a a °) son baw RENEW come in Connection ies arising. I! With, cots, Mian and Reports 5 prosee 57.5 sag Fraud in COnMECION yy uit bl actions (SC. 58, SRC) cuties TH Jn uri secur ity for Manipulation of SECUTY Prcg, cow (e580) Dorma See acorn rae Co er cose ones 61, SRC) ‘on Account of Insider Trading (see, FINANCIAL REHABILITATION AND INSOLVENCY ACT ‘state Policy Ins the policy ofthe state to enco juridical and-natural persons Cotectively and realsically ces coims and property sights. In furthers et State shall ensure a timely far, transparent cheese aticlentrehabitation ‘oF liquidation of ‘deter ae rehbiltation or liquidation shall be made vith swe fnsute OF maintain certainty and predctobig commercial affairs, preserve and masini the we the asets of these debtors, recogniae redtoy rhc respect print of aims, and ensure equate enon af creditors who are simiary “stuated, nent rehabilitation is not feasible, i isin the interest of ee State to factate a speedy and orderly iuidaton ofthe debtor’ assets and the settlement of ther blgoten (sec. 2 FRA) rage debtors, both and their creditors to ve and adjust competing Nature'of Proceedings under the FRIA The proceedings under this Act shall be in rem. Jurisdiction over all persons affected by the proceedings shall be considered as acquired upon publication of the 208senor RONEN rate ae a mane ey supreme COUF 7 digs shal be conducted 19 2 he proceedings 2 consistent withthe declareg ena rordance with the rules wo ra any wr ret socal atm the apnion of the COU, ther seis ich makes it applicable to “a Fah ae xxx except to the extent that in neato > srt pr splcatin wold te ep esl repose vepecive appa. The wording ofthe lw clay esr hat replicable to all frther proceedings nro eral t be made rtespectvely applicable to the Stay Teessued. bythe —eehabilitation court, (Situs Development Corporation v. Asiatrust Bonk, GR. No 380036, Jonuory 16, 2013) 26 onstruction of Rules ‘The Supreme Cout promulgated the Rules in order provide a remedy for summary and non-adversar! Fehabitation proceedings of distressed but viable Faascus Rewsumanonane insurer Act ar opostion of the case. Rehabilitation proceedings iy axe oy attempt t0 provide for the efficient and eautctn eto to tas fam aig Gn No, 179558, June 11, 2011) * enc, the determination of the me and cone noun die» eer s mpotant im sesang nse conan rb scl eho es tecasr that the redtor be gven te oppor pend oy te rahebtaton ou ence, renin fs, opostion or comment to rebebticton eae sete) Venue of Proceedings All petitions pursuant to these Rules shall be filed in the Regional Trial Court (ATC) which has ursiction ove the principal office ofthe debtor alleged to be insolvent !pectied ints articles of incorporation or partnership or in its registration papers with the Department of Trade and Industry (OT) in cases of sole proprietorship, 36 the cae ‘may be. Where the principal office of the corporation, Dartnership or association as registered in the Securities 8nd Exchange Commission (SEC) isin Metro Manila, the SAN BEDA UNIVERSITY LIBRARYpom Un REO come - Conan Inead office is located. ‘ity cor involuntary rehabilitation involving ° Bro igaiction over the principal off te debtors al to be insolvent, a5 specifieg ates poration oF AFENEShIp, op in its articles OF ty the OT In €8S@S Of ole wet arth yom he wast tha te Cols EADS NE 2 DOME tg soon te en and every three (Gn No. 172883, September 24, 2014) ‘two-pronged Purpose Equitable Purpose — to efclenty and equitably seurbute the remaining assets of the insolvent eblor to ts creditors; and jon must be fed eto rapa wee ee Seen wor oun A peroup of sees 2. Rehabilitative Purpose ~ to provide the debtor nth fresh start by relieving them of the weight of ther outstanding debts and permiting them Franca Reswaunerg insouencract Me sia to. reorganize thelr afas. The rehabiltation proceedings is to PeOs® of company to gan a new ease on we rate, the enpany to gan ea ese on ean there Blow creditors to be pad ther cage’ earings. (PBCom v. Basie Pojpnnse” Packaging Corporation, GR. No. teyint ‘October 20,2016) “7581, vote “debtor that is generally unable to pay its or me RIA) = ae vera property of the insolvent and ofall cameo SSiusive jurisdiction to deal with the proper of fa teen declared insolvent and the insolvency seen fo Sequred contol of his esate, 9 morganee oy nop without the permision ofthe inscheney cour, nts proceedings to enforce its lien. in so doing. mould interfere with the insolvency court's pos a (metropolitan Bank and Trust Cc oP Nga Enterprises, Inc., G.R. No. 178407, March 18, 2s) ft SAN BEDA UNIVERSITY LIGRARFyu vw ee e a0 ney actual the corporation's assets arg ca i ort Hite: a sits inability to nee ‘put it foresees i Be egauth 505 Moy more than One yea, wns Sr 20) re ebior sels seceay exhided