- Increase the proportion of assets over liabilities;
- Resulting value of current assets is equal to or greater than current liabilities (short term liabilities);
- Resulting value of security granted in favour of the creditors involved by the agreement does not exceed either 9/10 of the value of the outstanding debt owed to such creditors, or the proportion of the outstanding debt guarantees they had before the agreement;
- The interest debt applicable in favour of the creditors affected by the agreement does not exceed 1/3 of the applicable to previous debt; and
- The agreement is granted by a Notary Public, signed by all the creditors affected and the debtor, and also states the economic reasons justifying the agreement.
New refinancing agreements protected without collective approval by the creditors
The Spanish Insolvency Law 22/2003 has been amended by the Royal Decree-Law 4/2014 (RD-Law). This RD-Law introduces very important innovations, and here we want to remark a new kind of refinancing agreements that not require a previous collective approval to be immune to claw back actions.
Therefore, the particularity is that this type of agreement requires no approval by creditors or judicial approval.
In fact, its application depends on very strict requirements, because if the agreements do not improve the equity (financials of the company) cannot be protected.
This kind of refinancing agreements require the following cumulative conditions: