In recent months certain restructuring processes have gained quite some notoriety in press headlines in connection with a number of UK businesses. This article provides secured lenders with a brief recap on the key points to note in relation to CVAs (Company Voluntary Arrangements) and what Liquidation means in the context of Carillion.
Retail CVAs
Recent Developments in Acquisition Finance
Introduction
Judge James M. Peck of the Bankruptcy Court for the Southern District of New York held, on June 25, 2013 (the “Lehman Op.”),1that claims under repurchase transactions (“Repos”) do not qualify as customer claims and therefore are not entitled to the priority or coverage provided for customers’ claims under the Securities Investor Protection Act (“SIPA”).
There are essentially three types of insolvency proceeding: liquidation, receivership and administration. Liquidators realise and distribute a company’s assets before dissolving the company. Receivers usually realise certain secured assets to repay certain debts, before appointing a liquidator. However, an administrator’s first objective is to rescue the company as a going concern. It is only if this is not practicable that the administrator can realise and distribute a company’s assets.
The High Court has struck down a company voluntary arrangement on the ground that it unfairly prejudiced a landlord who was to lose the benefit of a guarantee given by the tenant’s parent company. The judge said it was “unreasonable and unfair in principle” to require the landlord to give up the guarantee and there was “no sufficient justification” for requiring the landlord to accept a sum of money in lieu.
Title II of the Dodd-Frank Act establishes a new non-judicial receivership al-ternative for resolving troubled financial companies that could threaten the stability of the U.S. financial system (“Covered Financial Companies”), as described further below. The Federal Deposit Insurance Corporation (“FDIC”), on October 12, 2010, issued a notice of proposed rulemaking (the “Proposal”) to begin to implement the provisions of Title II.
The United States Court of Appeals for the Fifth Circuit on March 17, 2010 held that foreign representatives appointed in a foreign insolvency proceed-ing have the authority to bring a foreign law based avoidance action in an ancillary bankruptcy proceeding commenced under Chapter 15 of the Bankruptcy Code, reversing the lower court opinions.
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:
- The sale of productive units of a company subject to insolvency proceedings has become common practice in the Commercial Courts, especially those of Catalonia, which have the express support of the Directorate General for Industry of the Regional Government of Catalonia.
This procedural solution allows companies to continue as a going concern, ensuring the maintenance of jobs and avoiding the destruction of the business landscape.
La Resolución de la Dirección General de los Registros y del Notariado (RDGRN) de 19 de diciembre de 2018 (BOE 28 de enero) se pronuncia de nuevo sobre la extinción registral de sociedades sin patrimonio. En esta ocasión se admite la inscripción de una escritura de disolución y liquidación de una sociedad de responsabilidad limitada en la que el liquidador declaró que la sociedad carecía de activos y de acreedores, de conformidad con el balance aprobado unánimemente por los socios.