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Dealing With Defaults (Series: Borrower or Lender BE)

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Dealing With Defaults (Series: Borrower or Lender BE)

Some borrowers default. One type of default is a payment default- the loan is not paid when due or a particular payment is missed. The other type of default is a covenant default. This webinar explains both and discusses what happens when one happens.

To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/dealing-with-defaults-2019/

Some borrowers default. One type of default is a payment default- the loan is not paid when due or a particular payment is missed. The other type of default is a covenant default. This webinar explains both and discusses what happens when one happens.

To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/dealing-with-defaults-2019/

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Dealing With Defaults (Series: Borrower or Lender BE)

  1. 1. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe Insert the cover image for this webinar on this slide entirely 1
  2. 2. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe Practical and entertaining education for attorneys, accountants, business owners and executives, and investors. 2
  3. 3. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe Thank You To Our Sponsor 3
  4. 4. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe DISCLAIMER The material in this webinar is for informational purposes only. It should not be considered legal, financial or other professional advice. You should consult with an attorney or other appropriate professional to determine what may be best for your individual needs. While Financial Poise™ takes reasonable steps to ensure the information it publishes is accurate, Financial Poise™ makes no guaranty in this regard. About this PowerPoint: if you are looking at this PowerPoint without the benefit of listening to the conversation that surrounded it then you are doing yourself a disservice. This PowerPoint was prepared in contemplation of being viewed in conjunction with listening to a one hour webinar on the topic 4
  5. 5. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe MEET THE FACULTY Moderator: Rebecca Fruchtman – Mayer Brown LLP Panelists: Phil Buffington – Adams and Reese LLP Candice Kline – Carpenter Lipps LLP Ciara Bochenek– US Bank 5
  6. 6. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe ABOUT THIS WEBINAR: Dealing with Defaults Some borrowers default. One type of default is a payment default- the loan is not paid when due or a particular payment is missed. The other type of default is a covenant default. This webinar explains both and discusses what happens when one happens. 6
  7. 7. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe ABOUT THIS SERIES: Borrower or Lender BE Many companies, and most of any size, use borrowed funds as part of their capital structure. Depending on the nature of the business, its size, time in business, whether it has adequate collateral, and other factors, a business has myriad options when borrowing funds. This webinar series provides a guided tour of the various borrowing options available to businesses, from both a business and legal perspective. Learn the advantages and disadvantages of different types of loans, how to select the right loan for your business, how to negotiate terms, and what happens in the event the loan is defaulted upon. 7
  8. 8. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe EPISODES IN THIS SERIES 1/24/19 Episode #1: What kind of loan? 2/21/19 Episode #2: Basics Concepts Applicable to All Borrowers & Lenders 3/21/19 Episode #3: Alternative Structures- PO Financing, Factoring & MCA 4/18/19 Episode #4: Dealing With Defaults 5/16/19 Episode #5: Trade Finance Basics 8 Dates shown are premiere dates. All webinars will be available On Demand approximately 4 weeks after they premiere.
