31:
740:
creditors, and so in order to ensure that the plan can be confirmed by the bankruptcy court, the plan proponents must secure the support of at least two-thirds in amount and more than one-half in number of at least one such impaired class, in addition to ensuring the plan complies with all other requirements for confirmation. Two procedurally difficult aspects of the process are the announcement (which must be structured so as not to trigger contractual termination provisions) and getting the requisite creditor approval.
724:. A conventional bankruptcy case is one in which the debtor files for Chapter 11 relief without having agreed in advance to the terms of a plan of reorganization with its creditors. During the course of the Chapter 11 case, the debtor or, if the debtor does not retain the exclusive right to propose a plan, a creditor or creditor group may formulate and propose a plan of reorganization. A company undergoing Chapter 11 reorganization is effectively operating under the
701:(TUPE). Another big advantage is that the cost of the process is lower than trading administration, as the administrators do not need to find funding to trade the business. The downside of a pre-pack administration is that it can attract negative publicity if the former directors are seen to be shedding liabilities.
581:
The term "pre-pack sale" has been defined by the
Association of Business Recovery Professionals as "an arrangement under which the sale of all or part of a company’s business or assets is negotiated with a purchaser prior to the appointment of an administrator, and the administrator effects the sale
791:
identified the several criticisms of pre-pack sales. There is a general concern that the pre-pack administrator, in agreeing to the pre-pack in consultation with the company’s management team (and usually its secured creditors), favours the interests of the managers and secured creditors ahead of
641:
If the business or business assets have been acquired from an insolvency practitioner within the previous 24 months, or longer if the administrator deems that relevant to creditors’ understanding, the administrator should disclose both the details of that transaction and whether the administrator,
589:
basis, rather than after post-appointment marketing, vary from case to case, but they often involve the following considerations. A pre-pack sale avoids the costs of trading (which means creditors receive more back), and indeed, the company and the administrator may not have the funds to trade. It
596:
The courts have held that an administrator can sell the company's assets immediately upon his appointment, without court approval or the approval of the creditors, and he can do so even if the majority creditor objects. Courts have even approved transactions that, as a "necessary evil", have made
739:
In a pre-packaged case, the plan proponents will have secured sufficient support from creditors to confirm their plan of reorganization prior to filing for
Chapter 11 reorganization. Pre-packaged plans of reorganization virtually always impair (i.e. pay less than in full) one or more classes of
657:
The rationale for the basis of the valuations obtained and an explanation of the sale of the assets compared to those valuations. If no valuation has been obtained, the reason for not having done so and how the administrator was satisfied as to the value of the
30:
608:
to require insolvency practitioners acting as administrators to disclose a number of matters to all creditors as soon as possible after the completion of the sale. This was done in an attempt to provide greater transparency to creditors.
582:
immediately on, or shortly after, his appointment". The difference between a pre-pack sale and a normal sale is that in a normal sale the administrator markets the business and negotiates the terms of the sale after his appointment.
673:
In transactions impacting on more than one related company (e.g. a group transaction) the administrator should ensure that the disclosure is sufficient to enable a transparent explanation (for instance, allocation of consideration
696:
The main benefit of a pre-pack administration is the 'continuity' of the business - the company is protected by the court. This gets rid of debts and contracts. It does not get rid of employees due to the
792:
those of the unsecured creditors. The speed and secrecy of the transaction often lead to a deal being executed, about which the unsecured creditors know nothing and offers them little or no return.
670:
The names of any directors, or former directors, of the company who are involved in the management or ownership of the purchaser, or of any other entity into which any of the assets are transferred
698:
751:
reorganization. As ranked by total assets, GM's bankruptcy marks one of the largest corporate
Chapter 11 bankruptcies in US history. The Chapter 11 filing was the
867:
907:
708:
monitors compliance with SIP 16. Its reports show that in 2010 it reported 10 insolvency practitioners to their licensing bodies, and in 2011 it reported 21.
677:
Whether any directors had given guarantees for amounts due from the company to a prior financier, and whether that financier is financing the new business
590:
also avoids the administrator taking on the risks associated with trading. The value of the business may deteriorate during administration trading.
