by: Kyung S. Lee
Diamond McCarthy LLP;
Houston
With a substantially increasing number of chapter 11 cases filed ending up in a sale pursuant to Bankruptcy Code §363, bankruptcy practitioners are now essentially required to develop an understanding of the parameters of credit bidding under §363. One specific situation arising in many §363 sales involves a secured lender “credit bidding” its debt, thereby attempting to become the owner of the collateral or, at the very least, serve as the stalking-horse bidder.
In this situation, the secured lender is generally not a single lender, but is rather a group of lenders. The bank group will have spread the risk of the loan by syndicating the debt, appointing an agent bank and dividing the credit among a group of banks that often, have purchased the debt from the initial participants to the syndicated loan. Working usually with a thick credit agreement and hundreds of collateral agreements, the agent represents the bank group, sometimes with unanimous approval from the group, and other times with only majority support.
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The ABI and Georgetown University Law Center will present "Bankruptcy 2009: Views from the Bench" on October 2 at Georgetown University in Washington, D.C. This year's conference will allow bankruptcy practitioners and judges to convene for a day of top-notch CLE and networking. Hear noted scholar Ken Klee on his new book analyzing more than 100 years of Supreme Court bankruptcy jurisprudence. One of the sessions will be of particular interest to the committee.
Panelists in the session "Asset Sales" will discuss the Lehman, Chrysler and General Motors sales, the Clear Channel decision and other significant issues in the section 363 sale context. Robert J. Rosenberg of Latham & Watkins, LLP in New York will moderate and Mary Jo Dowd of Arent Fox LLP in Washington, D.C. will facilitate. Panelists will include Hon. Leif M. Clark of the U.S. Bankruptcy Court (W.D. Texas) in San Antonio, Hon. Robert D. Drain of the U.S. Bankruptcy Court (S.D.N.Y.) in New York and Hon. Gregg W. Zive of the U.S. Bankruptcy Court (D. Nev.) in Reno, Nev. Please click the link below to view Mr. Rosenberg's materials.
Asset Sale Issues
ABI's 21st Annual Winter Leadership Conference will take place Dec. 3-5 at the gorgeous La Quinta Resort & Club in La Quinta, Calif. This year's conference will offer insights from some of the top insolvency and restructuring experts on issues confronting the profession in 2010.
The Asset Sales Committe will partner with the Secured Credit and Unsecured Trade Creditors committees to present a session entitled "Polaroid and Beyond: Differing Perspectives on What Is the Highest and Best Bid and Other Selected Sales Issues" on Saturday, Dec. 5 at 9:30 a.m. Douglas Deutsch of Chadbourne & Parke, LLP in New York will moderate. Panelists will include Ronald E. Gold of Frost Brown Todd LLC in Cincinnati, Rafael Klotz of Gordon Brothers Group, LLC in Boston and Hon. Donald H. Steckroth of the U.S. Bankruptcy Court (D. N.J.) in Newark, N.J. Register today!
Please submit articles for publication in future editions of the Asset Sales Committee newsletter to John H. Maddock, III at jmaddock@mcguirewoods.com.
