[BANKRUPTCY, INSOLVENCY & REHABILITATION PROCEEDINGS IN CHILE] 25
b) Out-Of-Court Reorganization The debtor has the option of reorganizing its debt directly with the support of 2 or more creditors which represent at least 75% of the debt in every category, excluding related creditors. The agreement must be entered into before a notary -or a faith officer-. Nonetheless, once accepted it requires Court´s approval. The Court´s role is to verify that the formalities and mandatory provisions (quorums) are complied with. Moreover, the debtor has to publish the agreement in the Insolvency Gazette. Creditors who might be excluded can oppose the agreement within 10 days from the publication. While the Court´s leave is processed, the debtor is granted stays of proceedings. 2) Liquidation of Companies a) Voluntary Liquidation A company may file an application to obtain its own liquidation under an insolvency scenario. The debtor is required to produce the following documents:
A list of its employees.
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Financial information and bank account statements considering a period of 2 years before the liquidation. An affidavit on the accuracy of the documents provided to the court.
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b) Forced Liquidation A creditor may file an application to claim the liquidation of its debtor in the following scenarios:
If the debtor is in breach of an obligation established in a “executive title” (a document which demonstrates an enforceable right that does not require a declaration i.e. a cheque). This ground cannot be invoked against debtor´s guarantors. If there are 2 or more debt collection proceedings against the debtor in connection to 2 or more unpaid executive titles, provided that the debtor has not offered enough assets to pay its debts within 4 days after service. If the debtor has closed its headquarters/offices and the location of its managers is unknown, provided that the company has not left any representative to respond to claims and its obligations.
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A list of all its assets, including a commercial assessment, disclosing their location and whether they are subject to any guarantee. In the case of real estate or assets registered in public records, certificates are also necessary. A list of its debts, including the name, address, contact information of its creditors, stating whether they have secured or unsecured credits. A list of the legal proceedings commenced against the debtor.
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The creditor has to submit before the court the same list of documents required for the voluntary liquidation. Also, interim measures can be granted to freeze debtor´s assets.
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ILN Restructuring & Insolvency Group – Bankruptcy, Insolvency & Rehabilitation Series
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