Selling Your Collateral in Chapter 11 Bankruptcy:
Section 363's Faster, Cheaper Approach is at Risk
(Originally presented: Wednesday, May 20, 2009.)
Hosted by Maslon's Financial Securities Group
Moderator
Brian Klein
Presenters
Clark Whitmore, Amy Swedberg and Kesha Tanabe
The Critical Issues
The current financial crisis and tightening of the credit markets are changing the ways that secured lenders receive payment for their collateral in Chapter 11 bankruptcy. Instead of reorganizing under a plan, 363 sales are occurring with increasing frequency.
When the value of collateral is deteriorating, additional financing is scarce, or if time is of the essence, 363 sales can work to the advantage of lenders. Purchasers of assets may also favor 363 sales because they offer certain protections unavailable outside of bankruptcy. However, there are risks with 363 sales. To ensure the maximization of asset value, secured lenders must understand and carefully weigh such risks.
In this seminar, you will learn the differences between sales of collateral in and outside of bankruptcy and the benefits and burdens of selling assets in 363 sales or under a Chapter 11 plan. Maslon's panel of experienced bankruptcy attorneys will guide you through these issues using a typical scenario that secured lenders often face and will answer all of your toughest questions.
Topics will include
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Collateral Sale Options in Bankruptcy and the Advantages and Disadvantages of Each Approach
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Interplay of the Sale Process with DIP Financing and Cash Collateral Issues
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Significant and Evolving Risks to Secured Lenders
Questions may be directed to Lynnette or Patty at 612.672.8251.
