Education & Information About Restructuring & Insolvency

Fourth Circuit Approves Recharacterization of Secured Debt Into Equity

November 28, 2016

It its recent unpublished opinion PEM  Entities, LLC v. Province Grande Old Liberty, LLC, 2016 WL 4254917, (4th Cir. Aug. 12, 2016), the Fourth Circuit Court of Appeals affirmed the bankruptcy court’s award of summary judgment to certain...

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PUBLIC NOTICE OF SALE: Sale of 14-Story Presidential Tower: 222 Units on 5.5 Acres in Atlanta (S. Gregory Hays as Receiver)

November 21, 2016

PUBLIC NOTICE OF SALE OF ATLANTA OFFICE TOWER AND 5.5 ACRES Hays Financial Consulting as Receiver and Greystone Brown Real Estate Advisors are conducting a sale by receiver of the Presidential Tower and surrounding acreage in...

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PUBLIC NOTICE OF PRIVATE SALE OF OPERATING COMPANY: The Court-Appointed Receiver of Evans Tempcon, Inc. Announces the Going-Concern Private Sale of Industry Leading Company That Engineers & Manufactures HVAC Systems & Components for RVs, Agricultural & Specialty Vehicles

November 21, 2016

NOTICE OF SALE OF OPERATING COMPANY EVANS TEMPCON, INC. Charles (Chip) Hoebeke of Rehmann Turnaround and Receivership Services, LLC, appointed as the Receiver over Evans Tempcon, Inc. (“Evans”) by the U.S. District Court for the Western...

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eSign & Commercial Finance: A License to Trash the Original Note?

January 26, 2016

Are “electronic document” provisions appearing in your commercial loan documents?  This is the second in a series examining two provisions recently reviewed by me in commercial real estate transactions.   Unfortunately, the two provisions have serious problems: for UCC Article 3 notes, making a copy of it will not clothe the copy with Article 3 protections. Copy & Trash the Original Note: No No & No Electronic...

Ninth Circuit Requires Debtors to Pay Interest at Default Rate to Cure Default

November 30, 2016

In the recent decision of Pacifica L51 LLC v. New Invs., Inc. (In re New Invs., Inc.), No. 13-36194, 2016 WL 6543520 (9th Cir. Nov. 4, 2016), the Ninth Circuit held that Section 1123(d) of the Bankruptcy Code legislatively overruled Great W. Bank & Tr. v. Entz-White Lumber & Supply, Inc. (In re Entz-White Lumber & Supply, Inc.), 850 F.2d 1338 (9th Cir. 1988), and required debtors to pay interest at the default rate to...

Zacks Investments Having Trouble Making Up its Mind About Aramark

December 3, 2016

I went into Fidelity's website to research the stock of Aramark, the food services provider.  Under the "News and Events" tab, these were the four most recent items: Zacks Investment Research, Inc. downgrades ARAMARK from HOLD to SELL. Investars Analyst Actions - private – 12/01/2016 ...

Hanjin Shipping Update - Changes to the Time Table

November 19, 2016

Yesterday I made the post immediately below this one, discussing transparency issues in the bankruptcy proceedings of Hanjin Shipping.  It was read by thousands of people around the World in a matter of hours.  I subsequently invited those following the case closely in the shipping industry to post court filings to a website that can be made publicly available.  I am happy to help, and await a positive response.Meanwhile, I was...

Something Smells Fishy and it Isn’t the Fish: Chapter 11 Trustee Appointed by Southern District of New York Bankruptcy Court in Case Involving Anchovy Fisheries

December 2, 2016

Section 1104(a)(2) of the Bankruptcy Code provides for the appointment of a chapter 11 trustee “if such appointment is in the interests of the creditors, any equity security holders, and other interests of the estate . . . .”  While it is not often that we see a court displace management pursuant to section 1104(a)(2), it does happen on occasion.  One such recent case is In re China Fishery Group Limited. Case No. 16-11895...

Jevic Could Be the Most Consequential Chapter 11 Decision in Many Years

October 14, 2016

The U.S. Supreme Court will hear the case of Czyzewski v. Jevic Holding Corp. during the new term that began last week.  The questions it presents are relatively simple.  First, can a bankruptcy court, in dismissing a case under the U.S. Bankruptcy Code, permit parties to “structure” the dismissal to include substantive provisions regarding the distribution of assets of a debtor’s bankruptcy estate, instead of simply...

Third Circuit Departs from Momentive and Reinstates EFIH Noteholder Make-Whole Claims Causing Uncertainty over EFH’s Ability to Exit Bankruptcy

December 1, 2016

  Recently, the Third Circuit reversed decisions issued by the Delaware Bankruptcy and District Courts and permitted first and second lien noteholders of Energy Future Intermediate Holding Company LLC and EFIH Finance Inc. to receive payment of a make-whole premium. In re Energy Future Holdings Corp., No. 16-1351 (3d Cir. Nov. 17, 2016).  The decision, which is largely grounded in New York law, departs from recent controversial...

ABA Journal Blawg 100!

November 30, 2016

Credit Slips is honored to have been selected as part of the ABA Journal's Blawg 100, their annual list of the top 100 blogs about law and lawyering. It is our second year in a row for inclusion on the list. We appreciate all of our readers and are humbled by the time you spend with us. The comments to the posts continually demonstrate that one of the things that makes this blog work is our readership. Thanks for visiting.

Delaware Organizational Meeting – Hampshire Group Ltd.

December 1, 2016

Upcoming Committee Formation Meeting: Wednes., December 7, 2016, 10:00 a.m. Case Name: 16-12634 (LSS) Location: The Doubletree Hotel 700 King Street Wilmington, DE 19801 The Notice of Formation Meeting for Official Committee of Unsecured Creditors can be found here.   View the debtor’s press release for further details. Contact Norman L. Pernick and  Nicholas J. Brannick for more information.

Ponzi Scheme Lender May Be On The Hook, After All!

November 21, 2016

The skinny:  the Sixth Circuit recently revived a trustee’s $17 million avoidance and claw-back suit against a lender, finding that the lender’s existing security interests could  have been extinguished via novation. ...

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Supplier! Can Your Unpaid Administrative Claim Be Setoff Against Your Preference Liability?

November 14, 2016

A sophisticated Supplier sells “meat products” (yum) to a struggling manufacturer (in this case, of food). The manufacturer files a petition to commence a chapter 11 case. The manufacturer (and now debtor-in-possession or Debtor) wants...

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Limiting Credit Bidding “For Cause” After In re Aeropostale

November 7, 2016

Section 363(k) of the Bankruptcy Code (the “Code”) allows a secured creditor to bid at a section 363 sale and use the amount of their claim to offset the purchase price at the sale, called “credit bidding.”[2]   A...

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