“Bankruptcy Issues The Defense Industry Should Think About”
The U.S. defense industry is expected to be under increasing financial stress over the next several years. Specifically, reduced Government spending will negatively affect defense contractors who rely primarily on Government contracts and fail to diversify their revenue base. Because some of these companies may either seek to reorganize their capital structures or file for bankruptcy in the near term, it is important for interested parties to consider national security and Government contract issues that may affect the restructuring of a U.S. defense contractor.
This Stroock Special Bulletin examines some of these issues, including some relating to transactions that could result in review by the Committee on Foreign Investment in the United States (“CFIUS”) and others raised under the Anti-Assignment Act by transactions that involve the transfer of Government contracts as assets