Op werkdagen voor 23:00 besteld, morgen in huis Gratis verzending vanaf €20

Distress Dynamics in Bankruptcy

Gebonden Engels 2015 9789462366299
Niet leverbaar.

Samenvatting

A change in the dynamics of bankruptcy procedures is taking place in the Netherlands and United States. In the Netherlands, the opening of a bankruptcy procedure traditionally leads to the sale of the assets of the debtor and a distribution of the proceeds among creditors. In recent years, however, there has been increased attention for reform of Dutch bankruptcy law as to enhance its reorganizational possibilities and enable the saving of viable businesses.

In the United States a trend in the opposite direction can be seen. Bankruptcy law of this country has traditionally been known for its reorganizational possibilities, but in recent years there has been a marked increase in asset sales and efforts have been undertaken to limit the abilities to rescue any businesses.

These changed dynamics warrant a fundamental discussion about bankruptcy law. Not every business in trouble should be liquidated, but not every business in trouble should be saved either. Rather, the challenge is to ensure that if a business enters bankruptcy, this bankruptcy leads to an efficient outcome by formulating the right rules. This book aims to formulate these rules.

Specificaties

ISBN13:9789462366299
Taal:Engels
Bindwijze:gebonden
Aantal pagina's:262
Uitgever:Eleven
Druk:1
Verschijningsdatum:25-11-2015
Hoofdrubriek:Juridisch
ISSN:

Lezersrecensies

Wees de eerste die een lezersrecensie schrijft!

Geef uw waardering

Zeer goed Goed Voldoende Matig Slecht

Inhoudsopgave

Glossary xi

1 Introduction 1
1 Introduction of the topic 1
2 Central subject of this book and limiation of scope 4
3 Overview of contents 5
4 Methodology 7

2 Efficient bankruptcy law in the U.S. and the Netherlands. Establishing an assessment framework 9
1 Bankruptcy procedure in the US 11
2 Bankruptcy procedure in the Netherlands 15
1 Why does bankruptcy law exist? 21
1.1 The common pool problem 21
1.2 The balance-sheet insolvent debtor 23
1.3 The cash-flow insolvent debtor 24
1.4 Commons and anticommons 25
2 The (hypothetical) creditors' bargain 26
3 The creditors' bargain theory and absolute priority 30
4 The creditors' bargain theory and the new value exception 33

3 Shaping bankruptcy. What form should it take? 69
1 Bankruptcy procedure in the U.S. 70
2 Bankruptcy procedure in the Netherlands 73
1 The administrative reorganization procedure 75
1.1 The administrative reorganization procedures 75
1.2 Costs of an administrative reorganization procedure 76
1.2.1 Valuation uncertainty 76
1.2.2 Direct costs 79
1.2.3 Speed 80
1.2.4 Perverse incentives for management 80
2 Ex ante capital structures 83
2.1 Chameleon Equity 84
2.1.1 The Chameleon Equity structure 84
2.1.2 The Chameleon Equity structure elaborated 85
2.2 Contingent Equity 86
2.3 The difference between Chameleon Equity and Contingent Equity 88
2.4 The costs of automatic restructuring 89
2.5 Bankruptcy as a default rule: a choice by menu 95
2.5.1 Bankruptcy as a term of contract 95
2.5.2 The bankruptcy menu 97
2.5.3 Selecting and changing options 99
2.6 Costs of the menu approach 101
2.7 The costs of contractualism 102
3 The auction-alternative 104
3.1 A mandatory auction regime 104
3.2 The costs of a mandatory auction regime 106
4 (Stock) market based approaches 108
4.1 Options theory 109
4.1.1 The options procedure 110
4.1.2 Possible complications 113
4.2 Options theory 2.0 114
4.3 The costs of the option approach 116
1 The advantage of the alternatives: correct valuation 119
2 The drawbacks of the alternatives 120
3 How high are the costs of an administrative reorganization procedure really? 121
3.1 Direct costs 121
3.2 Speed 123
3.3 Perverse incentives for management 124
3.4 The valuation problem: an evolution 125

4 An assessment of Dutch bankruptcy asset sales 129
1 Introduction 129
2 Guiding principles for trustee in asset sales? 132
3 The sale of assets under Dutch law: 101 DBC 134
3.1 The current assessment standard for asset sales 134
3.2 Maximizing value as a goal 135
3.2.1 The goal of bankruptcy in the Netherlands 135
3.2.2 The goal of bankruptcy in the Netherlands and the creditors' bargain theory 137
3.2.3 Maximizing value and Section 101 DBC 138
3.2.4 Maximizing value and Section 101 DBC: overbidding 139
4 Creditors with a right of summary execution and asset sales 142
4.1 The right of summary execution 142
4.2 Section 101 DBC and creditors with right of summary execution 143
4.2.1 Reasonable time limit of Section 58 DBC 146
4.2.2 Cooling-off period of Section 63a DBC 148
4.2.3 Abuse of power 150
4.3 Overriding the secured creditor 151
5 Method of sale 153
5.1 Statutory framework for the method of sale 153
5.2 Public auctions in the context of a summary execution 154
5.3 Public auctions and the creditors' bargain theory 156
5.4 Private sales and insiders 157
6 Conclusion 160