  9. 9. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe Episode #4: Dealing With Defaults 9
  10. 10. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe WHAT’S THE DEFAULT? • Payment default • Technical default ✓ Financial covenant ✓ Other covenant ✓ Technical but not covenant 10
  11. 11. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe THE CHANGING LANDSCAPE OF BANK LENDING – HOW COMMERCIAL LENDING HAS CHANGED OVER THE PAST TWO DECADES • Commercial loan officers do not have a prolonged apprenticeship so experience is limited; bank acquisitions have resulted in a loss of seasoned lenders • There is more money to lend than there are good loans to make so there is fierce competition for every deal • Lenders and their supervisors generally have compensation incentives tied to performance • There is a decline of the “generalist lender” and a growth of the specialists and niche lenders • Competition from unregulated lenders has increased 11 Special thanks to Richard Carmody for allowing the reprint of these points
  12. 12. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe THE CHANGING LANDSCAPE OF LENDING (con’t) • Compliance issues have become much more important • Fee income is receiving more emphasis because of the competitive pressure on interest rates • Timing of write-offs and recoveries has become more important because of effect on stock price and compensation • Some borrowers have become “too big to fail” because of effect on financial performance of lender • Secondary markets for troubled loans have exploded • Amend and extend • Covenant-lite 12
  13. 13. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe STRATEGIC ALTERNATIVES FOR DISTRESSED BUSINESSES 13 Chapter 11 Assignment for the Benefit of Creditors Creditor Composition Workout/ Forebearance Agreement Sale by Debtor
  14. 14. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe STRATEGIC ALTERNATIVES AGAINST DISTRESSED BUSINESSES 14 Foreclosure Receivership Article 9 Sale Involuntary Bankruptcy
  15. 15. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe FACTORS THAT AFFECT THE DECISION 15 Future of the business going forward Size of the company Relationship with secured creditors Number of creditors and the amount of debt Cost and length of the process Buyer’s risk tolerance
  16. 16. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe KEY QUESTIONS THAT DRIVE STRATEGY • Will customers care that debtor is having financial problems? • How is the debtor’s relationship with its key vendors? • Are any vendors irreplaceable as supply sources? • How competitive is the debtor’s business? • What is the liquidation value of the debtor? • What does a buyer want to do? • Are there personal guarantees? • Are related entities not troubled? 16
  17. 17. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe A BUYER’S PERSPECTIVE • Buyers like to buy cheap but want to avoid risk • Some options are cheaper but pose more risk • Others are more expensive but pose less risk What Legal Risks? 17 Successor liability Allegations of fraudulent transfers
  18. 18. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe CHAPTER 11 REORGANIZATIONS 18 Petition is filed with the bankruptcy court (either voluntarily or involuntarily) The debtor, as the debtor-in-possession, acts as the trustee of the business Debtor-in-possession financing Automatic stay Rejection of certain executory contracts Fixed priority order
  19. 19. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe CHAPTER 11 REORGANIZATIONS ADVANTAGES 19 Binds all creditors Automatic stay (requires all creditors to cease collection efforts) Sales are made free and clear Rejection of burdensome contracts Certain tax advantages
  20. 20. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe CHAPTER 11 REORGANIZATIONS DISADVANTAGES 20 Higher cost Longer process Reporting requirements Stigma associated with bankruptcy
  21. 21. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe CHAPTER 11 PLAN RESTRUCTURING 21 Prepackaged (“Prepack”) Plan Prenegotiated Plan Consensual Plan Fast case (30-60 days); Creditors vote before filing; Unsecured creditors unimpaired, paid in full. Still often a speedy case; Creditors agree to terms before filing, vote after filing; Unsecured creditors may be impaired. More time needed; Creditors reach settlement after filing; Unsecured creditors represented by committee, impaired. Time consuming; settlement difficult and plan challenged by cramdown or impaired creditors or other stakeholders. Disputed Plan Petition Filing