bya cto sl ee opt dul reaerg ison oF HERE ASSS Tage and Indestry (OT, feth the DAPEMT red with the Secures ang rtnersi9 ‘a corporation duly organize 5 eis as, oF 30nd debtor i esror dogs. na nude banks, Insurance ct se 7 REHABILITATION itn est operation and soe, aero acon arinuarce of Deaton coon 1 its creditors can recover by wey mksysb = cr co poensgrojected the Bn, Cr rcommuesosa gang concer tans immediatly audatd, (Sec. 49g, FRIA) Fanon RwsuraTON AND INsouncr Act| i organ contemplates Coninanceot ete ea on eon saw amon arch 25, 2015) 7 generate enough cash to sustain daily operations, has a Sf BEDA UNIVERSITY LIGRARF-ea wn REO comet rehabilitation sty corporate . cbse en so maintained than th resus oe able We litatlOn ASSUMES thay een we ren Huda ST eet the PUIBOSES OF the wos en es asta om he sets & ati jlitation receiver to Balancy ines. THe eg oho business, Te erste four anda det continue ordPar Busnes, st t0 Fever ae eres ofits creditors to be ee ear eed oar sera ese etale USES Of cOfporte nd neve arate © ng, ies, 0) erator eS T77882, February ty, pies mone, I al pment 6 sien ing Sr se non nc eg ton i tance ERA any undertakings of Ceoes 3 e etrs ofthe bor ssa ewer earn ens promerty to grantee te aby toms eon the bt" corporation contin Sc spitation. (Philippine Bank of Sag a Oo ed Poti Sonar Caorton, GR. No 187581, Otober 20,2014) Fasc Ressuaren Ano inscensr act a pesofRehobilttion Proceedings 5. cour Supervised a Voluntary Proceedings Voluntary proceedings shall rte to proceedings Initiated bythe debtor. (Sec fr) ray who May Petition When approved by the owner in case of 2 sole proprietorship, oF by a majorty of the partners incase ofa partnership, or in vase oft corporation, by a majority vote of the bosra ey directors oF trustees and authorized by the ve of the stockholders representing at least twee thirds (2/3) of the outstanding capital stock ory ‘case of nonstock corporation, by the vote of ct. least two:thirds (2/3) of the members, in stockholder's or member's meeting duly cea for the purpose, an insolvent debtor may intiate voluntary proceedings under this Act by fing» petition for rehabilitation wth the court and on the grounds hereinafter specially provided (Sec. 12, FRIA) Grounds for Voluntary Rehabilitation 1. One oF more of its members foresee the Impossibility of meeting debts when they respectively fall due; and 2. The financial distress would likely adversely affect the financial condition and/or operations of the other members of the tO SAN BEDA UNIVERSITY LIGRARFai a comer MY ation of the oth pati er aroun oF OUP IS eSSeNtal Under meres ond conditions of the proposeg sees ae nae pea euns0) ewes yal ex ay est gon forthe appointment of avast '. Espina-Caboverde aes ntoro ¥-_E3pIna-Caboverde, rece’ 903585, uy 29, 2013, 702 Scag Gk 5 tor eceverstip 0 BE inorder, Ai. eye clear showing that the tere pertos are in INBEC OF being erate oi pans to preserve, administer oan othe ment ofa receiver where there ae appotitpore adequate legal action against ‘he of ‘where they are solvent, or ot remedies. The appointment of a an for a going corporation Is a last a ec rt epeher remedy is avaiable. Relief by ie ewe ‘exercised if there is an adequate yeed for income hel that to ipenses and Supporti nop vance scr me 25 ‘order. Bad judgment by dir Unouthored wie ana map campos soma te Spoinmen ofa recone the corperstion i. approprate vagy one ctherise be ad foes cath 126464 ure 22006 181 see 1b. Involuntary Proceedings Involuntary proceedings shall refer to proceedings intated by creators. (Sey, Fria) retors, oF even Who Moy Petition Any creditor or group of creditors with a claim of, oF the aggregate of whose claims i at least One Mllion Pesos (21,000. b st_twentv-five per cent (258) ae spserbed capital stock or penne Contributions, whichever is higher, may infece involuntary proceedings under this Rule by fing petition for rehablitation ofa debtor withthe ‘ourt and on the grounds hereinafter specially provided. (Sec. 13, FIA; Sec. 4, Rule 2, ah 12, 12115) Grounds for Involuntary Rehablitation 1. There is no genuine issue of factor law on the claim/s ofthe petiioner/s and tha the due and demandable payments thereon have not been made for atleast sat (60) days; ff SAN BEDA UNIVERSITY LIBRARFron Un REP 26 fled generally £0 meet ig 1h she debtor ‘due; or Hee est citer han th a east Fas initiated foreclose rs proceed rom paving ts dean eo oo wl render it insoheae Be an ates eutetn Sere nes i tn nat of ts creitors aroval of 8 BTE-negotiteg con ln hh ts own rr pe der, ee sec etn poe aims of the debtor ong Tors holding more than fifty percent ole at a i jated 2. present se ec ‘sige tee 75-8) an reneotite Rebabaton after determination dan ecu form and sae tat sue an Orr which shal ey he tr, ill Bie . ‘of activity/ies and its