Trusteeships are frequently used instruments in the reorganisation process. Trusteeship models can be used to deal constructively with a loss of trust between the actors involved that has arisen over the course of a crisis, and thus they are also a way to overcome complex crisis situations.
For example, by establishing a trusteeship, shareholders’ shares in a crisis-prone company or other securities can be transferred to a trustee, who then holds them in trust for the benefit of one or more creditors and who can then realise them if previously established conditions have been met. In this way, a trustee solution can make it possible to provide financing even in crisis situations. Interposing a trustee can avoid the transfer of a business share to the creditor, thereby ruling out the subordination of the loan repayment claim, which would apply should the borrower of a shareholder loan face insolvency (section 39 subsection 1 No. 5 of the Insolvency Statute (InsO)).
Thanks to our many years of highly specialised consulting and insolvency administration activities, LEONHARDT RATTUNDE can advise you on the subject of trusteeships and help you plan and implement trusteeship models.
Even in the event of a crisis, a trusteeship can still provide financing under certain circumstances.