About the Course
Introduction
This CLE webinar will discuss bankruptcy provisions in executory commercial contracts. The panel will identify unenforceable provisions and provide drafting tips to insulate parties from the consequences of bankruptcy filings by the counterparties to their agreements.
Description
Most businesses, no matter what the industry, rely on executory contracts that often contain bankruptcy provisions. When entering into any agreement it is important for businesses to understand the implications of these provisions and the risks they may present if the counterparty files for bankruptcy.
Bankruptcy provisions often provide that upon a bankruptcy filing of any party to the contract, the contract shall be deemed terminated and unenforceable. Bankruptcy courts refer to such contract provisions as unenforceable, ipso facto clauses. Contractual waivers of the automatic stay (established by Section 362 of the Bankruptcy Code) are not per se unenforceable like ipso facto clauses, but the enforceability of such waivers is the exception, not the rule.
Beyond ipso facto clauses and automatic stay waivers, references to the bankruptcy process in any contract should be scrutinized. Such provisions could unintentionally invoke provisions of the Bankruptcy Code, creating confusion at the time of enforcement or seek to avoid the requirements of the Bankruptcy Code in a way that would never be tolerated in a bankruptcy setting.
The better approach when drafting bankruptcy provisions is that they provide clarity in a stressful bankruptcy situation. Regardless of what form bankruptcy provisions take, the parties should understand the terms at the time of execution of the contract rather than try to understand what they've agreed to after a bankruptcy filing occurs.
Listen as our authoritative panel discusses key considerations when reviewing and drafting bankruptcy clauses and provides tips for providing innovative relief in advance of a bankruptcy filing.
Presented By
Ms. Feldsher’s primary focus is representing secured creditors, special situations investment funds, private credit providers, and ad hoc groups in bankruptcy proceedings, section 363 sales, and in-court and out-of-court complex corporate debt restructurings and recapitalizations. She also represents troubled corporate debtors in reorganizations, asset sales, loan restructurings, and commercial loan transactions. Ms. Feldsher has directed all aspects of the bankruptcy process for debtors and creditors. She has experience in chapter 11 plan formulation and confirmation, relief from stay and cash collateral negotiations, and debtor-in-possession (DIP)/exit financing negotiations and related hearings. Ms. Feldsher also routinely advises on innovative financing solutions, intercreditor agreement terms and enforcement, and “zone of insolvency” issues and fiduciary duties.
Ms. Jewett-Brewster is the leader of the firm’s Financial Services practice group. She has over twenty years of experience advising creditor clients in every aspect of insolvency law, including without limitation, in the workout, restructuring and enforcement of commercial loans and in business bankruptcy cases nationwide.
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This 90-minute webinar is eligible in most states for 1.5 CLE credits.
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Date + Time
- event
Tuesday, June 23, 2026
- schedule
1:00 PM ET/10:00 AM PT
I. Review of common boilerplate bankruptcy provisions
A. Ipso facto clauses
B. Automatic stay waivers
II. Bankruptcy provisions that require close scrutiny
III. Strategies and drafting tips to minimize the negative effects of bankruptcy on contracts
A. Shortening the agreed-upon term of the contract
B. Stipulations and affidavits of fact
C. Characterization of the transaction
D. Forward contract treatment
E. Exceptions for intellectual property contracts
F. Other innovative forms of relief to include
IV. Lessons learned from caselaw interpreting bankruptcy contract provisions
V. Practical considerations and key takeaways
The panel will review these and other key issues:
- What are examples of common unenforceable ipso facto clauses in contracts?
- What types of bankruptcy process references in contracts should be carefully scrutinized?
- What drafting techniques are available to minimize the negative effects of a contract counterparty's bankruptcy filing?
- What impact do recent caselaw interpretations have on drafting these clauses?
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