When a company with outstanding debts suddenly begins restructuring, what can a creditor expect, and what actions should they take?
The first idea that often comes to a creditor’s mind is to “block” the restructuring process and return to the state before it began. However, in most cases, this is impossible. Furthermore, if the creditor hasn’t received payment before restructuring, it is unlikely they will receive it after blocking the process.
– “Blocking a restructuring initiated by the debtor doesn’t make sense. One of the primary goals of restructuring is to satisfy creditors and propose repayment terms that are feasible for the debtor and acceptable to the creditor,” explains Przemysław Furmanek from the law firm Lege Restrukturyzacje.
Good Communication with the Supervisor
When restructuring proceedings are initiated, the creditor will receive a notification outlining the procedure and the supervisor’s contact details. It’s essential to keep this information to discuss your situation with the supervisor and stay updated on the debtor’s proposals. Simultaneously, it is important to share your position with the supervisor so that your concerns can be factored into the repayment proposals.
– “Good communication with the supervisor allows the creditor to understand the restructuring plans and other actions the debtor intends to take. This helps creditors grasp the final outcome of the debtor’s and supervisor’s work, namely the repayment proposals sent to each creditor,” explains Adam Pasternak from Lege Restrukturyzacje.
Responding to a Settlement Proposal
Once you receive the settlement proposal, you can either accept or reject it. There is no option to renegotiate the terms. It is also worth remembering that a vote against the proposal does not automatically exempt the creditor from the restructuring outcome. An exception applies to debts secured by collateral. The proposal can still be approved if supported by the majority of creditors who cast valid votes, representing at least two-thirds of the total debt.
– “Restructuring is 99% of the time a better solution for creditors than bankruptcy. This process aims to find the best possible solution for both the creditor and the debtor. It’s worth considering what the debtor has to offer, as a better alternative is highly unlikely,” says Przemysław Furmanek from Lege Restrukturyzacje.
Source: Manager Plus