5 The sale process in a pre-packaged asset sale 161
1 Introduction 161
2 The problem of the ‘melting ice cube’ 162
2.1 Bankruptcy law as solution for a common pool problem 163
2.2 Blocking of individual recourse does not prevent value decrease 164
3 The pre-pack as solution 166
4 The risk of the pre-pack: faulty pricing 167
5 Information rights of trustee 169
5.1 Need for free access to complete books and records 169
5.2 Need for possibility of free access to third parties 170
6 Control of the sale process by the intended trustee 171
6.1 Risk that debtor continues for too long 171
6.2 Risk that debtor fails to approach potential buyers 172
6.2.1 Accountability obligations insufficient 173
6.2.2 Informal powers of intended trustee insufficient 173
6.2.3 The added value of a public sale process for pricing 175
6.2.3.1 The American 363-sale and the concept of the stalking horse 175
6.2.3.2 (Un)certainty for stalking horse: bid procedures 177
6.2.3.3 Dutch market too small for public sale process 179
6.2.3.4 Funding structure of companies impediment to stalking horse 179
6.2.4 Safeguarding the approach of potential buyers by the debtor: how to do it? 182
7 Conclusion 183

6 The Dutch reorganization plan. An assessment of the efficiency of the legal framework from the perspective of the creditors' bargain theory 185
1 Introduction 185
2 The creditors' bargain theory 186
3 The legal framework of the Dutch reorganization plan 189
3.1 Bringing about the reorganization plan 189
3.2 Confirmation of the reorganization plan 191
3.3 Dissolution of the reorganization plan 192
4 Assessing the legal framework in light of the creditors' bargain theory 192
4.1 Cramming down a reorganization plan in light of the creditors' bargain theory 192
4.2 Binding creditors with a right of preference in light of the creditors' bargain theory 195
4.3 Confirmation of the reorganization plan in light of the creditors' bargain theory 198
5 Conclusion 202

7 The cram down plan outside of bankruptcy: CEA 2 and conflicts of interest assessed 205
1 Introduction 205
2 The CEA 2: bankruptcy law or not? 206
2.1 Why a collective recourse method I: common pool 207
2.2 Why a collective recourse method II: anticommons 208
3 The added value of the CEA 2 209
4 The cram down plan outside of bankruptcy: bankruptcy or not? 211
4.1 The twilight period before the cram down plan is adopted and CEA 2 212
4.1.1 Individual recourse possible under CEA 2 212
4.1.2 Possibility of suspending handling of bankruptcy filing under CEA 2 213
4.1.3 European Commission does recommend general moratorium 213
4.2 The twilight period before the cram down plan is adopted and the creditors' bargain theory 214
4.2.1 Common pool problem = imposing collective recourse 214
4.2.2 The (lack of a) common pool problem during the twilight period after a cram down plan is offered 215
5 The ‘lock-in’ of creditors and its exceptions 217
5.1 First relativization: payment of new creditors 218
5.2 Second relativization: essential suppliers 218
5.3 Third relativization: selection of creditors and shareholders who are impaired 218
6 The position of shareholders under a cram down plan 220
6.1 Shareholders and CEA 2 220
6.2 Shareholders and the creditors' bargain theory 221
7 Conclusion 222

8 Summarizing conclusion 225
1 Introduction 225
2 Determining ‘efficiency’: upgraded creditors' bargain theory 225
2.1 The creditors' bargain theory as explanation for bankruptcy law 225
2.2 Criticism on creditors' bargain theory is not convincing 226
2.3 The goal of bankruptcy under the creditors' bargain theory shows resemblance with Dutch bankruptcy law, but is not the same 227
2.4 The upgrade: anticommons as justification for reorganizational law 227
3 The efficiency of bankruptcy law regarding asset sales 228
3.1 Introduce a possibility to override creditors with a right of summary execution 228
3.2 Method of sale in asset sale 229
3.2.1 Public auctions: ensure value maximization by modernizing 229
3.2.2 Private sales: introduce a duty of care for insiders 230
3.3 Method of sale in a pre-packaged asset sale: increased risk of faulty pricing 231
3.4 Guaranteeing integrity of sale process: information rights and steering of sale process 231
3.4.1 Steering the sale process I: intended trustee should be able to file for bankruptcy 232
3.4.2 Steering the sale process II: stalking horse may be useful to ensure enough potential buyers 232
3.5 Guaranteeing integrity of sale process: intended trustee should not be held hostage by debtor 233
4 The efficiency of bankruptcy law regarding reorganizations 233
4.1 The structure of reorganizations: reorganization plan to be preferred 233
4.2 The law regarding reorganizations: reform necessary 234
4.2.1 Reorganization plan: binding all creditors and improving confirmation criteria 235
4.2.2 The cram down plan outside of bankruptcy: introduce possibility of a collective stay 235
4.2.3 Reorganization plans: further measures regarding shareholders necessary 236
5 Overall conclusion 237

Index to case law 239
Index to literature 245

Managementboek Top 100

Rubrieken

Populaire producten

    Personen

      Trefwoorden

        Distress Dynamics in Bankruptcy