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Australia: Big trouble in small business restructuring

In brief

Australia, Capital Markets, Insolvency & Restructuring, Baker McKenzie
Australia: New Small Business Insolvency Reforms - How Statutory Demands will change from 1 January 2021

 

In brief

The new small business insolvency reforms enacted by the Corporations Amendment (Corporate Insolvency Reforms) Act 2020 (Cth) (Corporations Amendment Act) - which inserts a new Part 5.3B into the Corporations Act 2001 (Cth) (Corporations Act) - are due to come into effect on 1 January 2021.

Australia, Capital Markets, Insolvency & Restructuring, Baker McKenzie, Coronavirus
SDNY Bankruptcy Court allows as a claim unamortized original issue discount generated in a fair market value exchange

The Bankruptcy Court for the Southern District of New York overseeing the Residential Capital (“ResCap”) cases issued an opinion on November 15, 2013 (the “Opinion”)2 allowing the unamortized interest associated with original issue discount (“OID”) that was generated in a fair market value exchange and claimed by ResCap’s junior secured noteholders (the “Holders”). While the OID ruling is only one component of the Opinion,3 it may have far reaching implications, as already evidenced in the pricing of other OID notes that were the product of fair market value exchanges.

USA, New York, Insolvency & Restructuring, Litigation, Dechert LLP, Bankruptcy, Interest, Fair market value, Second Circuit, United States bankruptcy court, US District Court for the Southern District of New York
The Delaware Bankruptcy Court confirms that lenders in multiple-level financing structures are entitled to the protections of corporate separateness

The Delaware Bankruptcy Court has confirmed that in multiple-debtor chapter 11 cases, the cramdown rules set forth in section 1129(a)(10) of the Bankruptcy Code must be applied on a per debtor basis as opposed to a per plan basis. See In re JER/Jameson Mezz Borrower II, LLC, No. 11-13338 (MFW), 2011 WL 6749058 (Bankr. D. Del. Dec. 22, 2011) (“Jameson”) and In re Tribune Co., No. 08-13141 (KJC), 2011 WL 5142420 (Bankr. D. Del. Oct. 31, 2011) (“Tribune”).

USA, Delaware, Insolvency & Restructuring, Litigation, Dechert LLP, Bankruptcy, Debtor, Title 11 of the US Code, United States bankruptcy court