principal place of buses b) decre 2 ‘rehabilitation; Intl order wat (5) workin that the debtor is under @ © Cy o iisengrme ay summarize the ground 75 fOr the fing the petition; ah diet te pbeaton of he newspaper of grec Phe one aceon wo consantve wate wag eee pubaton to be made nian gti Sopsromttetimectsunee Order in a tion in the direct the service by personal delivery of» copy of the petition on each cedtoy wre 's not 2 petitioner holding at lesen percent (20%) ofthe total ais of te debtor, as determined in the schedule attached to the petition, within tee) days: state that copies of the petition andthe Fehabiitation Plan are availa. ee ‘examination and copying by any interested party; state that creditors and other interested arties opposing the petition or Rehabilitation Plan may” fe their objections or comments thereto within 2 period of not later than twenty 20) dave ‘rom the second publication ofthe Order appoint a rehabilitation receiver, if ‘brow forin the Pan; and (i include a Suspension or Stay Order as ‘described in this Act, Sec.77, FIA) iN = é g Q 3feral RetuctNg Arey jotcout of ou ‘ Fert ut formal rest far oa nehataton Pan to au, wero TE ging minimum renurement inst en or must 2748 10 tHE OUT cou a Te eal estuturng/workou, pet or nehabiltation Plan: wet be approved BY eon it least shtvseven (67 gations ofthe debtor be approved bY creditor, vent Te percen LEONG oF the ms reoresenti must representing 2 su) ofthe debror and test be approved by creditors Hoga mast nt (85% ofthe t east subtle pa red and unsecured, of the apie, seu deo. (ec 84 FRA) stn eed rns Pe i the period 2eeed ufo by the grt eae them 0 negotiate ars eto a eter on informal resto) stunt ohn Pan put meat andstill agreement may ee nse es. The sans re lone el wth or simiar tothe lp ree semencement oder nde Section 3, ule2 tins les Be Sf) fle, AM. 1212-250) Framcnt Rowsuranowne insouveney act 28 ie may Be 26rd upon by the partes and sha be ecive and enforceable not ony agains the contaviee jes but oasis the other creo prone ae aw ean coos 1, Approval of the agreement by credkar representing mere than tity percent (Soh the total iablities of the creditor 2, Publication of the notice ofthe agreement in newspaper of general circulation in the Philippines, once a week fortwo (2) consecune weeks; and 43. The standstil period shal! not exceed ene hhundred twenty (120) days from the date of te effectivity. (Se. 2, Rule 4, AM 12-12-11 5¢) commencement Order If the court finds the petition for rehabilitation to be sufint in form and substance, isha within fe) working days from the fling of the petition, Insc’) Commencement Order. If, within the same period, the court finds the petition deficient in form or substance, the ‘court may, in its discretion, gve the pettioner/s not ceaceeding five (5) working days from receipt of notice of the order of the court within which to. amend. or supplement the petition, or to submit such documents a5 may be necessary or proper to put the petition in proper order, in such case, the five (5) working days proved above shall be reckoned from the date ofthe fling of the amended or supplemental petition or the submission of such documents. The court shall dismiss the petition # the a SAN BEDA UNIVERSITY LIBRARFaoe a within the extended five (5.4, acne ea AM 1252415 sees nent rer ene gy the courts. ISSUANCE of pal cetroact to the date of ye connenceest OS) eon tothe ees of fie oe red the Treas Surenon ve et — receiver with al aon it 2 vee ee rane es a te night oF a€C05, and the righe ty et 320 tain records tO which the debtor, reve reat and directors | have access, ome, et wht nce incase subject tothe approval By the cour, tect mance Word DOE by the Sito sev he el bet irate ; > aor a een oo ‘erro activity oF proces 10 seize property, ext aecumbered property, or otherwise attempt ele venforce a claim against the alge ono wc ge commencement Genes cd ates ue, et sso rendering and sree ago fe sere ter the commence te vod an othe debtor by an he Sosrsonitors erent 0Fde" 3 Frew. Roasuraronas Insouencv act a 6. Serve a5 the legal basis for void the perfection of an debtor's property. afer t ate; Fendering nuit ang ny Hen against the al egal e roceedings by and aang the debtor tothe court Prov 7 the debtor tothe court Provided, however het the court may allow te contusion ‘other courts where the debtor had initiated tne suit; and re fmol the debtor tom lab fees, nuting pene, nares thereat due tothe nator! govern ge LGU a5 provided in Section 19 of eae 17, FIA Se. 3,Rule2 Ad 12.2 150 25 and charges Jen of a secured creditor or the value of hi igence ‘fectivty ond Duration ofthe Commencement Order ‘The Commencement Order shal be efective fr the ‘duration of the rehabiltation proceedings, unless (a) ‘ater ited by the court, (b} the rehabiltation