A composition agreement was approved involving the merger of some of group’s companies and with different alternatives, one of which is specifically designed for financial institutions, but open to all creditors, proposing a partial capitalization of the insolvency credits and the payment of the resulting credits through the realization of certain assets and the free cash flow generated by the company in the coming eight years.

The fumus boni iuris used to justify the adoption of interim measures, involving blocking the enforcement of a financial guarantee, was counteracted since the pledge was fully enforceable under Luxembourg law, which was the governing law.

The parties had agreed to institute a financial guarantee on certain shares owned by the insolvent company and the pledge was made subject to Luxembourg law, because the account where the shares were deposited was located in Luxembourg.

PROCEDURE INTERNATIONALE D’INSOLVABILITE

SEUL LE TRIBUNAL QUI OUVRE LA PROCEDURE PRINCIPALE A L’ENCONTRE D’UNE PERSONNE MORALE EST COMPETENT POUR PRONONCER UNE INTERDICTION DE GERER CONTRE LE DIRIGEANT DE CELLE-CI (CASS.COM. 22 JANVIER 2013 N°11-17.968 (N°55 F-PB), MAJOT C/ STE BECHERET- THIERRY-SENECHAL- GORRIAS ES. QUAL.)

Comsa: debt restructuring PSA Financial Services Spain: establishing an asset-backed securities fund Emesa: subscribing a collar equity swap Proposal for an EU Directive on restructuring and second chance Exit right due to no dividend distribution: end of the suspension of art.

Rescission of an extension to a mortgage granted by the insolvent company securing a preexisting debt of a company of its group

Madrid Commercial Court No. 6 order of October 7, 2013: acquirer of a production unit subrogated in employment liabilities because the shareholders and directors had established the company specifically to acquire the insolvent company ("Marco Aldany Case")

The court did not rule out liability for employment obligations because the partners - directors of the insolvent company wished to acquire the production unit through a company created specifically to acquire it.

The Supreme Court clarified the insolvency categorisation for interest rate swap contracts, classifying them as insolvency credits, as they fail to meet the functional synallagma requirement, which establishes functional reciprocal obligations.

I CORPORATE FINANCE, COVENANTS AND CREDITOR’S LIABILITY 2 II NATIONAL LEGISLATION 4 III EUROPEAN LEGISLATION 5 IV NATIONAL CASE LAW 5 NEWSLETTER I CORPORATE LAW WWW.CUATRECASAS.COM NEWSLETTER I CORPORATE LAW 2/6 CORPORATE LAW NEWSLETTER I CORPORATE FINANCE, COVENANTS AND CREDITOR’S LIABILITY Introduction In the field of corporate finance the liability of creditors that negotiate covenants with companies is an issue that currently generates great concern.

The lender’s credit in respect of the joint-and-several guarantor declared insolvent is contingent unless existence of p

Assignment of a credit with recourse transfers ownership of the credit to the assignee when the transfer is approved and allows the assignee to request that it is separated from the assignor’s insolvency assets.

In both rulings, the Supreme Court stated the effects of assignment of a credit with recourse on the assignor’s declaration of insolvency.