Restructuring Plans · glossary
The first condition for cram down: no creditor in the class that voted no may be worse off under the plan than in the relevant alternative. Valkenrade’s noteholders get €70 for every €100 under the plan, against €30 in the bankruptcy, so the test is met. Explanatory Statement, paragraph 5.3 · Chapter 7 · see Cram down, Relevant alternative
Explained in Chapter 7, The Relevant Alternative and the No Worse Off Test, of Restructuring Plans.
The answer is the relevant alternative. For Valkenrade, it is the bankruptcy of the group. The court then applies the no worse off test. No creditor in the class that said no may end up worse off under the plan than without it.Read Chapter 7, The Relevant Alternative and the No Worse Off Test →
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