A Not-so-independent Independent Director in a Bankruptcy Remote Structure
A Not-so-independent Independent Director in a Bankruptcy Remote Structure
..corporate formalities can be overlooked if there is a legitimate ability or reason to reorganize the debtor.
Footnotes
1An "independent director" is a director who is not at the time of initial appointment and has not been at any time during the preceding five years: (a) a stockholder, director, officer, employee or partner of the borrower, general partner or affiliate of any of them; (b) a customer, supplier or other person who derives more than 10 percent of its purchases or revenues from its activities with the borrower, general partner or affiliate of any of them; (c) a person or other entity controlling or under common control with any such stockholder, partner, customer, supplier or other person; or (d) a member of the immediate family of any such stockholder, director, officer, employee, partner, customer, supplier or other person. The term "control" means the possession, directly or indirectly, of the power to direct or cause the direction of management policies or activities of a person or entity, whether through ownership of voting securities, by contract or otherwise. Return to Text