  22. 22. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe AVOIDANCE ACTIONS • Borrowers may transfer assets or collateral to the detriment of the lender. ✓ Keep assets away from lender in advance of enforcement actions or bankruptcy ✓ Take advantage of documentation ambiguity or omissions when planning for possible distress or experiencing distress ✓ Diminish value and enforceability of guarantees ✓ Hide assets or divert assets to other more preferred creditors • Trustee or lender may avoid such transfers and bring the assets back into the mix through state law and bankruptcy law ✓ Uniform Fraudulent Transfer Act – Uniform Avoidable Transactions Act ✓ Bankruptcy Code sections on trustee’s avoidance powers, preferences, and constructive and actual fraudulent transfers (see generally 11 U.S.C. §§ 541-551). 22
  23. 23. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe PREFERENTIAL TRANSFERS • Preference transfer law (Section 547 of the Bankruptcy Code) provides after the fact protection to the debtor’s creditors • Preference statute covers payments on debt of “arms-length” creditors within 90 days of bankruptcy and payments on debt to “insiders” within one year 23
  24. 24. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe PREFERENTIAL TRANSFERS (cont’d) • Any transfer of an interest of the debtor in property: ✓ To or for the benefit of a creditor; ✓ For or on account of an antecedent debt owed by the debtor before such transfer was made; ✓ Made while the debtor was insolvent (presumed for the 90-day period prior to the petition date); ✓ Made (i) on or within 90 days before the date of the filing of the petition; or (ii) between 90 days and 1 year before the date of the filing of the petition, if such creditor at the time of such transfer was an insider; and 24
  25. 25. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe PREFERENTIAL TRANSFERS (cont’d) ✓ That enables such creditor to receive more than such creditor would receive if (i) the case were a case under Chapter 7; (ii) the transfer had not been made; and (iii) such creditor received payment of such debt to the extent provided by the provisions of this title • Unless all elements stated above are proven, a transfer is not avoidable as a preference (Section 547 of the Bankruptcy Code) 25
  26. 26. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe PREFERENTIAL TRANSFERS (cont’d) • If debtor proves all five elements, then a prima facie preference exists (debtor’s burden of proof) • To avoid disgorgement, creditor must then prove that one or more of the preference defenses exist (creditor’s burden) • The defenses are only relevant if prima facie preference exists ✓ Contemporaneous Exchange Defense ✓ Ordinary Course of Business Defense (ordinary for industry or between the parties) ✓ Subsequent New Value Defense 26
  27. 27. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe ASSIGNMENT FOR BENEFIT OF CREDITORS 27 Much like a Chapter 7 Debtor assigns all of its assets to an independent fiduciary for creditors Fiduciary sells all the assets and distributes proceeds to the creditors Distribution is generally done in accordance with the Bankruptcy Code priority scheme
  28. 28. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe RECEIVERSHIPS • Available in stated and federal court • Receiver is similar to bankruptcy trustee • Distributions Similar to Bankruptcy Code 28
  29. 29. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe RECEIVERSHIPS (con’t) • Single Creditor can seek appointment (versus standards of section 303 of Bankruptcy Code) • Greater flexibility within Receivership (less procedural rules and statutory regulations) • Receivership proceeding can be narrowly tailored in drafting the Receivership Order 29
  30. 30. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe CREDITOR COMPOSITION 30 Sometimes referred to as an out-of-court Chapter 11 Creditor composition is a contract between a debtor and its creditors All participating creditors agree to accept certain payments in full satisfaction of their claims
  31. 31. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe CREDITOR COMPOSITION ADVANTAGES 31 Will allow the company to work with its creditors to continue operations May maximize going concern value of the company Less expensive than Chapter 11 No court or trustee oversight No Chapter 11 stigma
  32. 32. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe CREDITOR COMPOSITION DISADVANTAGES 32 Holdouts May impose certain restrictions on Debtor Lengthy negotiating process
  33. 33. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe WORKOUTS • Since it may be difficult to obtain consent of nearly all creditors as required for a composition, a company may opt to seek concessions solely from its financial creditors (bank, equipment lessors, bondholders, etc.) • A Workout Agreement will restructure the debt of a particular creditor 33 Generally, Creditor will agree to deferred payments, extended time of repayment, and/or reduced total amount of indebtedness. In exchange, Debtor may be required to sell assets, grant additional collateral, meet certain operational benchmarks and/or be subject to heightened financial reporting.