plan is ff SAN BEDA UNIVERSITY LIGRARFeanuron vn ie «2 ; eis meses) oe eet CH ay le stay oF Son with the comme! ie nd 3h forcement of IMS ARIAS the mm ct nro iio or sows eve AA preiiel ‘the debtor from sel m mn ‘n any manner any of i wes in the ordinary couse of bus a ween texor from making any payment of its prio te orig. oF the cOMMenceMENE de linbties oust vided herein (Sec. 517, Rule 3, A, 0 2 ae an ng actos, nduding the OC ofthe pend Meegaratin, shuld be spendeg Bh me rehaitation proceedings “eed thatthe suspension “of smth low uno apais ot rt erporaton, paeship eget or receivership, without ocr expenses cured in the rin er paess Malin v. Pace Pls, I, see ger, August 15, 2013, 655 SCRA 356). No Se rot aor dime metioned inte nw tung rid v. Rubberword fod Menggagawa 50 Rubberworld [phis} ine, GR No, 153882, January 29, 2007) or even ent 93 pena tri Fropdence cise orto ces Fed Simeon nde Shsncon, xcept on wiecuenevacr ome m artine dims Meares Novation ¥. CA GA hy matigg, December 10, 2008). 16 acti be take 4 Nae wa ae stately sei et see proceegs of © and at a he per his due the exciton sae ar the te ha la exec. (Gree see 14856 Agu 22097) NPAM® Aries, en 2 crprton ale oe by a eaten sean cers sand on faa tegen sei a gen ortarce by Py ene ees he putes 0 chinw wren co eto Rles On Crore Renta oT een oa Cans, Sana es 2a chorea the Gay nat tr money & cerase he da wguane there ae dco oe orate 859 Oeveloonent Cop 6 ee see 3,200) The actos tat are suspended cover cine peste corporation shee raat at tac of canoe of erage, a ene on txcpton nor of bo dans mentee eee [cation Pipe Aes res Gh Tease a $07 ben the neds renmasney ae woke rng aoe ofthe cves estan ey Sty order Ae held bythe Coure hte recep pining appl as toner the cota ee Eger the srl or evn the eof a ff SAN BEDA UNIVERSITY LIBRARFperiod whet cameron, A EO z ration ite is similar ero ‘empioyer-corporat Wie cece Ten = is fais te sure. e456, tanucry 20,2009) exceptions to S9V 0 sion Order shall ot apply ‘The Stay or Suse ready pending. appeal in the Supr ‘Fo cases ae wr opin subject tothe discretion ofthe court, to cases Senger ed wih a specialized court or aay. et ch apo etermnaton jure th ca more cy coe tan the cour Prod 1 ee ery eet © ch Tot eal ere othe cn es rend enon pte ee entcemet of cis aps ster tos salary tale whe wa Sie pay oF aconmoden st sel ott oer of eat rae erty jee te ted pt cae morgage een fre eoten ote aber 3 Sten’ See pon recmmenaton by rotason ct Fuca: Reset wouter ac 2s To any form of action of customers or chens carious arian se Sheree Same ste ltern thom cane buns os wl tay acun arr srs Ihe prepa othe ssp a tee seep eena ae sSietchdameriaohe To the actions ofa lcensed broker or dealer to sell pledged secures of» debtor purus: securities pledge or margin-agreement for tie settlement of | securies trensactony ie accordance with the provision of the Securing Regulation Code and it implementing rules sad regulations; To the clearing and settlement of fngncal ftansactions through the fois ofa clearing agency of similar entities duly authored registered and/or recognized by the appromate regulatory agency like the BSP and the SEC. a5 well 3s any form of actions of such agencies or entities to. reimburse themeehes for any transactions settled forthe debtor, and To any criminal action aginst indvidval debtor ‘or owner, partner, director or office ofa debtor. ‘The enforcement ofthe cii ably arising fom the offense charged, deemed instituted with the criminal action, shall be covered by the Stay Order. (Sec. 10, Rule2, AM, 12-12-115C) urs entrusted SAN BEDA UNIVERSITY LIGRARFoo La J spam tee ft Se = de ssued by the rehabilitation court does Soe etre does ot extend 10 the claim, ee ies who are solidarily liable with the does ot appr t suet don rtnpn Development CrP. ¥- SECU Bank Corp, ‘GR. No, 190307, lure 6, 2011). imine itty of officers Not Affected ve ehaitaton ofthe corporation It lp spoon eth einton ofits fees cma abit ean enn why crmial proceedings should be Tr ruin corporate rehabiitation, Ore, shee sre ipo of te ciinal action so nih the er gat deter im and other rom commiting on sfroffese, to alate him from society, these enbitate i cr, In general, 0 maintain srerroer would be absurd for one who has engoged ‘retinal const oul escape puishment bythe mere ices peton for reabtavon by the corporation of dines he fan ofcer. The prosecution ofthe officers of The eaporaon as no. bearing on the pending tehabitton ofthe corporation, especialy since they ae Charged in the indal apace. (Pano v ATC, GR Wo 173845, febrary 22011) credit wheourney acs "© me, solecement of Esting Monogerent pon mation of any Interested party a soonest posible time the court may appoint se, feria reaver to asume the pone tre agerent of the debtor, or appoint # monn ‘epee that wil undertke