SPAIN Law and Practice Contributed by: Antonio Paredes, Carlos Saldaña, Manuel Martínez and Román Mejías, ZADAL
7.10 Expedited Restructurings Spanish law allows for expedited, pre-arranged restructurings through court-supervised restructuring plans that are negotiated largely out of court and filed once creditor support has been secured. In practice, these processes resemble pre-packaged restructur - ings, with the debtor agreeing the economic terms in advance with its core financial creditors and then seeking swift court confirmation. Approval is based on class voting, with the required majorities varying depending on whether creditors are secured or unse - cured, and dissenting classes may be crammed down if statutory conditions are met. Where the restructuring is primarily balance-sheet driven, it is typically implemented through debt rescheduling, haircuts, debt-for-equity swaps or new money transactions embedded in a restructuring plan, without significant operational changes. Courts will generally enforce restructuring support agree - ments and lock-up arrangements, provided they do not infringe mandatory insolvency rules or creditor equality principles, and provided the resulting plan meets the statutory fairness, valuation and procedural requirements.
extensions, rescheduling, partial equitisation and sometimes new money. Because it lacks statutory cram-down or moratorium effects, success depends on alignment among key financial creditors and a rela - tively simple capital structure, and it often requires co- operation from shareholders for governance changes, debt-for-equity steps, additional security or structural moves; trade creditors are typically handled bilaterally as they cannot be bound without consent. By contrast, in-court restructuring offers stronger tools: a court-backed stay on enforcement, the abil - ity to bind dissenting creditors through cross-class cram-down, and enhanced protection for new money and interim financing against clawback. Court-super - vised sale processes can also facilitate going-concern transfers that are largely free and clear of prior claims and encumbrances, supporting value-preserving out - comes. 7.9 Dissenting Lenders and Non-Consensual Restructurings Spanish law provides robust mechanisms to deal with dissenting lenders through court-supervised restruc - turing proceedings. Where the statutory requirements are met, a restructuring plan may be approved and imposed on dissenting financial creditors through class-based voting and cross-class cram-down, pro - vided that minimum majority thresholds are achieved and the plan complies with valuation and fairness tests. Dissenting lenders are protected by a number of safe - guards. These include the requirement that they be no worse off than in the relevant counterfactual sce - nario, typically liquidation, respect for the absolute or relative priority rules as adapted under Spanish law, and the right to challenge the plan on procedural or substantive grounds. In addition, secured creditors benefit from specific protections regarding the value of their collateral, and any impairment of their rights is subject to judicial scrutiny.
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