Article 262 of Bankruptcy Law

If a judgment declaring the company bankrupt is issued, the Bankruptcy Court may, upon the request of the bankruptcy judge, the trustee, the Bankruptcy Committee, or a creditor, order the members of the board of directors or the managers, or those conducting liquidation in liquidation proceedings conducted outside the framework of this Law, to pay an amount proportionate to the fault attributed to the person concerned. The amount shall be used to cover the company’s debts if it is established that any of them committed any of the following acts during the two years preceding the company’s cessation of payment: 1. Using commercial methods whose risks have not been studied, such as disposing of goods at prices below their market value in order to obtain funds with the intention of avoiding bankruptcy proceedings or delaying their commencement. 2. Entering into transactions with a third party to dispose of assets without consideration or for inadequate consideration and without a certain benefit or one proportionate to the company’s assets. . Paying debts of any creditors with the intention of harming other creditors. . If it becomes apparent after the company’s bankruptcy that its assets are insufficient to pay at least 20% of its debts, where it is established that they were negligent in managing the company in a manner that led to deterioration of its financial position. The court shall not issue its judgment stipulated in this Article if the person to whom the acts specified in this Article are attributed proves that he took all precautionary measures that an ordinary person could take to reduce potential losses to the company’s assets and its creditors. The action specified in this Article shall be brought within two years from the date of issuance of the judgment declaring the company bankrupt; otherwise, the right to bring it shall lapse. Any person who proves his written reservation concerning the acts stipulated in this Article shall be exempt from liability for them. Chapter Three Indebtedness of Small and Medium Enterprises