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Controversy surrounding the surge in covenant lite across the US and Europe has overshadowed some less cyclical trends that are shifting lending practices

The Austrian Insolvency Code provides for bankruptcy proceedings, which lead to the winding-up and liquidation of a debtor company and restructuring proceedings, which seek to rescue a debtor company. Restructuring proceedings may be initiated with self-administration or without self-administration. Only restructuring proceedings under the Insolvency Code may lead to the relief from creditors.

A company may seek relief from its creditors whether it is solvent or insolvent. The solvency test in France is a cash-flow test. A company is insolvent (cessation de paiements) if it cannot make payment of a debt which is due and payable with its available cash and liquid reserves within the grace period granted by the relevant creditor.

Companies may seek relief from creditors in cases of insolvency due to illiquidity or over-indebtedness, and in cases of apparent threatening insolvency. Debtors may also petition the court to order a protection moratorium, during which insolvency cannot be declared. Stay effects of the impending insolvency are retained in such cases.

David Kurtz, global head of Lazard’s restructuring practice, reflects on US market trends and why the US remains the choice destination for forum shoppers

As a general rule, a company may be declared insolvent (concurso mercantil) when it has defaulted in its payment obligations to two or more creditors, and on the date of filing of the insolvency petition: (i) its due obligations that have been delinquent for more than 30 days represent 35% or more of its total outstanding obligations; and/or (ii) it does not have sufficient liquid assets (cash and cash equivalents, such as bank deposits and other receivables with a maturity of no more than 90 days, or securities that may be sold within 30 days, in each case from the date of filing of the insolvency request) to pay for at least 80% of its obligations that are due and payable on such date.

Informal workout: a company may come to an out-of-court agreement with its major creditors for the rescheduling of the company's debts and overall-rescheduling. Insolvency is not required to negotiate an informal workout.

The Debtor Rehabilitation and Bankruptcy Act (DRBA) governs bankruptcy proceedings and reorganisation proceedings in Korea. In this response, bankruptcy proceeding refers to the liquidation proceeding prescribed under the DRBA, reorganisation proceeding refers to the reorganisation proceeding prescribed under the DRBA, and insolvency proceeding refers collectively to a bankruptcy proceeding and a reorganisation proceeding

According to Republic Act 10142, or the Financial Rehabilitation and Insolvency Act of 2010 (FRIA), section 12, a company may seek relief from creditors by filing a petition for voluntary rehabilitation if it is: (i) insolvent; or (ii) unable to pay its obligations as they become due.