the management er cotfr,uPon clear and convincing evidence of sy ‘Glowing circumstances ry ofthe 1, Addualor imminent danger of di sipation, ls, ‘wastage or destruction of the debtor's ave ‘other properties; or ae debtor; or . ghia) fee annie ae ae ther won condi: on te pat ono or wiful lation of the Act by the ets management of the debtor or the omne partner, director, officer or Tepresenttive/s ky management of the debtor. : In cae the cor app therehabietn eer Peete bleireliedentaal narnia 1. agua the rehbtaon rca pat additional bond; a 2 futharte hi to ene the sre 010 Stare o hs maneerl cto ff SAN BEDA UNIVERSITY LIBRARYcoerce REC cecever ia jridea per te habitation oF che cenaaignated representative shal yg ved out #9 accordance with tne cn by the juridical entity whch in conflict, the decision of she sriical entity shall eval. (Se. 37 Set vee vere Tango ote wna 122850 ened ty the COUR tPOURN tat the i as eer 1s tasked only tO Monitor the cea gf the Tehabitton pln een oncept of corporate rehablitatiy nothing inthe ‘There is nating deprive the Board of Directors ang eases low-Back Principle Ina caw-back suit, the bankruptey trustee or recever wil eek the recovery of initia investments and any raise profits that were pad to investors in order to redistribute these funds to investors that lost the principal on ther Investment (Se. 547, US Bankrupty Code). Fact Rewauranouine esticter & ve Phlpene m8 ces cng taste co ew es ‘Sat serene pee or as fecty bene ater ‘commencement date which are not in the sean ih sate Dns of he deer nse mtr opery my bee rb apts Sapo oa a 1eorantice henry pe ‘ehobiltation Receiver, Rehabilitation receiver shall refer to the person or persons, natural or juridical, appointed as such by tne fourt pursuant to the Act and which shal be entrlted with such powers, duties, and responsibiities asset forth herein. Where the rehabilitation receiver is 2 juridical entity, the term includes the juridical eniy’s designated representative. (Sec. 5(p), Rule 1, AM, 1212-115¢) Any qualified natural or juridical person may serve as a rehabilitation receiver. A cehabiitation receive who is 3 Juridical entity must designate, a6 its represenatve, a ‘natural person who possesses ‘ll the qualifications and none ofthe disqualifications under this Rule, The jurdal ey andthe representative ae slider lable forall he obligations and responsibilities ofa rehabilitation receiver. (Sec 20, Rule 2, A.M, 12-22-21-5¢) @ r SAN BEDA UNIVERSITY LIB,camer 0 RE 20 a receiver should not though that 2 12 te wns ld ay who POSSESSION fhe appointed 1° Fant as. 3 wit Of liminary Spey WN Sy to wales propery possession a5 Gear ese aboverte, 6 uotieation. There must comply and requirements session of ne Party tO another pate and te Pa hong pin heel exept In a very sere usrption (EMO ¥. Ean. tee as ly 2, 203,702 SCR Soy of ehabiitetion Receiver sever who Is @ natural person bitaton re elicn the following minimum qualification, ea cizen ofthe Philippines OF 2 resident of te appines for at last sc (6) months rpediately preceding his nomination; es of good moral character. and with MSinowedged integrity, impartiality and independence; ‘as far as practicable, he has expertise and cumen to manage and operate 2 business Sinior in size and compleity to that of the ebtor, He has an operating knowledge in management, finance and. rebabilitation of alstressed companies He has a general familiarity with the rights of creditors subject to suspension of payments or Fehabltaton and a general understanding of weowreracr a the duties and obligations of a 1 recelver, habitation He tas ot been ater donsed a 2 rehabiltationreceherpursan tose this Rule; “ena of He has no confict of interest a defined in Rule; and = He Is willing and able to file» bond in sueh amount as may be determined by the coun (Sec, 21, Rule 2, AM, 12-1211 50) ‘the rehablitation receWver, which i ‘9 jriieat person, must comply withthe following quaifistons a feauirements ft Is duly authorized t0 do business in the Philippines for atleast six (6) years prior to ts appointment; It is of good standing as certified by the appropriate regulatory agencies, Ie has no conflict of interest as defined inthis Rule; It has not been earlier dismissed as 3 rehabiltation receiver pursuant to Section 27 of this Rule It must submit the name of the person designated to discharge the responsblties and powers of a rehabiltation receiver and the names of the employees and other persons authorized to assist the designated representative, together with = swam f SAN BEDA UNIVERSITY LIBRARY22 we Race rion that these ETSONE possess certiea a ‘and none of the discaliicagont a rors ate whe itis wiling and able to Mle a bond in such vrourt as may be determined by the court eis not disqualified to discharge the duties of