879:
334:
935:
683:
The consideration for the transaction, terms of payment, and any condition of the contract that could materially affect the consideration
752:
390:
564:
319:
190:
446:
57:
626:
The alternative courses of action that were considered by the administrator, with an explanation of possible financial outcomes
1053:"The 10 Largest U.S. Bankruptcies: From Lehman to Texaco, the Mighty Have Fallen, Taking Down Billions and Billions with Them"
868:
http://www.bailii.org/cgi-bin/markup.cgi?doc=/ew/cases/EWHC/Ch/2010/2036.html&query=halliwells+and+LLP&method=boolean
360:
686:
Sale consideration disclosed under broad asset valuation categories and split between fixed and floating charge realisations
667:
Any connection between the purchaser and the directors, shareholders or secured creditors of the company or their associates
519:
185:
921:
795:
There is often a suspicion that the consideration paid for the business may not have been maximized due to the absence of
1052:
817:
632:
Why it was not appropriate to trade the business and offer it for sale as a going concern, during the administration
779:(IPO) of stock in 2010. The remaining pre-petition creditors claims are paid from the former corporation's assets.
82:
772:
415:
648:
The names and professional qualifications of any valuers and confirmation they have confirmed their independence
385:
799:. Credit may have been incurred inappropriately prior to the pre-pack and this may not be fully investigated.
645:
Any marketing activities conducted by the company and/or the administrator and the outcome of those activities
539:
procedure, where a restructuring plan is agreed upon in advance of a company declaring its insolvency. In the
410:
405:
370:
62:
400:
961:
466:
355:
890:
788:
512:
395:
380:
365:
350:
236:
1100:"A Comparative Analysis of Anglo-Australian Pre-packs: Can the Means Be Made to Justify the Ends?"
692:
If the sale is part of a wider transaction, a description of the other aspects of the transaction.
776:
493:
436:
324:
262:
113:
92:
743:
In 2009, a new entity completed the purchase of continuing operations, assets and trademarks of
768:
226:
431:
329:
221:
205:
159:
138:
133:
654:
A summary of the basis of the valuation adopted by the administrator or his valuers/advisers
556:
441:
47:
8:
1171:
689:
Any options, buy-back arrangements or similar conditions attached to the contract of sale
552:
505:
375:
851:
829:
1133:
705:
620:
The source of the administrator’s initial introduction and the date of the introduction
598:
461:
252:
169:
1148:
760:
576:
488:
471:
456:
303:
231:
123:
72:
1081:
1013:
1114:
986:
841:
Re T&D Industries Plc 1 WLR 646; Re
Transbus International Limited 1 WLR 2654
733:
729:
298:
267:
164:
128:
818:
http://www.r3.org.uk/media/documents/technical_library/SIPS/SIP%2016%20E&W.pdf
635:
Details of requests made to potential funders to fund working capital requirements
756:
283:
67:
1134:"When is pre-packaged administration appropriate? – A Theoretical Consideration"
1099:
863:
744:
548:
16:
Kind of bankruptcy procedure where a restructuring plan has already been agreed
1165:
1152:
540:
200:
880:"Statement of Insolvency Practice 16: Pre-Packaged Sales In Administrations"
593:
There may be other factors to prevent trading, such as regulatory problems.
604:
In
January 2009, the Association of Business Recovery Professionals issued
559:
the dominant insolvency procedure. Such arrangements are also available in
97:
77:
1030:
796:
257:
87:
748:
544:
536:
477:
52:
22:
616:
was introduced. It requires administrators to disclose the following:
612:
On 1 November 2013, following a government-commissioned review, a new
1118:
597:
payments to the former management while leaving little or nothing to
195:
699:
Transfer of
Undertakings (Protection of Employment) Regulations 2006
764:
586:
293:
154:
118:
771:
was formed to acquire profitable assets, under section 363 of the
623:
The extent of the administrator’s involvement prior to appointment
908:"Statements of Insolvency Practice: For insolvency practitioners"
680:
Details of the assets involved and the nature of the transaction
651:
Any valuations obtained of the business or the underlying assets
560:
451:
1031:"Obama: GM bankruptcy viable, achievable - Autos- NBC News"
288:
629:
Whether efforts were made to consult with major creditors
962:"Delta and Northwest airlines both file for bankruptcy"
828:
see, for example, Re DKLL Solicitors EWHC 2067 (Ch),
922:"21 IPs reported for pre-pack non-compliance in 2011"
852:
http://www.bailii.org/ew/cases/EWHC/Ch/2007/2067.html
830:
http://www.bailii.org/ew/cases/EWHC/Ch/2007/2067.html
1080:
Stoll, John D., and David McLaughlin (July 2, 2009).
