Document background
The Debtor In Possession Loan Agreement is a critical financing tool in Dutch restructuring scenarios, used when a company in bankruptcy proceedings requires new funding to continue operations or implement a restructuring plan. This document type emerged from the need to provide companies with access to financing during insolvency proceedings while offering adequate protection to lenders. Under Dutch law, such financing requires careful structuring to ensure compatibility with the Faillissementswet and often requires court approval. The agreement typically includes provisions for super-priority status, detailed collateral arrangements, strict monitoring requirements, and specific milestones related to the restructuring process. It's particularly relevant in situations where there's a viable business that needs working capital during the restructuring period, and the agreement must balance the interests of new lenders, existing creditors, and the company's restructuring goals.
