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The optimal design of credit contracts and bankruptcy procedures is an important policy question in both developed and developing economies. In this paper we deal with several theoretical considerations related to these important policy problems. The main concern of this paper is with the impact of the relaxation of bankruptcy procedures providing for the possibility of debt renegotiation instead of strictly imposing bankruptcy whenever the debtor falls into default on his or her debt. This paper contributes to the discussion on optimal bankruptcy procedures in the context of soft and hard budget constraint literature.

Background: The increasing intricacies of corporate bankruptcy and financial restructuring in the global economy highlight the importance of comprehending the procedures and results for distressed organizations. The article focuses on the lack of information and action regarding the recovery of financially struggling companies, acknowledging the significance of this matter for scholars, professionals, and policymakers. Objective: This study aims to analyze the complexities of corporate bankruptcy, emphasizing the legal, financial, and operational obstacles and solutions used by corporations to manage financial difficulties. The goal is to provide a detailed examination of the methods and institutions that support business recovery and the impact on different stakeholders. Methodology: Utilising a qualitative research approach, the article conducts a thorough examination of legal texts, empirical case studies, and relevant datasets related to corporate bankruptcy and restructuring. The goal is to clarify the functions of various bankruptcy processes, including debtor-in-possession financing, and alternatives like out-of-court restructuring. Results: The results emphasize the many tactics used by corporations to reduce financial hardship, focusing on the interconnection between legal regulations, financial tools, and stakeholder involvement. The study reveals the key aspects that impact the effectiveness of restructuring initiatives, such as protecting stakeholder interests, ensuring employee well-being, and adhering strictly to legal obligations. The article provides information on the difficulties and factors that help with restructuring procedures, giving a better understanding of the practical elements involved in managing corporate bankruptcy. Conclusion: The article enhances comprehension of corporate bankruptcy and financial restructuring, emphasizing the need for a comprehensive strategy that focuses on legal compliance and stakeholder interests. This emphasizes the consequences for the continuous recovery of companies in an uncertain economic setting and proposes avenues for future study and application in the field of corporate financial revitalization. The results support the need for deliberate and well-informed decision-making to improve the resilience and recovery of struggling organizations.

Foreword / by Bob Wessels -- Historical perspectives -- The history of corporate turnaround management : personal reflections / Donald Bibeault -- Business rescue, turnaround management and the legal regime of default and -- Insolvency in western history (late middle ages to present day) / Dave De Ruysscher -- Business failure -- Some causes of organizational decline / William McKinley -- Predicting business failure / Nico Dewaelheyns, Sofie De Prijcker, and Karen Van Den Heuvel -- A theoretical framework for restructuring / Joost de Haas and Pieter Klapwijk -- Valuation in good times and bad / Jan Vis -- Turnaround management -- Turnaround planning : insights from evolutionary approaches to the theory of the firm / Gianpaolo Abatecola and Vincenzo Uli -- Turnaround strategies : practical insights from a 47-year career / Donald Bibeault -- Why must companies reorganize and why do they wait so long? : insights from practice / Kathryn Rudie Harrigan -- Human considerations in turnaround management : a practitioner?s view / Yuval Bar-Or -- The executioner's dilemma : explaining role stress by ethical conflict among those that carry out a downsizing event / Rick Aalbers and Philippos Philippou -- Legal issues and ethics -- Why rescue? : a critical analysis of the current approach to corporate rescue / David Burdette and Paul Omar -- Towards a European business rescue culture / Gert-Jan Boon and Stephan Madaus -- Effectiveness of preventive insolvency frameworks in the EU / Mihaela Carpus Carcea, Daria Ciriaci, Carlos Cuerpo Caballero, Dimitri Lorenzani, and Peter -- Pontuch -- An overview of the pre-insolvency procedures in the united kingdom and south africa / Alexandra Kastrinou and Lezelle Jacobs -- The ethics of state bankruptcy / Jukka Kilpi and Simon Elo -- Industry perspectives -- Firm turnarounds in knowledge intensive industries / Vincent Barker III and Achim Schmitt -- Turning smes around : on breaking and making organizational paths / Jorg Freiling and Hartmut Meyer -- Cases & game -- Back to the future : the general motors restructuring plan / Jan Adriaanse -- Business failure in the U.S. restaurant industry / H. G. Parsa -- Turnaround workout game : to rescue the uganda hotel-casino group, or not? / Jan Adriaanse, Arnoud Griffioen, and Jean-Pierre van der Rest -- Epilogue: a synopsis of the present and future of turnaround management and bankruptcy / Tim Verdoes, Jean-Pierre van der Rest, and Jan Adriaanse -- Index of terms -- Index of names

Considers (74) H.R. 6249. ; Committee Serial No. 3. Considers legislation to revise railroad bankruptcy procedures. ; Record is based on bibliographic data in CIS US Congressional Committee Hearings Index. Reuse except for individual research requires license from Congressional Information Service, Inc. ; Indexed in CIS US Congressional Committee Hearings Index Part IV ; Considers (74) H.R. 6249. ; Committee Serial No. 3. Considers legislation to revise railroad bankruptcy procedures. ; Mode of access: Internet.