638:
Details of registered charges and dates of creation
1012:Stoll, John D., and Neil King Jr. (July 10, 2009).
728:of the court until it emerges. An example is the
1163:
987:"3 Tips For Acing A Prepackaged Ch. 11 - Law360"
642:administrator’s firm or associates were involved
1097:
960:Isidore, Chris; Senior, /Money (2005-09-14).
959:
936:"The Pros And Cons Of Prepackaged Bankruptcy"
513:
1098:Wellard, Mark; Walton, Peter (26 Sep 2012).
775:, with the new company planning to issue an
813:
811:
551:, pre-packs have become popular since the
520:
506:
736:was on airlines that were in Chapter 11.
716:In the United States, typically the term
1008:
1006:
808:
585:The reasons an administrator sells on a
1050:
1044:
1164:
1131:
1076:
1074:
1147:. Nottingham Trent University: 1–13.
1082:General Motors Aims for IPO Next Year
1051:Tkaczyk, Christopher (June 1, 2009).
1023:
1003:
767:A new entity with the backing of the
565:Companies' Creditors Arrangements Act
850:Re DKLL Solicitors EWHC 2067 (Ch),
732:; in 2006, over half the industry's
1071:
614:Statement of Insolvency Practice 16
606:Statement of Insolvency Practice 16
13:
29:
14:
1183:
832:for consideration of these issues
570:
747:as a part of the 'pre-packaged'
711:
1125:
1107:International Insolvency Review
1091:
979:
953:
928:
914:
900:
872:
856:
844:
835:
822:
543:pre-packs are often used in a
1:
1088:. Retrieved on July 10, 2009.
1020:. Retrieved on July 10, 2009.
802:
757:Lehman Brothers Holdings Inc.
664:The identity of the purchaser
782:
753:fourth-largest in US history
535:(a "pre-pack") is a kind of
7:
661:The date of the transaction
10:
1188:
1014:GM Emerges From Bankruptcy
866:EWHC 2036 (Ch) at para 20
574:
467:History of bankruptcy law
789:Wolverhampton University
237:Voidable floating charge
1086:The Wall Street Journal
1033:. NBC News. 31 May 2009
1018:The Wall Street Journal
777:initial public offering
722:pre-packaged insolvency
718:pre-packaged bankruptcy
533:Pre-packaged insolvency
484:Pre-packaged insolvency
437:Bankruptcy alternatives
325:Cross-border insolvency
263:Trading while insolvent
114:Insolvency practitioner
93:Provisional liquidation
1141:Nottingham Law Journal
1132:Walton, Peter (2011).
769:United States Treasury
227:Undervalue transaction
34:
432:Anti-deprivation rule
330:Insolvency Regulation
222:Fraudulent conveyance
206:Scheme of arrangement
160:Preferential creditor
139:Trustee in bankruptcy
134:Referee in Bankruptcy
33:
720:is used instead of
599:unsecured creditors
553:Enterprise Act 2002
186:Administration (UK)
706:Insolvency Service
462:Financial distress
335:UNCITRAL Model Law
253:Fraudulent trading
170:Unsecured creditor
35:
761:Washington Mutual
577:UK insolvency law
555:, which has made
530:
529:
489:Sovereign default
472:List of bankrupts
442:Creditors' rights
304:Security interest
232:Unfair preference
214:Avoidance regimes
124:Regulatory agency
1179:
1157:
1156:
1138:
1129:
1123:
1122:
1119:10.1002/iir.1201
1104:
1095:
1089:
1078:
1069:
1068:
1066:
1064:
1048:
1042:
1041:
1039:
1038:
1027:
1021:
1010:
1001:
1000:
998:
997:
983:
977:
976:
974:
972:
957:
951:
950:
948:
946:
940:
932:
926:
925:
918:
912:
911:
904:
898:
897:
896:on 24 June 2015.
