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Course Details

Course Information
  • smart_display Format

    On-Demand

  • signal_cellular_alt Difficulty Level

  • work Practice Area

    Bankruptcy

Date & Time
  • event Date

    Wednesday, May 18, 2022

  • schedule Time

    1:00 p.m. ET./10:00 a.m. PT

  • timer Program Length

    90 minutes

Credit Information

  • This 90-minute webinar is eligible in most states for 1.5 CLE credits.

$297.00
CLE
ALL

This CLE course will discuss challenges related to providing adequate protection for the use of cash collateral and debtor-in-possession (DIP) financing that are most often contentiously negotiated among the debtor, its secured creditors, and DIP lenders, and that bankruptcy judges intensely scrutinize.

Faculty

Peter Montoni
Partner
King & Spalding LLP

Mr. Montoni is a partner in our Corporate, Finance and Investments practice, specializing in debt restructuring and workouts. He advises senior management and deal team members in all aspects of financing transactions, including structuring, documenting, negotiating and restructuring asset-based loans, asset-backed loans, cash flow loans, and structured financing products across a variety of business sectors, including manufacturing, media, retail, and service industries.

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Sarah Beth Wilson
Partner
Phelps Dunbar LLP

Ms. Wilson's areas of focus include bankruptcy and reorganization, business and litigation.

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Timothy Hoffmann
Miscellaneous

Mr. Hoffmann's practice focuses primarily on bankruptcy and insolvency-related matters. He has represented debtors, lenders, strategic investors, and various other parties in financially distressed situations, including both in-court and out-of-court restructurings.

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Brian Whittman
Managing Director
Alvarez & Marsal Holdings, LLC

Mr. Whittman is a Managing Director with Alvarez & Marsal's North American Commercial Restructuring practice in Chicago. He is the Co-Head of the Midwest region and brings 25 years of experience advising companies requiring performance improvement or financial restructuring across a wide range of industries, including automotive, communications, distribution, manufacturing, media, mining and retail. Mr. Whittman has led complex engagements for companies, secured lenders and creditors, and has served in both interim management and advisory roles.

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Description

When, how, to what extent, and which creditors to protect are the most critical financial issues in any bankruptcy case. The Bankruptcy Code does not define the nature or extent of adequate protection. Still, the debtor's obligation to provide adequate protection must be addressed in budgets, sale orders, bidding-procedures orders, and even plans.

The impact and enforceability of intercreditor agreements and DIP financing terms are central to using cash collateral and adequate protection. Complex issues arise when enterprise value falls over the life of the case and the court must allocate individual collateral value among various competing creditors.

Courts are well aware that creditors often make excessive adequate protection demands and that debtor's stipulations and waivers, for example, under Section 506, are not made at arm's length. Carve-outs require special attention by all parties, and fee caps in a cash collateral order may not be enforceable in confirmation.

Listen as our authoritative panel of bankruptcy practitioners offers guidance on these issues, looks at current case law, and provides practice tips for counsel representing secured creditors, debtors, and DIP lenders.

Outline

  1. Introduction: statutory requirements (Sections 105, 361, 362, 363, 364, and 507; Rule 4001)
    1. What is cash collateral?
    2. What is adequate protection?
    3. Court approval, hearing, notice
  2. Creditor considerations for consenting to use of cash collateral
  3. Impact of intercreditor agreements
  4. Budget issues
  5. Methods of providing adequate protection
  6. Critical provisions in cash collateral orders

Benefits

The panel will discuss these and other key issues:

  • What should creditors do if adequate protection is not negotiated pre-filing?
  • What are the key terms for any cash collateral order?
  • What are some unusual types of adequate protection that have been approved?
  • Can legal fees be recharacterized as payments on debt?
  • What is a fictitious going concern value?
  • Can assets in non-U.S. jurisdictions constitute adequate protection?