One of the more effective risk-mitigation legal tools used by senior real estate lenders is the single purpose entity borrower. Among other things, having a single purpose, bankruptcy remote borrower makes avoiding the risks of bankruptcy easier. Even in bankruptcy, if the borrower is truly single purpose, and it keeps the universe of creditors small, the senior secured lender will have an easier time defeating any plan of reorganization proposed by the borrower because it will control all of the legitimate classes of creditors by virtue of th
The Portuguese Official Journal (Diário da República) published last 30 May Act no. 32/2014, approving the new pre-enforcement out-of-court procedure.
The above referred procedure will come into force on 1st September 2014 and will be available to creditors with enforceable instruments that may be relied on in summary enforcement proceedings (judgments, orders for payment and extrajudicial instruments regarding overdue pecuniary obligations).
According to its Explanatory Notes, RD Act (Order in Council) 4/2014, of 7 March, adopting urgent measures on business debt refinancing and restructuring, aims to facilitate the financial repair and recovery of companies facing an economic crisis. To this end, a set of rules varying in scope and significance have been laid down, which I here discuss with regards to the treatment reserved to loans granted under refinancing agreements - as provided by the Spanish Insolvency Act (IA) - and their signatory creditors.
This paper sets out to make some considerations on the position of creditors holding real security (security in rem) within para-insolvency and insolvency refinancing procedures introduced or modified by Royal Decree Act (Order in Council) 4/2012 adopting urgent measures on business debt refinancing and restructuring. I will avoid the new scope of the avoidance of preinsolvency transactions under arts. 71 bis and 72 of the Spanish Insolvency Act (IA), which will be the subject of a subsequent paper. Nor will the calculation of the “value of (real) security” be discussed here.
In homologated refinancing agreements
El Real Decreto-ley 11/2013, de 2 de agosto, para la protección de los trabajadores a tiempo parcial y otras medidas urgentes en el orden económico y social, albergó diversas disposiciones de tipo so- cio-laboral, algunas de ellas referidas a reestructu- raciones laborales en empresas concursadas.
Approach
Approach
Art. 172 IA determines the pronouncements the at-fault classification ruling must contain, judicial pronouncements that constitute true civil penalties.1
Thus, after classifying the insolvency proceedings as at-fault, the people affected by the classification and the accomplices, on whom the orders will fall, have to be determined. Then, arts. 172 and 172 bis IA establish that the judgment must order:
This paper is essentially a commentary on the changes introduced by Royal Decree Act (Order in Council) 4/2014 in respect of applications for clawback (avoidance) orders against or within refinancing agreements.
- Non-homologated qualified majority refinancing agreements
Arbitrary differences