A claim concerning the initiation of bankruptcy proceedings is not only an application to recognize the right but also to apply the entirety of measures that are intended to the salvation of the company in order to proportionally satisfy the requirements of the creditors related exclusively to the assets of the company debtor. Notwithstanding to the aim of the legislative body to protect the interests of creditors, the rights of the shareholders of the company debtor is of no less importance. However such rights are lesser discussed topic. The study revealed that the shareholders have property and non-property rights that may be exercised in compliance with legislation. In case of initiation of the bankruptcy proceedings with a court, the shareholders retain their rights, however their property rights as well as no-property rights are limited to the benefit of the creditors. The study revealed that during bankruptcy procedure the shareholders retain just one right provided for by the Law on Companies of the Republic of Lithuania, namely: to receive a part of assets of the company under liquidation, in case of the liquidation of the company. The Law on Enterprise Bankruptcy of the Republic of Lithuania provides for the following rights acquired by the shareholders of the company from the beginning of the bankruptcy procedures:1) to file explanations; 2) to make a proposal to the company to start non-judicial bankruptcy proceedings 3) to enter into agreements related to the liquidation, restructurisation of the company; 4) to reach out-of-court agreement. The Civil Code provides for the right protection with a court and self-defence. It may be noted that the right to reach out-of-court agreement and the right to enter into agreements regarding the liquidation, restructurisation of the company as well as to file a claim concerning initiation of bankruptcy proceedings in respect of the company and reparation of damage made to the company with a court, are considered to be the shareholders' rights protection methods. The above-mentioned right protection methods are the issue of the thesis. It may be noted that the protection of the shareholders' rights in the bankruptcy proceedings is rather weak, frequently not properly implemented, or is even not implemented at all. Therefore, it may be concluded that more attention must be given to the protection of the shareholders' rights and to the alteration of the established court practice.

A claim concerning the initiation of bankruptcy proceedings is not only an application to recognize the right but also to apply the entirety of measures that are intended to the salvation of the company in order to proportionally satisfy the requirements of the creditors related exclusively to the assets of the company debtor. Notwithstanding to the aim of the legislative body to protect the interests of creditors, the rights of the shareholders of the company debtor is of no less importance. However such rights are lesser discussed topic. The study revealed that the shareholders have property and non-property rights that may be exercised in compliance with legislation. In case of initiation of the bankruptcy proceedings with a court, the shareholders retain their rights, however their property rights as well as no-property rights are limited to the benefit of the creditors. The study revealed that during bankruptcy procedure the shareholders retain just one right provided for by the Law on Companies of the Republic of Lithuania, namely: to receive a part of assets of the company under liquidation, in case of the liquidation of the company. The Law on Enterprise Bankruptcy of the Republic of Lithuania provides for the following rights acquired by the shareholders of the company from the beginning of the bankruptcy procedures:1) to file explanations; 2) to make a proposal to the company to start non-judicial bankruptcy proceedings 3) to enter into agreements related to the liquidation, restructurisation of the company; 4) to reach out-of-court agreement. The Civil Code provides for the right protection with a court and self-defence. It may be noted that the right to reach out-of-court agreement and the right to enter into agreements regarding the liquidation, restructurisation of the company as well as to file a claim concerning initiation of bankruptcy proceedings in respect of the company and reparation of damage made to the company with a court, are considered to be the shareholders' rights protection methods. The above-mentioned right protection methods are the issue of the thesis. It may be noted that the protection of the shareholders' rights in the bankruptcy proceedings is rather weak, frequently not properly implemented, or is even not implemented at all. Therefore, it may be concluded that more attention must be given to the protection of the shareholders' rights and to the alteration of the established court practice.

Spine title: Roche & Hazlitt on bankruptcy. ; Includes legislation. ; Mode of access: Internet.

This book introduces and analyzes a new and more predictable bankruptcy process designed specifically for large financial institutions, Chapter 14, to achieve greater financial stability and reduce the likelihood of bailouts. The contributors identify and compare the major differences in the Dodd-Frank Title II and the proposed new procedures and outline the reasons why Chapter 14 would be more effective in preventing both financial crises and bailouts.

1. Procedure of bankruptcy in Lithuania is ineffective, what stipulates quite high social costs of bankruptcy.2. Analysis of Lithuanian statistical data showed that significant part of insolvent enterprise (estimated 40%) is neither rehabilitated or reorganized nor liquidated-decision hasn't been made at all. Such situation stipulates enhancing of labilities, what even more complicate liquidation process of insolvent enterprises.3. Problem of diagnostics of insolvency in Lithuania is quite urgent. No one from available criteria of insolvency could be treated as unconditionally acceptable for practical purposes. In the article suggested new accomplished insolvency criteria: balance value of assets reduced by value of pledged property compared to liabilities reduced by sum of credits received for the pledged property. Having in mind that formal criteria could cause procedure of bankruptcy even for firms, which suffer losses temporary, presented insolvency criterion should be tied up to one or several profitability indexes.4. Following change of sequence of fulfillment of financial claims would stipulate increase of efficiency of bankruptcy procedure: after meeting liabilities of collateral holders and employees, all left liabilities should be met proportionally. Government regulates business conditions, so should bear responsibility for impact of economical policy on financial results of business firm. Additionally the highest and the lowest limits of claims of other creditors should be set. That orientated partners of business firms to more extensive use of insurance from various risks and determined the smaller social costs of bankruptcy processes. ; Straipsnyje nagrinėjamas įmonių bankroto procesas Lietuvoje. Atlikta bankrutavusių ir bankrutuojančių įmonių statistinė analizė leidžia atskleisti negatyvias tendencijas Lietuvoje: daugelis nemokių įmonių nei reorganizuojama, nei sanuojama, nei likviduojama, o tai savo ruožtu sąlygoja didelius visuomeninius kaštus. Nagrinėjamos įmonių bankroto proceso neefektyvumo priežastys; ypač akcentuojama įmonės nemokumo kriterijaus bei kreditorinių įsipareigojimų tenkinimo tvarkos reikšmė. Straipsnyje suformuluojamas naujas, tinkamas praktiniam naudojimui įmonės nemokumo kriterijus bei argumentuojama efektyvesnė kreditorinių pretenzijų tenkinimo tvarka.