1. The Receiver to submit to the court a Creditor List;
2. For the court to determine that the company’s “going concern” value is greater than the “liquidation” value of the company;
3. The Receiver to submit to the court a Rehabilitation Plan;
4. The Rehabilitation Plan to be approved by 2/3 of the unsecured and 3/4 of the secured claims.
This procedure is similar to Chapter 11 in the United States.
We have a few cases that are proving to be very difficult to obtain approval of both secured and unsecured creditors. Often, the Rehab Plan is, only, approved after litigation, prosecutions and/or one creditor gobbling up a good deal of the other debts. This case will be interesting.
For the purpose of full disclosure we are working on a few cases related to the rehabilitation of construction and other companies. My friend over at the Kimchi Law Blog motivated this post.
Sean Hayes may be contacted at: SeanHayes@ipglegal.com.
Sean Hayes is co-chair of the Korea Practice Team. He is the first non-Korean attorney to have worked for the Korean court system (Constitutional Court of Korea) and one of the first non-Koreans to be a regular member of a Korean law faculty. He assists clients in their contentious, non-contentious and business developments needs in Korea and China.
- Corporate Bankruptcy/Restructuring in Korea: The Line Begins Here (Korea’s Chapter 7 & 11 Bankruptcy)
- Korean Bankruptcy Court in Seoul, Korea Established
- Guide to Winding-Up/Permanetly Closing a Korea-based Company
- Is a Bankruptcy in the U.S. “Effective” on Assets in Korea?: Korean Bankruptcy Law Basics
- Korean Merger Control and the Korean FTC
- Korea Companies Defendants in Anti-Dumping Lawsuits Second to Only China: Check the Veracity of Data Produced by Korean Companies