Before 1st October 2021, French law did not provide for the possibility to cram down shareholders, other than under Article L. 631-19-2 of the French Commercial Code, which sets conditions which are so stringent that it is not used in practice.
Directive 2019/2023 has let EU member states decide whether shareholders should be a class of “affected parties” subject to cross-class cram down or whether other measures should be implemented to avoid shareholders preventing, or making it difficult, in an unreasonable manner, the approval of a restructuring plan.
A hotly anticipated decision in the ongoing saga of the Babcock & Brown liquidation was handed down last week, resulting in another win for the liquidator (represented by Johnson Winter & Slattery) and further highlighting the challenges facing liquidators when they are thrust into a quasi-judicial function when assessing proofs of debt.
Should a claim for appraisal rights brought by a former shareholder of a Chapter 11 debtor be subordinated under Section 510(b) of the Bankruptcy Code? According to the Bankruptcy Court for the District of Delaware, the answer is yes. See In re: RTI Holding Co., LLC, No. 20-12456, 2021 WL 3409802 (Bankr. D. Del. Aug. 4, 2021).
Background
Slotine explains the nuts and bolts of the two routes towards closing down a solvent company in Hong Kong: members’ voluntary winding-up and deregistration.
This article debunks the myths surrounding court-sanctioned winding-up in Hong Kong and lays out the process clearly, so you know what to expect.
The term “winding-up” refers to the sale of a company’s assets to settle its debts and distribute the surplus (if any) to its shareholders. Once this process is complete, the company is dissolved.
The Bottom Line:
IN RE: GOLF 255, INC. (July 22, 2011)
As COVID-19 related economic disruptions place unprecedented stress on cash flows, the risk of insolvency is a new and growing concern for many businesses. Against the backdrop of a decades-long growth in corporate debt, boards of directors are making decisions that have the potential for pitting the interests of creditors against the interests of equity shareholders.
What is a debt restructuring?
The aim of any restructuring (also sometimes called a workout) is to rearrange the debtor’s financial commitments so that it is able to service its restructured debts and survive as a going concern. It is important to note that this is a consensual process and is not undertaken under the supervision of a court or other supervisory body - therefore, it is important the all creditors are involved.
If it’s voluntary, how does it work?
In a decision of the Federal Court handed down on 18 October 2019 in Masters v Lombe (Liquidator); In the Matter of Babcock & Brown Limited (In Liquidation) [2019] FCA 1720, Foster J held that Babcock & Brown Limited (BBL) did not breach the continuous disclosure obligations in the Corporations Act 2001 and the ASX Listing Rules.