895:
889:. Archived from
884:
876:
870:
860:
854:
848:
842:
839:
833:
826:
820:
815:
734:seating capacity
730:airline industry
522:
515:
508:
299:Second lien loan
268:Wrongful trading
165:Secured creditor
19:
18:
1187:
1186:
1182:
1181:
1180:
1178:
1177:
1176:
1162:
1161:
1160:
1136:
1130:
1126:
1102:
1096:
1092:
1079:
1072:
1062:
1060:
1049:
1045:
1036:
1034:
1029:
1028:
1024:
1011:
1004:
995:
993:
985:
984:
980:
970:
968:
958:
954:
944:
942:
938:
934:
933:
929:
920:
919:
915:
910:. 7 April 2014.
906:
905:
901:
893:
882:
878:
877:
873:
861:
857:
849:
845:
840:
836:
827:
823:
816:
809:
805:
785:
773:Bankruptcy Code
714:
579:
573:
547:filing. In the
526:
320:Chapter 15 (US)
284:Floating charge
191:Chapter 11 (US)
68:Conservatorship
17:
12:
11:
5:
1185:
1175:
1174:
1159:
1158:
1124:
1113:(3): 143–181.
1090:
1070:
1043:
1022:
1002:
991:www.law360.com
978:
952:
927:
913:
899:
871:
864:Halliwells LLP
855:
843:
834:
821:
806:
804:
801:
797:open marketing
787:A review from
784:
781:
745:General Motors
713:
710:
694:
693:
690:
687:
684:
681:
678:
675:
671:
668:
665:
662:
659:
655:
652:
649:
646:
643:
639:
636:
633:
630:
627:
624:
621:
572:
571:United Kingdom
569:
557:administration
549:United Kingdom
528:
527:
525:
524:
517:
510:
502:
499:
498:
497:
496:
491:
486:
481:
474:
469:
464:
459:
454:
449:
447:Chapter 9 (US)
444:
439:
434:
426:
425:
421:
420:
419:
418:
413:
411:United Kingdom
408:
403:
398:
393:
388:
383:
378:
373:
368:
363:
358:
353:
345:
344:
340:
339:
338:
337:
332:
327:
322:
314:
313:
309:
308:
307:
306:
301:
296:
291:
286:
278:
277:
273:
272:
271:
270:
265:
260:
255:
247:
246:
242:
241:
240:
239:
234:
229:
224:
216:
215:
211:
210:
209:
208:
203:
198:
193:
188:
180:
179:
175:
174:
173:
172:
167:
162:
157:
149:
148:
144:
143:
142:
141:
136:
131:
126:
121:
116:
108:
107:
103:
102:
101:
100:
95:
90:
85:
80:
75:
70:
65:
60:
58:Chapter 7 (US)
55:
50:
48:Administration
42:
41:
37:
36:
26:
25:
15:
9:
6:
4:
3:
2:
1184:
1173:
1170:
1169:
1167:
1154:
1150:
1146:
1142:
1135:
1128:
1120:
1116:
1112:
1108:
1101:
1094:
1087:
1083:
1077:
1075:
1058:
1057:money.cnn.com
1054:
1047:
1032:
1026:
1019:
1015:
1009:
1007:
992:
988:
982:
967:
963:
956:
937:
931:
924:. 2012-05-15.
923:
917:
909:
903:
892:
888:
887:Lucas Johnson
881:
875:
869:
865:
859:
853:
847:
838:
831:
825:
819:
814:
812:
807:
800:
798:
793:
790:
780:
778:
774:
770:
766:
765:WorldCom Inc.
