Payment agreements and settlements
At Sundgaard, we have extensive experience with all aspects of insolvency, bankruptcy and financial distress. We are qualified to help you or your business manage any financial challenges.
If a business is financially distressed, it may be necessary to try to make agreements with creditors. It can be a bank, suppliers or, for example, the Danish Debt Collection Agency.
You might also need a strategy towards agreements with your creditors in the event that your business is already undergoing bankruptcy proceedings and you have personally guaranteed for debts to, for example, a bank.
In any case, it is a good idea to have the right adviser to assist you. At Sundgaard, we assist with the negotiations and conclusion of creditor agreements and settlements. Often agreements result in an overall relaxation of payment terms, which again makes a potential personal bankruptcy irrelevant – to the benefit of the client and the creditors. Agreements are sometimes combined with the new capital and investors, which Sundgaard also has experience with.
Occasionally a creditor (most often the Danish Debt Collection Agency) will require some security to approve a creditor agreement. Often this requires an impartial attorney to submit a so-called section 13 (b)(3) declaration. The declaration primarily clarifies whether actions or transactions have been made that are avoidable in accordance with the Danish Bankruptcy Act or whether business conduct has been “grossly irresponsible”. We assist with the filing of these declarations.
Finally, it is important to act in due time, whether it being debt recovery, debt and creditor agreements or working with actual bankruptcy proceedings. Proceeds and dividends should be distributed swiftly and all people involved have an interest in proceedings being dealt with in reasonable time.