1E9Ct5D

plan. An amicable settlement must be well balanced and must treat all creditorsequally. If the debtor does not follow these principles, creditors may withdraw fromthe settlement. 62 b. FranceUnder French Law, the validity of a settlement agreement entered into with adistressed company will depend on whether the company is already under theprotection of an insolvency proceeding. As mentioned in Paragraph III. A. 7. b.,supra, the period between the date on which the insolvency occurred (InsolvencyDate) and the date of the judgment opening the insolvency proceeding is referred toas the “période suspecte.” Certain transactions made during such period are voidper se. 63These transactions include:• Granting a mortgage,• Paying debts that are not yet due and payable,• Paying due and payable debts by abnormal means of payment,• Entering into a significantly unbalanced contract.Although settlement agreements are usually permitted, some French Courts haveruled that a settlement agreement was void per se in case it was significantlyunbalanced. 64Some transactions are not void per se, but may be voided at the Court’s discretion, if(i) the transaction occurred after the date of insolvency, and (ii) the creditor wasaware that the debtor was not making payments to creditors as they came due.Under French case law, the Court would void the transaction only if the creditor had62 Bundesgerichtshof [BGH] [Federal Court of Justice] Dec. 12, 1991, IX ZR 178/91.63 Code de commerce [C. com.] art. L. 632-1.64 Cour de cassation [Cass.] [supreme Court for judicial matters] com., July 26, 2001.50