A pre-pack insolvency sale, which is an expedited liquidation proceeding that allow for the sale of all or part of a debtor’s business as a going concern to the best bidder shortly after the insolvency proceedings are opened, is not formally regulated in the Czech Republic.
The success of the recently introduced pre-pack-like rules in Hungary will help determined how the EU Directive on pre-pack sales will be implemented in this country.
Existing pre-pack-like rules
When debt restructuring discussions are at an impasse and the reservoir of goodwill between the parties has run dry, stakeholders face difficult choices. For a lender, one of the most powerful tools available is the exercise of rights under a voting proxy given by a parent holding company in connection with a pledge of a borrower’s stock or membership interests. Through the exercise of proxy rights, lenders may replace a borrower’s board of directors with a new board made up of independent directors.
A “pre-pack” is a sale of all or part of a distressed company’s business or assets, negotiated before the company enters a formal insolvency process and executed by the appointed insolvency practitioner immediately after the insolvency process begins.
As we have written here on multiple occasions, the Private Attorneys General Act (PAGA) disadvantages employers in several ways. Despite permitting recovery similar to what might be obtained in a class action, class certification rules do not apply and it is an open question whether courts can even limit an unmanageable claim before trial.
Crypto firm bankruptcies and resulting disruption in the crypto ecosystem will continue to exacerbate liquidity and regulatory concerns in this space. Signs of contagion are evident as prices of almost every cryptocurrency type have halved in recent months. Since all participants supporting the crypto ecosystem are at risk, managing that risk is critical.
Fund managers should be prepared on multiple fronts, as the following examples illustrate:
Everything, everywhere, all at once is our risk thesis for 2023, but one must not forget about concentration risk. This issue has rocketed up diligence agendas for LPs and GPs alike as the collapse of Silicon Valley Bank proved it really was the bank for venture capital.The entry of SVB into receivership on March 10, 2023 highlighted just how central it had become to U.S.
Emergency legislation has introduced important changes to Hungarian insolvency laws that allow the debtor’s business to keep trading during insolvency.
The new rules apply to those debtors who are considered strategically important to the Hungarian economy and to those whose insolvency is declared under other emergency rules.
Demand for virtual currency services, including custody services, has soared in the past several years. Like their counterparts in traditional finance, these custodians are stewards of retail and institutional customer funds and serve an important and valuable function. However, as evidenced by a number of headline-grabbing failures during the lingering crypto winter, inadequate disclosures and poor custodial practices can seriously harm retail and institutional customers alike.