The Tribunal found that the enterprise agreement required Denman to alter or thwart the interests of the members and was therefore not valid under Section 541. Since the application for an exemption from the residence permit was to allow the option to be exercised and the option was invalid, the application was denied. (A) the agent assumes such a contract or lease in accordance with the provisions of this section; and (1) Unless otherwise stipulated in a limited liability partnership agreement or with the written consent of all members, a member: Debtor, Inc. (debtor) opens a case under Chapter 11 of the U.S. Bankruptcy Act (the code) and, among the debtor`s assets, there is a member share of ABA, LLC (company). The company`s enterprise agreement identifies various events that would cause a member to „dissociate. An event is the opening of bankruptcy proceedings involving a member. Another event, in Debtor`s case, is Joe Smith, who ceases to have daily control of Debtor`s affairs. The debtor is still in possession as a debtor and Smith continues to manage the debtor`s day-to-day affairs. The Tribunal found that a three-part procedure for the application of S. 365 (e) and the analysis of the ipso facto provision of the enterprise contract concerned, which purported to terminate the debtor`s non-economic rights to the LLC with the bankruptcy application, was necessary: (i) the specificity of the contractual rights at issue; (ii) if the applicable law expresses a clear policy that the identity of the contractor is essential to the contract; and (iii) whether the identity of a hypothetical assignee would be essential for a non-debtor of the contract, given the business in which the debtor and non-debtor are active. We explain in footnotes why we believe that the Court of Appeal should re-examine some of these issues, including the definition of the „execution contract“ in general and, in particular, whether an option contract such as the sales contract is a contract of execution.
But life and code are not so simple. If the llc interest agreement is an execution, Code 565 exceeds the non-economic elements of the interest in the LLC, and if the debtor, liquidator or third party beneficiary of the assignment can retain those non-economic interests, it becomes the function of a complex analysis resulting from the application of various provisions of P.365. If the curious reader is not already familiar with the No. 365 (c), 365 (e) and 365 (f), he can take a look at these subsections. They contain a confused language, partly consistent with Article 541 (c) (1), partly apparently at odds with heading 541 (c) (1) and partly seemingly inconsistent internally.