Summary
The FDIC receiverships of Silicon Valley Bank and Signature Bank have caused certain early-stage companies to face potentially crippling near-term liquidity issues. These liquidity issues may result in a company becoming insolvent. Therefore, boards of directors of such companies need to consider their fiduciary duties as well as steps that can be taken to mitigate risks.
Fiduciary duties are typically owed to the company for the benefit of its owners.
On August 29, 2022, in the PG&E bankruptcy matter, the Court of Appeals for the Ninth Circuit became the first circuit-level court to address the question of what is the correct rate of interest to be applied to unimpaired unsecured claims against a fully solvent debtor.[2] In its decision, the Ninth Circuit reversed the bankruptcy court’s and district court’s rulings and held that such creditors are entitled to receive postpe
This ThinkHouse TUPE Club Q&A deals with our Top 10 questions on:
- the key employment issues in Administrations and Liquidations; and
- how TUPE applies when there is an insolvency situation.
Q1. What is the effect of insolvency on contracts of employment?
There are various types of insolvency proceedings and these are designed to achieve various different end results. The different types of insolvency also have different consequences for the entity and employees.
Administration