762:
758:
754:
750:
746:
741:
737:
735:
731:
727:
723:
719:
712:United States
709:
707:
702:
700:
691:
688:
685:
682:
679:
676:
672:
669:
666:
663:
660:
656:
653:
650:
647:
644:
640:
637:
634:
631:
628:
625:
622:
619:
618:
617:
615:
610:
607:
602:
600:
594:
591:
588:
583:
578:
568:
566:
562:
558:
554:
550:
546:
542:
541:United States
538:
534:
523:
518:
516:
511:
509:
504:
503:
501:
500:
495:
494:Subordination
492:
490:
487:
485:
482:
480:
479:
475:
473:
470:
468:
465:
463:
460:
458:
455:
453:
450:
448:
445:
443:
440:
438:
435:
433:
430:
429:
428:
427:
423:
422:
417:
416:United States
414:
412:
409:
407:
404:
402:
399:
397:
394:
392:
389:
387:
384:
382:
379:
377:
374:
372:
369:
367:
364:
362:
359:
357:
354:
352:
349:
348:
347:
346:
342:
341:
336:
333:
331:
328:
326:
323:
321:
318:
317:
316:
315:
312:International
311:
310:
305:
302:
300:
297:
295:
292:
290:
287:
285:
282:
281:
280:
279:
275:
274:
269:
266:
264:
261:
259:
256:
254:
251:
250:
249:
248:
244:
243:
238:
235:
233:
230:
228:
225:
223:
220:
219:
218:
217:
213:
212:
207:
204:
202:
201:Restructuring
199:
197:
194:
192:
189:
187:
184:
183:
182:
181:
178:Restructuring
177:
176:
171:
168:
166:
163:
161:
158:
156:
153:
152:
151:
150:
146:
145:
140:
137:
135:
132:
130:
127:
125:
122:
120:
117:
115:
112:
111:
110:
109:
105:
104:
99:
96:
94:
91:
89:
86:
84:
81:
79:
76:
74:
71:
69:
66:
64:
61:
59:
56:
54:
51:
49:
46:
45:
44:
43:
39:
38:
32:
28:
27:
24:
21:
20:
1144:
1140:
1127:
1110:
1106:
1093:
1085:
1061:. Retrieved
1056:
1046:
1035:. Retrieved
1025:
1017:
994:. Retrieved
990:
981:
971:November 17,
969:. Retrieved
965:
955:
943:. Retrieved
930:
916:
902:
891:the original
886:
874:
858:
846:
837:
824:
794:
786:
755:, following
742:
738:
725:
721:
717:
715:
703:
695:
613:
611:
605:
603:
595:
592:
584:
580:
532:
531:
483:
476:
401:South Africa
98:Receivership
78:Examinership
406:Switzerland
258:Misfeasance
88:Liquidation
73:Dissolution
1172:Bankruptcy
1037:2009-06-01
996:2016-07-27
803:References
749:Chapter 11
726:protection
575:See also:
563:under the
545:Chapter 11
537:bankruptcy
478:Pari passu
343:By country
129:Liquidator
53:Bankruptcy
23:Insolvency
1153:0965-0660
1059:. Fortune
941:. Law 360
783:Criticism
381:Hong Kong
356:Australia
196:Cram down
147:Claimants
106:Officials
40:Processes
1166:Category
587:pre-pack
351:Anguilla
294:Mortgage
276:Security
245:Offences
155:Creditor
119:Tribunal
1063:June 1,
945:28 July
457:Default
391:Ireland
1151:
658:assets
561:Canada
452:Debtor
396:Russia
371:Cayman
366:Canada
1137:(PDF)
1103:(PDF)
939:(PDF)
894:(PDF)
883:(PDF)
674:paid)
424:Other
386:India
376:China
1149:ISSN
1065:2009
973:2005
947:2014
763:and
704:The
289:Lien
1115:doi
966:CNN
862:Re
361:BVI
83:IVA
63:CVA
1168::
1145:20
1143:.
1139:.
1111:21
1109:.
1105:.
1073:^
1055:.
1005:^
989:.
964:.
885:.
810:^
759:,
601:.
567:.
1155:.
1121:.
1117::
1084:.
1067:.
1040:.
1016:.
999:.
975:.
949:.
521:e
514:t
507:v
Text is available under the Creative Commons Attribution-ShareAlike License. Additional terms may apply.
_(style_of)_-_A_Hand_Holding_an_Empty_Purse,_The_Emblem_of,_%E2%80%98No_suffering_can_compare%27_(with_that_of_the_bankrupt_spendthrift)_-_1298194_-_National_Trust.jpg){kind=spacer}