Thematic Review on Out-of-Court Corporate Debt Workouts: Peer Review Report

Where eligibility requirements to access the OCW frameworks apply, they mainly relate (often on the basis of a restructuring and/or payment plan) to: the duration of business activity; the assessment that the debtor is solvent; the overall amount of debt of the company; the amount of liquid assets or receivables; the absence of previous or ongoing restructuring agreements; lack of criminal history. [...] Provided that all creditors involved in the agreement have been notified about the beginning of the negotiations, if 75% of financial creditors pertaining to a specific class agree to the moratoria and an independent professional certifies that dissenting financial creditors pertain to the same class as the agreeing ones and that dissenting creditors suffer prejudice proportionate to the debtor re. [...] That standard sets forth requirements for expert opinions on the feasibility of restructurings, covering, inter alia, the analysis of the debtor’s economic, financial, and legal situation and the evaluation of the measures envisaged for the purpose of resolving the debtor’s distress. [...] Box 6: Hybrid procedures in the US In the US, a pre-packaged bankruptcy is a bankruptcy case that begins with the filing of a plan of reorganization with the bankruptcy court that has already been accepted by creditors (or as to which solicitation of acceptances is already underway as of the date of the initiation of the bankruptcy case). [...] Administrative costs are reduced by removing the automatic appointment of a creditors committee unless ordered by the court for cause, by only permitting the debtor to file a plan of reorganization, eliminating the ability of creditors or the trustee to file a competing plan, and by eliminating the debtor’s requirement to file a disclosure statement.