for the company, a judgement that formally brings the administration to a close. The sanctioned plan will save the £4.5mn of taxpayer funds provided to GoodBox in January 2021 via the UK Government Future Fund, which launched to support innovative UK businesses during the pandemic and is operated by the British Business Bank on behalf of the Government. The Bank will retain equity in the company and a share of future revenue as intended.
A Part 26a (part of the Companies Act 2006) can be applied when two conditions are met by a company. The first is that it has encountered, or is likely to encounter, financial difficulties that are affecting, or will or may affect, its ability to carry on business as a going concern. The second is that an arrangement is agreed with its creditors or members to restructure its affairs to prevent, reduce or mitigate the effect of any of these difficulties.
The Part 26A Restructuring Plan was proposed by NGI Systems, a tech vendor of GoodBox’s, but voted against by the British Business Bank. However, more than 90% of the remaining shareholders’ and creditors’ votes were cast in favour of the plan, enabling it to be sanctioned by the court.
Tibor Barna, a founding partner at NGI Systems and co-founder of GoodBox, welcomed the decision of the court, commenting:
“We are pleased that the court has again ruled in our favour, confirming our belief that the rescue plan backed by 20 new investors is the best route forward for the company and its clients, under the control of the new independent board of directors.
“It was disappointing that the Future Fund, via its director Luis Martin, acted in a manner that represented neither the interest of the taxpayer nor the mission and mandate of the Future Fund, which was to support the companies they invested in to save them from collapse during COVID.”
GoodBox’s proposed restructuring includes independent scheme administrators, 18 angel investors and the appointment of a new, independent board of directors.
Jeremy Frost, Director of Frost Group Ltd, commented:
“We send our best wishes to the team at GoodBox Co and are hopeful that they can get back to being the essential part of the charitable industry that it once was. There is a plan now for a funded future, however, considerable uncertainty and many questions will need to be answered in the near future.
“It is very sad that these uncertainties, brought into sharp focus whilst acting as Administrator were not addressed in the scheme, a position so serious that it did not allow us to take anything other than a neutral stance.”
Note: this article was amended on 2 February to include the quote from Tibor Barna and further information on the Part 26A Restructuring Plan.
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