A successful purchase depends not just on negotiating a two-party transaction, but rather navigating the applicable process and dealing with all the competing interests successfully to allow a bid to succeed and closing to occur.
Q: Do opportunities exist for asset buyers in times of distress?
Creditors risk losing important rights in bankruptcy cases if deadlines are not met. Unfortunately, sometimes the existence or relevance of a deadline is not obvious to a creditor. Indeed, bankruptcy notices can be indecipherable and tempting to ignore, but failing to abide by deadlines comes at a high price. A recent opinion from the U.S. Bankruptcy Court for the District of Massachusetts underscores the need for creditors to take timely action to preserve rights, which is especially noteworthy given the current coronavirus pandemic and the expected increase in bankruptcy filings.
GOVERNANCE & SECURITIES LAW FOCUS
Proxima Nova A ExCn 35pt
MAY 2020/LATIN AMERICA
Below is a summary of the main developments in US, EU, and UK corporate governance and securities law since our last update in February 2020.
Financial regulatory developments are available here.
IN THIS ISSUE
This post originally appeared on the Council of Fashion Designers of America website, CFDA.com.
This post originally appeared on the Council of Fashion Designers of America website, CFDA.com.
Americans are in an unemployment crisis due to COVID-19 business closings, and many are accruing debt in order to maintain their basic lives – unpaid utilities, buy food on credit, etc. For many, the vehicle to obtain that debt is credit cards, home-equity loans, or simply failing to pay creditors who invoice customers after providing goods and services, such as doctors.[1]
COVID-19 has had an enormous impact on business relations around the world. This article specifically considers Israeli-founded companies with contracts governed by U.S. law, or that have business operations or assets within the U.S. While every company needs to take steps to conserve cash and cut costs and cash expenditures, the legal implications of such actions must be carefully planned to avoid pitfalls.
The unfortunate reality of the COVID-19 pandemic is that several businesses will not be able to survive this crisis. Legal experts agree that there will be an uptick in bankruptcy filings and Congress took note. The recently enacted CARES Act expanded access to the streamlined, small business Chapter 11 bankruptcy process to more businesses by increasing the debt limits from $2.7 million to $7.5 million for one year.
In our latest installment of our series “Bankruptcy On Ice”, we tackle temporary suspension of bankruptcy proceedings in response to the closure of “non-essential businesses” and other critical protective measures being imposed to fight the spread of COVID-19.
Several lawsuits have emerged in the last week involving the Small Business Administration’s Paycheck Protection Program (PPP). “The Paycheck Protection Program is a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll.”1 The listed criteria for eligibility is very broad. Companies that have 500 employees or less, pay salaries or payroll taxes and were in operation on Feb. 15, 2020, are eligible to apply.2