Tenbiitation receiver under the Constitution, via other relevant laws. (Sec. 21, Rule 2, Ang ye2-rsC) ~ In addition, the designated representative of the juetieal person must comply with the folowing requirements ‘The representative must be duly designates and authorized to act for and on behalf of the jraial entity, 2. The designated representative must be 2 rector, officer, stockholder or partner of ‘the jundical entity: and 3. The designated representative must submit 2 swotn undertaking that he shall be Solidariy Hable with his frm forall the Obligations and responsibilities of a fehabitation receiver. (Sec. 21, Rule 2, AM. 122-1150) 4 a? Frac: Risen heute ac mm rowers, Dues ond Functions of Rehabittation Ree, ‘he cesbiltstion eer sal be ot cot wh he Ba ty at ene imizing the value ofthe assets of the deme 3M a ofthe deter en Saito proceedings, Seteminng ne ee {Gatton ofthe deter, repormge ant te Snenabiltation Plan to the cour, and impasse ‘proved Redan ln Toes organ teng te gerraty ofthe forego ek rece shall have the following powers acest” responsbilties eee 2 Tovey the acuray ofthe at lle in the petition and its annexes; paar b, To verity and correct, if ne + if necessary, the inventory of all of the assets of the debtor ano that valuation; To wey and correc it pcs, the of debts and bites ofthe cebag ee 4. To evaluate the valid, genuineness and ty amount ofall the claims against the debtor, To take possesion, cst ar contr, od vo preserve the value of al ie pope o be debtor; aa f. To sue and recover, with the approval of the court, all amounts owed to, and all properties pertaining tothe debtor 8 To have access to all Information necessary, Proper or relevant to the operations and business ofthe debtor and forts rehabitation, SAN BEDA UNIVERSITY LIBRARYsti mu onmeen La REC 4 rcv, wth i ABO hy su gd meer macy ote dor pat coun, a ears aud of the de © fener rere th operate andthe ses re sure that 0 payments aur to eae e esters of property are made other than in the orbs To sue ont ordinary cours ‘yath the courts approval, to engage the services Myer to employ persons or entities to asist him Inthe discharge of his functions: ro determine the manner by which the debtor Tray be best rehabiltated, to review, revise jor recommend action on the Rehabilttien an and submit the same oF a NeW One to the courtfor approval; To. implement the Rehabiltation Plan as sppcoved by the court, If 50 provided under the fchabitation Plan; To. assume and exercise the powers of management of the debtor, if directed by the Court pursuant to Section 36 hereof; ‘To exercise such other powers as may, from time tortime, be confered upon him by the cout; and To submit a status report on the rehabilitation proceedings every quater or as may be required bythe court motu proprio or upon motion of any ~ Fron. Rosmuranovany wrnev Ac 25 wa Paa See Management Committee Management committee is composed of ratural oF Juridical, appointed by the cure, the ales. shall take the place of the mar gpvering body of the debtor, and assume Sans and responsibilities under the law. Ys TAM 12-12-11-5C) Unless the court otherwise provides, them: the management committee appointed pursuant to Se. 31 of tis ley pmposed of three (3) qualified membr be compe appoint the cour, a follows: eee f persons, Pursuant to ment and thee powers, St), Rule 2. The fst member shall be nominated inate by te debtor; in case the debtor fails, the Cour sa Sopoin the fst meters b, The second member shall be nominated bythe creditors holding more than ity per ent Son) of the total obligations of the debtor, incase tn, creditors fal, the court shal appoint the secon member; and The third member, who shall act as chairman of the management committe, shal be nominated by the first and second members within ten (10) ays. from the appointment, In case of disagreement between the frst and second ‘members, or fllure to nominate, the cour shal appoint the thd member, SAN BEDA UNIVERSITY LIBRARFcomms REO 26 ase eo section 31) ("088 misma, : ree to posta bond; commit uthoree the management committee yp ox engage the sees Of £0 eMpoy oy ere persons oF enties £0 35ST in the ffs duties and functions, pursuant tg b decharae eeeyan 37 of this Rule on the employment oy reo professionals; and «authori the sting ofthe COMPENSAtiON ofthe ampere of the management committee, evant to section 28 ofthis Rule, (Sec. 34 ue DAM 1242110) bers shall be necessary forthe iy of all . et or make a decision (ee management committee 10 a 135 Rule2, AM, 2-12-1156) ‘avoifictions of Members of the Management Commitee ‘the members of the management committee shall have the, same qualifications and none of the tisqulfications as those prescribed for the rehabilitation fecvivee by this Rue, In case a member of the ‘management committee i juridical person, the relevant prowsions governing juridical persons as rehabiittion receivers shal apply. (Sec. 36, Rule 2, AM. 12-12-11-5C) cae Franc Rowse ranoe Insourney Act an a ea coos ane em sume thelr Powers, TeM and response, me immunity from Suit retaitton Pon Aehaitaton Plan sl cfr ln by whch he financial welibeng and vib fn nse no berestred wing varus mean nc basen ©, de Forgery, det rescheduling ope fimiecrgaiiton, acon "en foe fen Conversion and sale ofthe business fr Po te faeg concern, or setup ef new bane tn Prescribe in Seton 62 here, or ae ones Drargements ap may be approved by tee of cree.) ml) 31 ofthis Rue "BOWE to take SAN BEDA UNIVERSITY LIBRARY