  34. 34. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe WORKOUTS ADVANTAGES 34 Because consent of all creditors is not required, generally easier to put in place Easier to negotiate because only one party and may not require disclosure of financial condition to other creditors
  35. 35. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe WORKOUTS DISADVANTAGES 35 Financial creditors are generally secured and may have little incentive to renegotiate terms Financial creditors may insist on restrictions on activities of the business
  36. 36. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe TIPS FOR A SUCCESSFUL WORKOUT • Borrower’s counsel will gain lender’s cooperation more readily if he or she is perceived by the lender to be part of the solution rather than part of the problem • During a workout, lender typically wants borrower to have access to effective legal counsel • If borrower believes lender’s actions in have created potential liability for the lender, borrower is faced with a choice because it is doubtful that lender will participate in a workout under threat • Replacement lenders do not come cheap, but borrower may want to pay price to preserve its causes of action. 36
  37. 37. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe “NAKED” SALE BY DEBTOR • Debtor sells its assets, generally to a secured lender, or to a third party (potentially to its own shareholders) with the consent of the secured lender. • Advantages ✓ Quick and relatively inexpensive method of liquidating a business ✓ May also serve as a quick method for the sale of a company as a going concern • Disadvantages ✓ Requires consent of all lienholders ✓ Treatment and impact of unsecured creditors. ✓ Possibility of being deemed a fraudulent transfer ✓ Breach of fiduciary duty concerns for board of directors of debtor 37
  38. 38. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe ARTICLE 9 SALES • Fast and inexpensive way to sell secured creditor’s collateral • UCC permits secured creditor to take possession of collateral and, without removing collateral from debtor’s premises, dispose of it • Sale must be commercially reasonable • Secured creditor may purchase collateral at a public sale but not at a private sale unless collateral has public market where the price can be readily ascertained • When the rules are followed, all of Debtor’s rights in collateral are transferred and subordinate security interests are discharged. • A good faith purchaser for value takes title free and clear even when secured party fails to strictly comply with the statutes 38
  39. 39. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe “FRIENDLY FORCLOSURES” • Insolvent borrower + all assets liened + ready buyer = “friendly foreclosure” ? • Lender will want to make sure price being paid reasonably equivalent value of assets, certainly more than the lender could expect from a foreclosure and lender liquidation sale. • Other principal concern for lender is that the borrower and the purchaser are truly arms-length • Also may also “Bulk Sales” law (in those jurisdictions that have not repealed Article 6 of the UCC) ✓ Foreclosing lender can sell assets without giving notice to borrower’s creditors because lender is not a person subject to the Bulk Sales Act. The lender is not regularly engaged in selling the goods being sold 39
  40. 40. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe “FRIENDLY FORCLOSURES” - PROCESS • Once lender has satisfied itself on the price and the independence of the purchaser and seller, lender will engage in an exchange of correspondence wherein the lender will declare a default, accelerate the loan and demand payment • In response, borrower will advise lender that it cannot repay the loan • Lender will then foreclose pursuant to its rights in the loan documents and the Uniform Commercial Code • Borrower will waive its rights to notice of the private sale, and lender will take control of the assets and sell them (usually without moving them) to purchaser who will receive lender’s bill of sale with warranty of title resulting from the foreclosure 40
  41. 41. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe AVOIDING LENDER LIABILITY – THE TEN COMMANDMENTS FOR LENDERS • In 1986, Helen Davis Chaitman writing in The Secured Lender (November/December issue) proposed a list of ten commandments for lenders involved in workout situations. Richard Carmody amplified them, and we thank both. • Do Not Make a Sudden Move ✓ Unless absolutely necessary, give a borrower reasonable notice of your intent to terminate a lending relationship ✓ Watch out for declaring a default under a “general insecurity clause” in a note (must be reasonably insecure) ✓ Demand notes may not really be such if inconsistent provisions added ✓ Document and substantiate the reasons for calling the loan 41
  42. 42. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe THE TEN COMMANDMENTS FOR LENDERS (con’t) • Do Not Tell a Lie or a Half-Truth – ✓ This applies to credit inquiries and also to negotiations with the borrower; if you want to exit the relationship, tell the borrower up front • Honor Your Commitments ✓ This applies to making loans and to working out loans. Stand by the terms of your loan documents ✓ Commitments to make loans (or working out loans) or to take (or refrain from taking) other actions – the barest of writings has been held to be a commitment ✓ If still negotiating, put a specific and explicit disclaimer in correspondence; do not soften language to make more agreeable to potential borrower 42
