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Also, directors may be held personally liable for the debts of the company if theyallow it to continue to trade in circumstances when they knew or ought to haveconcluded that there was no reasonable prospect of avoiding insolvency.B. Doing business with a troubled company – German andFrench perspectives1. Settlement agreement with an insolvent companya. GermanyUnder German law an amicable settlement other than a formal insolvency plan (seeParagraph III. A. 11, supra) requires the consent of each of the creditors. Suchsettlement is not binding on any creditor that is not a party to the settlementagreement. 60Furthermore, in the event of the opening of a subsequent formalinsolvency proceeding, the stipulations of the settlement agreement and theirexecution may be subject to insolvency challenge rights (see Paragraph III. A. 7. a.,supra). 61Therefore, an insolvency plan is often the preferable rehabilitationinstrument for the creditor.Compared to the formal insolvency plan, another important disadvantage of anamicable settlement is the high risk of personal liability of officers and shareholdersin case of failure of the settlement (see Paragraph III. A. 15., supra, and ParagraphIII. C., infra). Thus, debtors who act responsibly in times of crisis presumably wouldrefuse an amicable settlement.However, an amicable settlement does not require entering into a formal insolvencyproceeding, which may represent a major advantage compared to an insolvency60 Bundesgerichtshof [BGH] [Federal Court of Justice] Apr. 28, 2006, 3 U 134/05.61 Insolvenzordnung [InsO] [Insolvency Statute], Oct. 5, 1994 [Bundesgesetzblatt] (BGBl.] 2866, aslast amended by Art. 6 G of the Act of August 31, 2013 [BGBl.] 3533, §§ 129 ff.49