I ' : uo he Seems 4p Moeroainn 6 mn ie not sufcent to cover his liabilities, and owing debts exceeding Five hundred thousand pesos {500,000.00}, may apply to be discharged from his debts and Fabilties by fling 2 verifies petition wit the court af the province or cy in ‘which he has reside for six (6) months prior the fling of such petition. He shal attach to his petition a schedule of debts and liabilities and an Inventory of assets. The filing of such petition Shall be an act of insolvency. Sec. 103, FRI) tnsourcr cr 25 ¢_ Involuntary Liquidation Any creltor oF group ofcedtors wih 3 claim ofr with cas aggregating at leas tae hundred thousand pesos (#5000000) ey ne 2 verfled petition fr liauistion withthe on of the province oF city in which the naiadc debtor resides. The petition for igutton ay for or allege atleast one ot ct foro all one ofthe consere acs of nsolveney Se. 105, FRA) . ‘The petitioning creitor/s shal post 3 bond in such sum asthe cour shal ere, condone that ifthe petition fr lauiation i dsmissee oy the court, or witherawm by the pettaner orf the debtor shall not be declared an nshens, the petitioners will pay tothe debtor a cons, expenses, damages "occasioned bythe proceedings, and attorney’ fees. Sec. 105 Fi) ‘Acts of Insolvency The following shall be considered acts of Insobency “That such person is about to depart or has departed from the Republe of the Philippines, with intent to detaud his creditors i That being absent from the Republic ofthe Philippines, with intent to defaud his rectors, he remains abeent li, That he conceals himself to avoid the service of legal process forthe purpose of RARY SILY LIB, SAN BEDA UNIVE!— 258 10 delaying the liquidation oy gy rindrng or deloving defrauding his fee eae See eee are a aoa Farell prin oto That he has suffered oF procured his property to be taken on legal process with Intent to give a preference to one or more cf his creditors and thereby hinder or ely the liquidation or defraud any one of his creditors; That he has made any assignment, gt, sl conveyance or transfer of ‘his estate, property, rights or credits with intent to hinder or delay the liquidation or defraud hiscreditrs; [crc Frmcat Rewaemnenine Tesoro 2 That he has, in contemplation of ingo made any payment, git, a wan, le, Conveyance watt iy Se ‘property, rights or credits; z ‘That being a merchant ot generally defauted in the current obligations for 9 (30) coy, That fr a petios fh as, bh fale, ster demand o py ot Geposted wth him or ecened yan Fairy cape and desman, he has Payment of hs Petiod of thirty That an execution having. been igued against him on final judgment for money, he shall have been found to be witnoy sufficient property subject to execution to satisy the judgment. Se. 105, tia) Uguidotion Order the individual debtor shal defaut or, after tral, the issues are found in favor ofthe petitioning crestor, ‘the court shal issue the Liquidation Order. (Se. 107, FIA) ‘The Liuidation Order shal a. Declare the debtor insolvent: . Order the liquidation of the debtor and, in the ‘ase of ajuricical debtor, declare it as dissolved Order the sherif to take possession and contro! ofall the property of the debtor, except those that may be exempt from execution; MARY /ERSITY LBs SAIN BEDA UNIVi | ' | } camencn Ut RECAP keaton ofthe Betton oF mation fof general culation Ong® cutive weeks; oe tanec Be a oct te Uso ad fro paryerpery the debtor, ns a Ain ecb cn ‘publication. (Sec. 112, FRIA) ets of tauidation Order ‘Upon the issuance of the Liquidation Order: ‘The juridical debtor shall be deemed dlssohed ‘and its corporate of juridical existence terminated: b. Legal le to and control of all the assets ofthe debtor, except those that may be exempt from execution, shall be deemed vested in the Beouteeracr 20 liquidator or, pending his appointment, withthe court; “etan or eA contacts ofthe debtor a terminated aor ‘reser ot lguidaor, within ninety (9) das tome he of his assumption of ofe, decane and the contracting party agrees, IE 4. No separate action for the clacton of unsecured claim shall be allowed. Such act) mo already pending wil