  43. 43. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe THE TEN COMMANDMENTS FOR LENDERS (con’t) • Do Not Run Your Borrower’s Business ✓ Your liability can stretch to borrower and its creditors, including payroll taxes owed to the IRS ✓ Too much control can make you a fiduciary, a principal, or a joint venture; decide how much control you really need ✓ Potential liability to creditors of borrower if you “prop up” borrower to maximize your recovery while borrower purchases on credit ✓ Do not control the board of directors and be extremely careful about having a banker serve as a director. Exercise of voting power can make you an insider under Bankruptcy Code 43
  44. 44. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe THE TEN COMMANDMENTS FOR LENDERS (con’t) • Do Not Use Third Parties to Bail Out of a Bad Loan ✓ Insist on full disclosure to third parties because your desire to exit loan can be used against you • Keep Your Files Clean of Extraneous Comments ✓ This also applies to your e-mail traffic within office ✓ Disgruntled bank employees could deliver documents to a borrower ✓ Make sure memos (and e-mail) are business like 44
  45. 45. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe THE TEN COMMANDMENTS FOR LENDERS (con’t) • Have a Workout Officer Take Over Troubled Loans ✓ Personality problems can lead to cover-ups of bad situations or vindictive attitudes and action by the original loan officer ✓ Need objective view of officer dedicated to maximizing recovery while minimizing liability • Confer With Workout Counsel ✓ An early review of your situation and documents can be critical ✓ You need an “emergency room” lawyer, not an “obstetrician” who insists on enforcing documents as written. Lawyer should be firm but not excessively confrontational. Situation may require change to lawyer with different style 45
  46. 46. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe THE TEN COMMANDMENTS FOR LENDERS (con’t) • Think Carefully Before Pursuing a Deficiency ✓ Judgment proof debtors have nothing to lose by asserting counterclaims that are identified by counsel who would never have been involved but for a lender’s lawsuit • Do Not Be Arrogant ✓ Lenders are not protected species ✓ Put yourself in borrower’s position (are you being fair?) (is your action absolutely necessary to protect the bank) 46
  47. 47. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe ABOUT THE FACULTY 47
  48. 48. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe Rebecca Fruchtman – rfruchtman@mayerbrown.com Rebecca Fruchtman recently joined Mayer Brown LLP’s banking and finance practice group where her practice concentrates on global trade finance and asset based lending matters. Previously Ms. Fruchtman served as general counsel to Bank of America Merrill Lynch’s Business Capital line of business (US Central Region) on asset based lending facilities up to $1 Billion, workout and bankruptcy matters (2017 to 2019) and as counsel to the Bank’s Global Transaction Services Global Trade and Supply Chain Line of Business (2012 to 2017). Prior to joining the Bank, Ms. Fruchtman was a founding partner of Baer Higgins Fruchtman LLC, a law firm focusing on complex bankruptcy and restructuring matters and before that, was an attorney in the Kirkland & Ellis LLP restructuring and corporate finance practice groups from 1999. Ms. Fruchtman has a deep bench of experience in the global trade finance space, in structuring, negotiating and executing securitization, leveraged lease, and other complex financing transactions and in all facets of distressed situations, including extensive involvement in some of the largest bankruptcy cases filed in the US. Ms. Fruchtman has spoken routinely on letter of credit topics at the annual International Banking Law & Practice Conferences and actively participated in the global banking association BAFT IFSA, having spoken at a BAFT 2015 conference in Chicago and been involved in BAFT’s lobbying the Fed on Trade related Dodd-Frank issues and its review of FATCA’s impact on letter of credit fees. For more, go to https://www.financialpoise.com/financialpoisewebinars/faculty/rebecca-fruchtman/ 48
  49. 49. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe Phil Buffington – Phil.Buffington@arlaw.com Phil Buffington joined Adams and Reese in 2011 and serves as Leader of the Financial Services Team, and is a Partner in the Transactions Practice Group. For more than 30 years, Phil has served as a trusted advisor to community, regional and national financial institutions, and he routinely helps these institutions assess and analyze regulatory and litigation risks, including issues involving: His practice is focused primarily on the representation of financial institutions in corporate governance, transactional and bankruptcy matters. He serves on the Adjunct Faculty Staff of Mississippi College School of Law (Banking Law and Business Planning) and also serves as a Faculty Member at the Mississippi School of Banking (Commercial Lending I and II). He is a frequent speaker and presenter for CLE and other courses on topics related bank regulatory matters, commercial lending, secured transactions and other banking topics. 49
