Timothy Graulich and Elliot Moskowitz, Davis Polk & Wardwell LLP
This is an extract from the 2020 edition of the Americas Restructuring Review, published by Global Restructuring Review. The whole publication is available here.
In summary
Fernando Daniel Hernandez, Marval O’Farrell & Mairal
This is an extract from the 2020 edition of the Americas Restructuring Review, published by Global Restructuring Review. The whole publication is available here.
In summary
On August 23, 2019, the Small Business Reorganization Act of 2019 (the “Act”) was signed into law. The Act, which goes into effect in February of 2020, creates a new Subchapter V under Chapter 11 of the U.S. Bankruptcy Code.
In the past, few small businesses have been able to reorganize under Chapter 11 of the Bankruptcy Code due to the costs and administrative burdens associated with the process.
In bankruptcy, a debtor must relinquish assets to satisfy debts. But there are exceptions to this general rule. Certain assets may be exempted from a debtor’s bankruptcy under federal and state law. Other assets, which are subject to a contractual loan agreement and the security interest of a lender, may be “reaffirmed” by a debtor pursuant to a reaffirmation agreement.
The judicial managers of offshore oil and gas group Swiber have announced a restructuring plan for the company – which includes handing over shares to its professional services providers in part-payment of fees.
Judicial managers Bob Yap Cheng Ghee, Ong Pang Thye and Tay Puay Cheng of KPMG published the plan on 7 May, urging creditors to vote in favour to avoid Swiber’s liquidation.
Hong Kong’s restructuring scene is one of the most cross-border in the world, with three-quarters of its listed companies incorporated offshore and most restructurings having a mainland China connection. But the territory still lacks a statutory regime for cross-border recognition – as recently brought into focus in the restructuring of Singaporean engineering company CW Group. What does this mean for international insolvencies in the region?
EY's Hunter Kelly and Alan Hudson have been appointed administrators over UK construction services company Interserve, hours after it failed to secure shareholder approval for a restructuring plan.
Kelly and Hudson were appointed over Interserve Plc, the holding company for the Interserve Group, on 15 March after the plan failed to win approval at a shareholders' general meeting earlier the same day.
There is nothing quite like obtaining a new customer or getting a new big sale - the prospect of recurring revenue from a new source, the validation of business strategy, or the culmination of a successful negotiation.
However, there is nothing more disheartening than when a new customer is unable or unwilling to pay forthe product you just shipped or services you just provided. Perhaps there is one thing that is worse, when a long-term customer fails to pay.
Singapore’s new restrictions on ipso facto clauses are welcome news to the local restructuring community, and a strong step towards establishing it as one of the region’s premier restructuring hubs. But how will these restrictions affect innocent counterparties and existing commercial contracts, ask partner Guan Feng Chen and associate Jonathan Tang at Morgan Lewis Stamford?
New restrictions on ipso facto clauses
The purpose of bankruptcy is twofold: (1) to provide the party filing for bankruptcy—the “debtor”—with a fresh start, and (2) to fairly distribute the debtor’s non-exempt assets to creditors in accordance with the priority scheme set forth in the U.S. Bankruptcy Code. This may sound relatively simple, but accomplishing these dual objectives can be difficult. One of the challenges in all bankruptcy cases is determining the scope and extent of assets that constitute “property of the estate” which are available for distribution to creditors.