The Singapore High Court recently issued the first-ever super-priority order for debts arising from rescue financing under Section 211E(1)(b) of the amended insolvency laws in the Companies Act. The decision shows that the court is open to adopting relatively unique deal structures, and could be a benefit for more business-centric solutions.

In Part 1, we discussed how, despite widespread usage, termination in the event of bankruptcy clauses (“ipso facto” clauses) are generally unenforceable pursuant to the bankruptcy code. In this second part, we discuss why these clauses are still prevalent in commercial transactions and the exceptions that allow for enforceability in certain situations.

Why Do Ipso Facto Clauses Remain in Most Contracts?

If ipso facto clauses are generally not enforceable, then why do practically all commercial agreements continue to include them? There are several reasons.

Practically all commercial transactions, including licenses, services agreements, and supply agreements, contain a provision that triggers termination rights, without notice, to a party whenever the other party files for bankruptcy or experiences other insolvency-related event. In Part 1 of a two-part series, we discuss how the commonly used termination-on-insolvency clauses are generally unenforceable despite their widespread use.

Standard Ipso Facto Provision

In retail bankruptcies, it is important for suppliers consigning goods to merchants to be aware of the commercial law rules governing consignments. Disputes among consignors, inventory lenders, and bankruptcy debtors have been arising frequently in retail bankruptcy cases. Disputes like these can be avoided if consignors consider the basics of commercial law rules governing consignments, particularly under the Uniform Commercial Code, and take steps to protect their rights and interests.

Many tax-exempt organizations can now change their state of organization and retain their current tax exemption.

Investors currently relying on certain of the Bankruptcy Code's safe harbor provisions to save them from clawback claims should consider finding new shelter. The U.S. Supreme Court in Merit Management Group, LP v.

Two key changes made to Australian insolvency law enhance restructuring efforts in Australia and could improve outcomes for US investors.

The court awarded OpCo Noteholders in excess of $320 million in Make-Whole Amount and post-petition interest, confirming that make-whole is an enforceable liquidated damage claim.

Twenty years of straight-line growth for e-commerce and online shopping has created fortunes for technology investors, savings for consumers and vast efficiencies for a new and constantly evolving ecosystem of suppliers and supply chains. Traditional brick-and-mortar outlets (and the retail chains that own

them) are struggling to adapt to this new dimension of competition. The

relationship between e-commerce and traditional retail activity seems to have

reached a tipping point in the United States. 

Bondholders have long feared "the tyranny of the majority" and historically have found limited comfort in a provision of the Trust Indenture Act (the "TIA") that provides minority bondholders with a veto over proposed legal modifications to core payment terms. In the immediate wake of the Second Circuit's recent decision in Marblegate Asset Management v.