  50. 50. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe Ciara Bochenek – ciara.bochenek@usbank.com Ciara Bochenek recently joined the Chicago Large Corporate Banking team at U.S. Bank in October 2018. Before taking this role, she served in various capacities at Bank of America for 13+ years: a Sr Portfolio Specialist in Asset Based Lending, a Sr Portfolio Officer in Mid Corporate Cash Flow Lending, a Sr Special Assets Group Credit Officer in Commercial Banking, and a Credit Products Officer in Healthcare, Institutions, and Government. Mrs. Bochenek is an experienced financing and banking leader with more than 15+ years in the industry, having started her career at JP Morgan Chase. She earned her BBA from Marquette University. She currently lives in the suburbs of Chicago with her husband and two young children. 50
  51. 51. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe Candice Kline – kline@carpenterlipps.com Candice Kline joined Carpenter Lipps & Leland LLP as a partner in its Chicago office in 2017. The firm is an industry-recognized Columbus, Ohio-based litigation boutique. Before turning to law, Candice earned an MBA at the University of Chicago and worked as an experienced corporate and international banker with Citibank and JPMorgan Chase. Her banking background informs her legal advice and commitment to client service, outstanding litigation outcomes, and practical deal making. Candice focuses her practice on commercial disputes, bankruptcy and insolvency matters, and general litigation. Candice has in-depth chapter 11 experience, including preferences and fraudulent transfer actions, settlements, contract disputes, and plan and disclosure statement related litigation. She also litigates in chapter 7 cases. Her recent representations include debtors, trustees, creditors, and investors in cases involving fraud, breach of contract, breach of fiduciary duties, securities fraud, and civil theft. Candice has also recently guided out of court workouts and assignments. Candice is active in the turnaround and legal sectors. She is a director of the Turnaround Management Association, Chicago/Midwest Chapter; a member of the Business and Securities Law Council of the Illinois State Bar Association; and a co-chair of the American Constitution Society, Chicago Lawyer Chapter. Candice also serves on the advisory board of directors for the Institute for Business & Professional Ethics at DePaul University. 51
  52. 52. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe QUESTIONS OR COMMENTS? If you have any questions about this webinar that you did not get to ask during the live premiere, or if you are watching this webinar On Demand, please do not hesitate to email us at info@financialpoise.com with any questions or comments you may have. Please include the name of the webinar in your email and we will do our best to provide a timely response. IMPORTANT NOTE: The material in this presentation is for general educational purposes only. It has been prepared primarily for attorneys and accountants for use in the pursuit of their continuing legal education and continuing professional education. 52
  53. 53. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe ABOUT DailyDAC DailyDAC.com is the leading source of information about assignments, article 9, bankruptcy, receiverships, out-of-court workouts and vulture investing, designed for business owners and vulture investors. Visit us at www.dailydac.com. 53 Premium Public Notice Service DailyDAC’s Premium Public Notice Service helps market asset sales on behalf of fiduciaries (e.g., Chapter 11 debtors-in- possession and committees, trustees, receivers, assignees), secured lenders selling collateral under UCC Article 9, and auctioneers to a very large and self-selected group of potential bidders and their advisors. The Service also assists with noticing other events, deadlines, and milestones – including tombstones and other press releases. Our free weekly newsletter, DailyDAC contains our latest bankruptcy article, current Public Notices and all opportunistic deals added to our proprietary database that week. Sign up at: https://www.dailydac.com/dacyak-weekly-newsletter-signup/
  54. 54. Copyright © 2019 by DailyDAC, LLC d/b/a Financial Poise Webinars™ Receive our free weekly newsletter at www.financialpoise.com/subscribe ABOUT FINANCIAL POISE DailyDAC LLC, d/b/a Financial Poise™ provides continuing education to attorneys, accountants, business owners and executives, and investors. Its websites, webinars, and books provide Plain English, entertaining, explanations about legal, financial, and other subjects of interest to these audiences. Visit us at www.financialpoise.com. 54 Our free weekly newsletter, Financial Poise Weekly, educates readers about business, business law, finance, and investing. To receive it simply add yourself by going to: https://www.financialpoise.com/newsletter/ Email addresses are never sold to or shared with third parties.

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