As a wise man is wont to say, “Where you stand depends on where you sit.”
This statement applies with full force to the recent, related opinions from Judge Marvin Isgur of the United States Bankruptcy Court for the Southern District of Texas, addressing the effects of a so-called “uptier” liability management transaction.1
Procedurally, Judge Isgur’s rulings denied in part and granted in part motions for summary judgment, permitting certain claims to proceed to trial beginning on January 25, 2024.
The last 12 months have seen a steady increase in restructuring and stressed or distressed financing transactions in the European market across a range of sectors, including tech, real estate, hospitality, manufacturing and retail.
Celsius’ retail borrowers finally have an answer on who owns the cryptocurrency they deposited into Celsius in exchange for a loan from Celsius – spoiler alert: on November 13, 2023 the bankruptcy court held that Celsius’ terms of service “clearly and unambiguously” gave Celsius ownership of retail borrowers’ cryptocurrency. The bankruptcy court’s decision follows its January 2023 decision which similarly held that the cryptocurrency of Celsius’ “Earn” customers also belonged to Celsius because the terms of service similarly unambiguously granted Celsius title ownership.
FSMA 2023 includes a court procedure for failing insurers to temporarily write-down liabilities, with implications for counterparties.
The ruling, which held that the transaction did not violate the implied covenant of good faith and fair dealing, highlights the importance of carefully drafting lending documents.
On June 6, 2023, Judge David Jones of the United States Bankruptcy Court for the Southern District of Texas (the Bankruptcy Court) held that the 2020 Serta Simmons "uptier" transaction (the Transaction) was permitted under Serta's existing 2016 credit agreement (the Credit Agreement), a decision that could have broad implications for the permissibility of such transactions.1
A bankruptcy petition should not proceed if the debt is disputed and subject to an exclusive jurisdiction clause in favour of a foreign court.
On May 5, 2023, the SEC filed a civil complaint in the U.S. District Court for the Northern District of New York against a mutual fund’s adviser for aiding and abetting violations of Rule 22e-4 (the “Liquidity Rule”) by the mutual fund it advised (the “Fund”) and whose Liquidity Risk Management Program (“LRMP”) it administered.
Talking about liability management exercises in Europe is interesting stuff for advisers, but we’ve not seen them occur with the frequency that many people thought a few months ago. Why is that?
Adler Group S.A. (together with its subsidiaries, the “Group”) owns and manages a portfolio of multi-family residential rental properties in Germany. The Group has faced financial headwinds caused by a downturn in the German property market and a negative global macroeconomic landscape exacerbated by, amongst other things, the COVID-19 pandemic and the ongoing war in Ukraine.
As we continue to work with clients regarding the Bank of England’s statement as to its intention to apply to place Silicon Valley Bank UK Limited (SVB UK) into a bank insolvency procedure, please see below for responses to some frequently asked questions surrounding the current situation. Please note that this list covers general topics related to rapidly changing circumstances.