Master thesis »Legal and economic analysis of the compulsory settlement proceeding over the company Thermana, d. d.« is intended to analyse the compulsory settlement procedure from a legal and an economic point of view on a specific subject of observation with the aim of answering the question of the necessity and adequacy of the existing legislative framework which determines “jus cogens” in the event of a threatening or already identified insolvency of an entity.
The introduction of the master's thesis addresses the question of the necessity of insolvency legislation and its impact on individual entities and on the entire economy. After a short introduction the focus is transferred to the specific empirical case in which the individual stages of the procedure, as defined by the Financial Operations, Insolvency Proceedings and Compulsory Winding-up Act, are analysed. The master's thesis thus deals with issues related to determining the insolvency of an entity, as well as questions regarding individual instruments designed to prevent the occurrence of insolvency or its elimination. One of such instruments is the preventive restructuring procedure which has been implemented for soon-to-be insolvent debtors. The master's thesis further contends with the conversion of debt into the company's capital (equity) and with the consistent implementation of the principle of absolute priority rule into the compulsory settlement procedure.
The master's thesis also touches upon the issue of real estate appraisal and the possibilities of manipulating their value as well as the risk of abuse of compulsory settlement procedures by creditors and the adequacy of legislation in preventing such abuse.
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