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Bankruptcy Econcern: put option claim denied


A contractual obligation of the company to repurchase (certificates of) own shares in its own share capital based on a put option agreement cannot be enforced, if the company – at the time the option is invoked – does not have the (mandatorily) required free reserves. This is determined in December 2012 by the Utrecht District Court in a claim validation proceeding regarding Econcern N.V., the energy company that was declared bankrupt. The contract party claimed – instead of the agreed put option exercise price – an (equivalent) amount of damages because of a default under the put-option agreement, which claim was denied.