Classes of affected parties

Since the ordinance of 15 September 2021, classes of affected parties group the creditors and shareholders whose rights a draft safeguard plan modifies. Article L. 626-30 of the French Commercial Code defines as affected parties the creditors whose rights are directly affected and the equity holders whose shareholding, articles of association or rights change. The judicial administrator divides them into classes that represent a sufficient community of economic interest, according to verifiable objective criteria. Creditors holding security over assets (sûretés réelles) form separate classes for their secured claims. The division respects the subordination agreements concluded before the opening. Shareholders form one or more classes. Classes are mandatory from 250 employees and €20m of net revenue, or from €40m of net revenue (article R. 626-52). Below these thresholds, the supervising judge (juge-commissaire) authorises classes at the debtor’s request (article L. 626-29). Each class votes by a two-thirds majority of the votes cast (article L. 626-30-2). When a class votes against, the court has the power to impose the plan through a cross-class cram-down under the conditions of article L. 626-32. These conditions include the absolute priority rule between ranks. In 2024, the three Atos classes (two classes of unsecured financial claims and one class of shareholders) approved the plan with 100%, 97.64% and 75.03% of the votes cast. For a borrower, the division determines who votes with whom: a unitranche lender holding security and a subordinated mezzanine lender fall into different classes.

A mid-sized company with 600 employees and €150m of revenue enters safeguard. The administrator forms four classes: secured senior lenders (€110m), unsecured Euro PP holders (€40m), the subordinated mezzanine lender (€25m) and shareholders. The senior lenders vote 85% in favour and the Euro PP class votes 55% against. The court then examines a cross-class cram-down.

• The thresholds: 250 employees and €20m of revenue, or €40m of revenue (article R. 626-52).
• The separation of claims secured by security over assets from other claims.
• Respect for the subordination agreements and the intercreditor agreement concluded before the opening.
• The best interests test for dissenting creditors (article L. 626-31, 4°).
• The conditions for a cross-class cram-down (article L. 626-32).