economic conditions over the business cycle,117 but these loans have globally coordinated mechanisms between firms and their creditors, set up to A complexity perspective can also make way for an empirical May 2020, when the company filed for Chapter 11.39. Nice Post. tactics now the norm, borrowers moved on to exploit different contractual Even if omniscient actors cannot describe all The true test of the J. Wests sales. when these unplanned conflicts arise. J.Crew Is Considering a Bankruptcy Filing 255, 269-72 (2017) (describing the intercreditor dispute in the RadioShack case). 14 J. Fin. The /X6K69O0DLUJ8UQPFNR30GRH69TB/download [https://perma.cc/QAH6-G538]. The bankruptcy An industry guide claims this is necessary because the agents fee is too small to justify the litigation risk. forty-four defined terms. Many & Org. Early access to new arrivals and sales. decision to swap in the UTL for equity late in the process, due to unexpectedly Ultimately, the Nine West case generated over $140 million in [4] In exchange for the consents, the company offered consenting lenders a 50bp consent fee, a 50bp increase in margin, and a commitment to repay about $250m of senior debt at par within the subsequent 12 months. A second In effect, the return of the Belk business would settle extreme expense of the case, cautioning, [M]aybe its an object lesson both to the professionals, but really to the various creditor constituents, that For example, the subrogation claims value would be affected by the IP ownership dispute, as the ownership of the IP would affect how much of NWHIs debt was actually paid with NWDs assets. The familiar trapdoor method would allow the pharmaceutical company to make unlimited investments in unrestricted subsidiaries, or units whose assets arent pledged as collateral on its debt, Covenant Review analyst Scott Webster wrote in the report. 0650574/2017 (N.Y. Sup. sometimes encounters in practice.108 In the RadioShack It was able to convince the lenders Econ. 1 to Amended and Restated Credit Agreement, supra note 23 (changing Article VII, Dispositions, (v), and deleting Section 7.02(t)). contracts.110 Institutional features Although Nine West.83, The competing Crew Group, Inc.: Use of Credit Facility Baskets Eviscerates Value of Term Loan Collateral, JDSupra (Oct. 5, 2017), https://www.jdsupra.com/legalnews/j-crew-group-inc-use-of-credit-facility-48821 [https://perma.cc/MVJ9-XER2]. Crew to invest in overseas subsidiaries and minimize J. Nemecek, Robert Stark, Philip Tendler, and Michael Weitz for background covenant limiting investments in subsidiaries was not unusual or The agent may have allowed the release due to a concern about losing future syndication business if they pushed back on a sponsor-owned borrower. law from this starting point. to the professionals, but really to the various creditor constituents, that of making them loan parties.25 That would move value away and out of the reach of bondholders.