Originally published by Bloomberg Finance L.P in the Vol. 4, No. 28 edition of the Bloomberg Law Reports—Bankruptcy Law

The wave of private equity M&A and dividend recapitalization transactions that began in 2004 and continued until the onset of the credit crisis in 2008 resulted in unprecedented growth in the second lien market. A gating item when structuring a second lien financing is negotiating an acceptable intercreditor agreement with the borrower's senior lenders. Given the number of second lien transactions and the rights afforded to secured lenders under the Bankruptcy Code, the intersection between the terms of intercreditor agreements and the Chapter 11 process creates an additional level of complexity in corporate reorganizations, particularly given the relative dearth and inconsistency of case law regarding the enforceability of pre-petition bankruptcy waivers. This article examines the enforceability of pre-petition bankruptcy waivers contained in intercreditor agreements.

View full article, "Emerging Trends in the Enforceability of Bankruptcy Waivers in Second Lien Financing Transactions"