Many indentures contain “make-whole provisions,” which protect a noteholder’s right to receive bargained-for interest payments by requiring compensation for lost interest when accrued principal and interest are paid early. Make-whole provisions permit a borrower to redeem or repay notes before maturity, but require the borrower to make a payment that is calculated to compensate noteholders for a loss of expected interest payments.
The State Airports (Shannon Group) Act 2014 (the “Aviation Act”) came into force on 27 July 2014. The Aviation Act enhances Ireland’s position as a global centre for aviation finance and leasing by, among other things, introducing important reforms in the Shannon Region which will build upon the existing aviation industry of over 40 companies operating in the area.
On 13 August 2014, the Irish High Court gave a judgment which addresses significant issues in examinerships and provides some clarity regarding loan acquisitions and the timing and other considerations for creditors when issuing letters of demand.
Background
In an opinion filed on July 3, 2014, in the case of In re Lower Bucks Hospital, et al., Case No. 10-10239 (ELF), the United States Court of Appeals for the Third Circuit (Third Circuit) affirmed a decision of the United States Bankruptcy Court for the Eastern District of Pennsylvania (Bankruptcy Court), which denied approval of third-party releases benefitting The Bank of New York Mellon Trust Company, N.A., in its capacity as indenture trustee (BNYM, or the Trustee).
On May 28, 2014, the District Court for the Southern District of New York affirmed an order from the bankruptcy court in Dishi & Sons v. Bay Condos LLC, et al.1, approving a sale of the Debtor’s assets, but found that the Debtor’s commercial tenant was entitled to remain in possession of the premises for the remainder of the lease at the specified rent.
In 2011, the US Supreme Court issued its landmark decision in Stern v. Marshall. Turning decades of bankruptcy practice on its head, the Supreme Court held that, even though bankruptcy courts are statutorily authorized to enter final judgments in “core” matters, Article III of the Constitution prohibits them from finally adjudicating certain core matters, such as a debtor’s state law counterclaim against a creditor (so-called “Stern claims”).
Often times indenture trustees seek to sit on creditors committees in furtherance of their fiduciary duties to holders. Obviously, the professional fees and expenses can be paid as a first priority pursuant to a charging lien as provided for under the indenture documents. The payment of such fees and expenses becomes an issue, however, when there are no plan distributions to holders or the plan distributions are illiquid or non-cash.
Insolvency practitioners are routinely asked to adjudicate on claims to retention of title of goods supplied. This task often involves an analysis of whether the goods in question have become fixed to land, irreversibly mixed with other goods or whether they remain as identifiable items.
In the recent case of Re Moormac Developments Limited (in receivership)[1], the High Court gave further clarity to this area of the law.
11/13/13: “Goal for CFPB chief: Calming conflict on car loans”
Waterside Management Company Limited v Brendan Kelly and Asta Kelly[1]