Chapter 8: The restructuring plan
There are major differences between US and UK law when it comes to the formulation and acceptance of a restructuring or reorganisation plan for an ailing company. The main differences are threefold and could be summarized as follows. Firstly, in the US, the debtor has an exclusive right to formulate a reorganization plan for a certain period of time whereas there is no such opportunity in the UK. Secondly, US law is much more prescriptive when it comes to division of creditors into classes. UK law is much less prescriptive in this regard. Thirdly, a class of creditors, including secured creditors in exceptional circumstances can be crammed down in the US, i.e. forced to accept a reorganization plan against its wishes provided that at least one other class of impaired creditors has accepted the plan.
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