Concluding Agreements With Insolvent Party

Most entrepreneurs deal with a company in financial difficulties at some point of their business activity. In some cases, the entrepreneur is aware of the precarious financial condition of its contracting party; in others, this status is unknown to the entrepreneur at the moment of concluding an agreement. Many transactions are also conducted as means of assisting the contracting party with their financial difficulties, by providing additional financing to facilitate restructuring or by allowing for an important project to be completed, thus providing funds to regain financial composure. In many cases, such assistance is granted by affiliates or members of the same financial group.