Many businesses recognized significant net operating losses or “NOLs” as a result of the COVID-19 pandemic. The Internal Revenue Code of 1986, as amended (the “Code”), generally allows many types of taxpayers (including individuals, estates and trusts, exempt organizations, and most C corporations) to utilize NOLs to offset taxable income in other tax years, subject to certain limitations.

As we previously reported, the CARES Act temporarily expanded the number of small businesses eligible for relief under the

The Small Business Reorganization Act of 2019 (“SBRA”) took effect in February 2020. The SBRA gives small businesses new forms of bankruptcy relief that were not previously available to them under federal law, including the ability for business owners to retain ownership of their businesses without first paying their creditors in full.

The United States Congress revived the age-old tradition of passing a lame-duck Christmas Tree appropriations bill to fund the government and provide a second wave of much-needed COVID-19 relief legislation.[1] The nearly 5,600-page bill, which President Trump signed into law on December 27, 2020, inclu

Paycheck Protection Program Loans Under the CARES Act

The Paycheck Protection Program (“PPP”), adopted as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which passed Congress on March 27, 2020 and was signed by President Trump the following day, provides forgivable loans guaranteed by the government to certain employers, with forgiveness of the loans dependent upon maintaining certain employment levels for the six months following the loan. A second PPP round was authorized in late April and is currently in process.

The COVID-19 pandemic has caused economic turmoil that may provide opportunities for financially secure companies with capital to make a strategic acquisition of distressed assets and for investors to acquire valuable assets. The following highlights some important considerations when evaluating a purchase of distressed assets.^[1]

How to Finance the Purchase of Distressed Assets

Both commercial landlords and tenants continue to struggle from governmental lockdowns and financial pressures. Recent bankruptcy decisions have added an additional layer of financial distress on commercial landlords by: (i) reducing commercial tenants' rent based on the subject lease's force majeure provision and governmental pandemic orders and (2) ignoring commercial tenants' requirement of timely payment of post-bankruptcy rent and allowing commercial tenants to "pause" payment of rent consistent with the governmental “stay” orders issued because of the COVID-19 pandemic.

The United States Congress revived the age-old tradition of passing a lame-duck Christmas Tree appropriations bill to fund the government and provide a second wave of much-needed COVID-19 relief legislation.[1] The nearly 5,600-page bill includes temporary alterations to the Bankruptcy Code to help thos

It may seem counterintuitive for banks and other lenders to provide loans to companies in bankruptcy, but they often do. All companies, especially those in bankruptcy, need liquidity to continue operating. Ensuring the availability of cash is one of the most important considerations in a Chapter 11 reorganization because debtors are often unable to reorganize without adequate cash flow.

As lenders prepare for a world with an increased risk of borrower failures, liquidations, and bankruptcies, many have begun focusing on requiring that borrowers form special purpose entities (“SPEs”) to mitigate against those risks. In this publication, we explore how recent case law has viewed the formation and use of SPEs and which structures have been more effective than others.

Current State of the Law Regarding Bankruptcy Remote Entities