Borrower beware: in times of distress, your credit documents may give your secured lenders an opportunity to “flip” control of your board
Distress happens, even at companies that once appeared financially solid. When it does, the company, its board (which may be controlled by a sponsor in a public or private equity scenario), and its lenders often enter into restructuring discussions in search of a consensual path forward, typically under the terms of a forbearance agreement.
Introduction
As cross-border restructurings proliferate, especially in the wake of the global COVID-19 pandemic, companies with global assets and operations may utilize chapter 15 of the U.S. Bankruptcy Code (the “Bankruptcy Code”) to facilitate cooperation between U.S. and foreign bankruptcy courts and protect assets located in the U.S. One doctrine central to relief under chapter 15 is the principle of comity, which refers to the recognition one nation’s legal system accords to another nation’s judicial proceedings. In chapter 15 proceedings, U.S.
The holidays came early for the United States Trustee (the “U.S. Trustee”) on November, 3, 2020, when a three-judge panel of the United States Circuit Court for the Fifth Circuit, on direct appeal, reversed the bankruptcy court and upheld the constitutionality of a 2017 increase to quarterly fees payable to the U.S. Trustee in Hobbs v. Buffets LLC (In re Buffets LLC), No. 19-50765, 2020 U.S. App. LEXIS 34866 (5th Cir. Nov. 3, 2020). Although the Fifth Circuit’s opinion addresses a variety of constitutional challenges to the recent increase to U.S.
In In re Nine West Holdings, Inc., the United States Bankruptcy Court for the Southern District of New York overruled the U.S.
On August 3, 2016, Delaware Trust Company, as trustee for the EFIH first lien notes, filed a petition for certiorari with the United States Supreme Court, asking the Court to review the Energy Future Holding debtors’ settlement with the EFIH first lien noteholders.
An involuntary petition under chapter 7 of the Bankruptcy Code filed against a Mississippi casino developer was dismissed for bad faith, even though the petitioning creditors met the statutory requirements for filing the involuntary case. In In re Diamondhead Casino Corporation, the U.S.
Funds passing through a correspondent bank account in New York can create personal jurisdiction over the funds’ recipient, ruled the United States District Court for the Southern District of New York. In Official Committee of Unsecured Creditors of Arcapita Bank B.S.C. v.
Claims estimation can be an important tool for a chapter 11 debtor, particularly to pave the way for proposing a chapter 11 plan. How a bankruptcy court estimates wrongful death and personal injury tort claims (which have a jury trial right) is an interesting issue that was recently discussed by the Bankruptcy Court for the Central District of California in In re North American Health Care, Inc.
Yesterday’s post discussed the recent appellate ruling in Sentinel’s bankruptcy, Grede v. Bank of New York Mellon Corp.