be trarstones att LUquidator for him to accept and secu contest. Ifthe liquidator contests or disputes ye oF dues he him the court shal slows hes ete Such contest except when the ene ees appeal In sucha case the suk may aoe Judarent, and ay tinal and executor ay therein for» claim against the weber sen nt fled and allowed in court and all be deemed fe No foreclosure proceeding shall be allowed fora Period of one hundred eighty (260) dae see 113, FIA) Aights of Secured Creditors ‘The Liquidation Order shall not affect the right of @ secured creditor to enforce his lien in accordance wth the applicable contractor law, unless he waives his rah. (See “4 Rule 4, A.M. 15-04-06-5C) a © SAN BEDA UNIVERSITY LIBKARYa coer AW REAP 20 secred Creditor aoe ie te ec08 fe Hit, sec er sak mates 19 WARNE TTB oye sinether hes se ste wed IR SEUY OF Hany Waving 8 fein 6 is ule or b_Maitaiainghis ght under the Security ole, falls to file such a manifesta Ha secured creditor fis tof a he shal be deemed to have opted tO maintain his righ, reset security or lin. (ec. 5, Rule 4, AM. 15-06 06, so) Wier Sey ren secre eedtor sal 8 BE deemed £0 hae waived he ener the sect of en unless the “Shor Eimute maple dunt ue atc snd th tat Knowledge ofthe consequences rete aecred cretor waves Ns gt Re shale ist porate nthe hgidaton proceedings ap Seared cata e 6 les AM 1508-0650) ‘Mointoining Securty or tien Ifthe secured creditor maintains his rights under the security orien ‘The value of the property may be fixed in manner agreed upon by the creditor and the liquidator. Whea the value ofthe property sess than the claim i secures, the liquidator may convey the property to the secured creditor and FraensRestmox ine these act a the latter will be admits proceedings a8 9 creditor forthe value exceeds the cm secured the tenet may convey the property to the crednor sey walve the debtor's right of redenpne on receiving the excess from the redion PO" In the lauidstion The luidator may sl he prope the secured cedtors ene dams pana proceeds ofthe sale; or dill! The secured credtor may efor the ten foreclose on the property pursuant to applicat i laws. (Sec. 7, Rule 4, A.M, 15-4-06-5c) rele Liquidator ‘The liquidator shall have the qualifications as the rehabilitation receiver. He may be removed at any tine by the court for cause, either motu propo or upon Notne ot any creditor entitled to vote for the eleton of he liquidator. (Se. 118, FRA) ‘A liquidator shall be subject to removal pursuant to procedures for removing a rehabitation receiver, ce 119, Fa) Power, Duties, and Responsibilities ofthe Liquidator The lauidator shal be deemed an officer ofthe court with the principal duly of preserving and maximiing the value and recovering the assets of the debtor, with the tnd of luidating them and aschargng to the extent Dossble al the claims agains the debtor, i? SAIN BHDA UNIVERSITY LIGKARYsa a RECAP me sen ee han a ee creditors and stock cee ote ir El eHSTENE e379 fra) eterinaion of Cans jighin. twenty (20) days from his assumption ints Fens Rosonraron se Isouener At Ey sa share} OF MEMS ofthe copra Sher eresed parties ay submas a Zam or claims tothe cour, serving acertieg copy on th sjaator and the creditor holding the chatenged at ne exoation of the thiny (tpaay ec eaten rece sal sma the reniary of claims containing the undisputed came tne (eee bee sujet 0 chlenge aan cam atl upon he fling of he reac ca Ppeeauently set aside only on grounds or fave seneeee Sistake or inexcusable neglect. (Sec. 125, Faia) tiation Plan Wiio thre (3) months from hs ssumpton into ates, the uiatr shal submit a Lgudaon ees ut The Uguidaton Plan stall ar miner ‘enumerate: . 2. All the assets ofthe debtor not exempt om 2 Alistof al eredtors and their cams whch ave been dul proved 8 shown in the fal ep of claims; and al &Aproposed mote and schedule ofan of the assets and payment of the cis ‘The Liquidation Plan shall make provisions fo, among ‘others, disputed claims and any action for resision of 2g SAIN BEDA UNIVERSITY Lin,cnn a RECA a mans BILAN Pe oases nv Igudator andthe cout shall ensure that the manner of wae ansfer or dsposton is Inthe best interest of the debtor and his erectors. (Se. 25, Rule 4, AM. 15-04-06. SO Final Report of tquidtor ‘When allthe property ofthe debtor not exempt from ‘eecution have been realized and their proceeds Gstnbuted to the creditors In accordance with the Liquidation Pan, the liquidator shall submit his fina eport to the court, together with the final accounting of his administration and @ recommendation forthe termination Fun, Rosanne insu on 28s roceedines, furnishing al th ofthe P 8 all the creditors and oth of srested partes with Copies thereof 050 (Sec, 28 Rule 4, fe pereee Mp erecting the removal of the name of the marae ee ff SAN BEUA UNIVERSITY LIBKAKY