To embed, copy and paste the code into your website or blog: A newly enacted New York statute will ease the transition from U.S. Dollar LIBOR to the Secured Overnight Financing Rate (SOFR) while reducing the uncertainty and litigation risk posed by agreements that cannot be amended to adequately address the cessation of U.S. Dollar LIBOR. Such “tough legacy” contracts reference U.S. Dollar LIBOR, extend beyond its cessation date and either lack any post-cessation fallback provision or include a fallback that itself relies on LIBOR or on polling banks for interbank lending rates. The new legislation nullifies such provisions and in some circumstances replaces them by operation of law with SOFR plus a spread adjustment. It also provides a “safe harbor” from litigation where SOFR is selected as a replacement rate for U.S. Dollar LIBOR. The new statute does not, however, prohibit parties from agreeing to a non-SOFR replacement rate or affect the enforceability of contracts providing for non-LIBOR alternatives such as the “prime” or “base” rate.