Agreement With Its Creditors
It is recognized that the agent`s provisions in the creditor agreement automatically apply to the authority, liability, obligations, discharge of liability and other matters relating to the officer`s performance of his services referred to in this Agreement. On July 6 last year, the Fernandez government formalized its final offer, with improvements to be made to the first, but which was rejected by the three main groups of private creditors who responded with a joint counter-offer. A composition with creditors differs in several respects from a transfer to creditors. It is created contractually, contrary to the common law or the law. Only creditors who consent are bound, while an assignment voluntarily assumes the debts discharged by the creditors. The terms of the composition determine whether the debtor retains the property. However, in most jurisdictions, the assets of a debtor who has transferred them to his creditors are given to a third party with a mandate to sell them and distribute the proceeds to creditors. Unlike an order, a composition is not a basis for an involuntary bankruptcy proceeding. Creditors will obviously never be happy to be offered a deal. It is often necessary to convince them to get them on board. In addition, it is important that the offer is better than bankruptcy.
Failure to comply with the terms of a composition forms the basis of an action for violation of the agreement. The debtor is not exempt from the payment obligation until he has complied with the payment rules. All debts that are part of a composition are erased as soon as a composition has been terminated. A contract entered into by an insolvent debtor or under financial pressure with two or more creditors, in which creditors agree to accept a certain partial payment of the total amount of their debts, which will be prorated among themselves in order to fully exploit their claims. Notwithstanding the provisions of the previous paragraph, the agent may, if he considers it reasonably necessary to implement the Floating Pledges as a matter of urgency, immediately enforce the Floating Pledges without following the majority creditors` decision-making procedures described in Article 2 of the creditors` agreement.