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Corporate Governance in Distressed Situations


Level: Advanced
Runtime: 76 minutes
Recorded Date: May 19, 2021
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Agenda

  • Appointment of Independent Directors
  • The benefits
  • Avoidance of conflicts of interest
  • Resolution of intercompany conflicts
  • Access to restructuring expertise
  • The issues
  • Rubber stamp approvals
  • Taking on the role of examiner of the UCC
  • Is an Independent Director truly independent?
  • Conclusion
Runtime: 1 hour, 16 minutes
Recorded: May 19, 2021

Description

This panel will focus on different strategies sponsors are using to retain control (or at least put a stake through) the bankruptcy process. What are the risks to sponsors/litigation issues?

The panelists will also discuss fiduciary duties, managing conflicts and retaining separate counsel, the interplay between corporate governance and aggressive sponsor action (e.g., selling or spinning/stripping-off assets), sponsor affiliates purchasing debt in the portfolio company’s capital structure, and 10b-5 compliance, as well as negotiating/litigating with a difficult board.

This session also includes a discussion of issues that arise when dealing with a challenging board of directors, especially those where some or all directors have been appointed by a controlling shareholder.

This program was recorded as part of the American Bankruptcy Institute's New York City Bankruptcy Conference held on May 19th, 2021.

Provided By

American Bankruptcy Institute
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Panelists

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Michael H. Torkin

Partner, Restructuring and Bankruptcy Practice
Simpson Thacher & Bartlett LLP

Michael H. Torkin is a partner with Simpson Thacher & Bartlett LLP in its Restructuring and Bankruptcy Practice in New York, and he founded the firm’s Private Capital and Special Situations Investment Group. His multidisciplinary practice includes representing companies on liability management, recapitalization and restructuring transactions, both in and out of court, domestically and internationally. He also routinely represents sponsors, acquirers of distressed businesses, and hedge fund and private-equity fund clients in connection with a broad array of special-situation investments and recapitalization transactions.

During his career, Mr. Torkin has been involved in restructuring matters across the globe, including Canada, Latin American, Mexico, the U.K., Israel, Africa, The Netherlands and Australia. His practice has included the representation of numerous private equity and hedge fund clients, including Angelo Gordon, The Blackstone Group, The Carlyle Group, Chambers Energy Partners, Charterhouse, First Reserve, KKR Credit, Platinum Equity, Pointstate Capital, Primavera Capital Group, Riverstone and Silver Lake Partners, as well as corporates on an array of transactions.

Mr. Torkin is ranked as a leading lawyer by Chambers USA and by Chambers Global and The Legal 500 United States, and he was recognized by The M&A Advisor as one of the top “40 under 40” M&A, financing and turnaround professionals in 2010 and by Turnarounds & Workouts as one of 12 “Outstanding Young Restructuring Lawyers” in 2009 and 2010. He is a member of ABI and the Turnaround Management Association.

Mr. Torkin received his B.A. in 1993 from the University of Western Ontario and his J.D. in 1997 from Osgoode Hall Law School.

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Scott J. Greenberg

Partner & Co-Chair, Business Restructuring and Reorganization Practice Group
Gibson, Dunn & Crutcher LLP

Scott J. Greenberg is a partner in Gibson, Dunn & Crutcher’s New York office and co-chairs the firm’s Business Restructuring and Reorganization Practice Group. He focuses his practice on representing debtors and creditors in in-court and out-of-court restructurings.

Mr. Greenberg has been consistently recognized as leading restructuring lawyer by Chambers USA: America’s Leading Lawyers for Business, The Best Lawyers in America and New York Metro Super Lawyers. He has also been named a “Leading Lawyer” and “Next Generation Lawyer” by The Legal 500 US, a “Leading Global Bankruptcy & Restructuring Lawyer” by Lawdragon, an “Outstanding Young Restructuring Lawyer” and twice named an “Outstanding Restructuring Lawyer” by Turnarounds & Workouts, a “Rising Star” by IFLR1000, and a Bankruptcy “MVP” and “Rising Star” by Law360.

Mr. Greenberg’s recent representations include serving as lead counsel on Outcome Health, Rex Energy, M&G Chemicals and American Apparel’s chapter 11 cases and as lead counsel for Transtar (DACCO Transmission Parts [NY] Inc.) and Nextel (NII Holdings Inc) in their chapter 11 cases in the SDNY. On the creditor side, he has a market-leading practice and recently represented the term lenders in 4L/Clover, Akorn, AMC, Catalina Marketing, Constellis, Crossmark, David’s Bridal, Garrett Motion, Global Eagle Entertainment, Iqor, Mallinckrodt, Monitronics, NPC, Savers, Serta, Skillsoft, Sunguard, Tailored Brands, TNT Crane, Town Sports and WorldStrides.

Prior to joining Gibson Dunn, Mr. Greenberg was a partner at Jones Day from 2013-19, where he also served as co-head of Jones Day’s Business Restructuring & Reorganization practice. He began his career as an associate at Weil, Gotshal & Manges LLP in its restructuring practice.

Mr. Greenberg received his B.S. cum laude in 1999 from Boston University and his J.D. with honors from Emory University in 2002, where he was a member of the Order of the Coif.

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Hon. Melanie L. Cyganowski (Retired)

Adjunct Professor
St. John University School of Law

Judge Cyganowski is a member of the firm of Otterbourg, Steindler, Houston & Rosen, P.C. in New York City. Prior to this, she served as a United States Bankruptcy Judge for the Eastern District of New York from 1993-2007 and as Chief Judge from 2005-2007. She received her J.D., magna cum laude, from the State University of New York at Buffalo School of Law. Following graduation from law school, Judge Cyganowski served as a law clerk to the Honorable Charles L. Brieant, United States District Judge for the Southern District of New York. Following her clerkship, she was a litigation associate at Sullivan & Cromwell (1982-1989) and a senior attorney in litigation at Milbank, Tweed, Hadley & McCloy (1989-1993).

Judge Cyganowski has written numerous articles concerning pressing issues in bankruptcy and frequently appears as a commentator on Fox Business News. She is a Fellow of the American Bar Foundation and also an active member of the Commercial and Federal Litigation Section of the New York State Bar Association, the ABI, the Federal Bar Council, the Bar of the City of New York, and the National Conference of Bankruptcy Judges.

Judge Cyganowski teaches Bankruptcy Ethics, Fraud and Malpractice with Judge Morris and has, in the past, also taught Domestic Relations in Bankruptcy and Chapter 11 Reorganization.

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Marc D. Puntus

Partner
Centerview Partners, LLC

During his over 25-year career, Marc Puntus has led restructuring, financing and M&A assignments for companies, creditors, acquirers, shareholders and other stakeholders across a wide array of industries, including retail and consumer, energy, general industrial, chemicals, automotive, transportation, telecommunications and technology, leisure, hospitality and gaming, healthcare, and financial institutions.

Mr. Puntus joined Centerview Partners in 2011 to establish its restructuring and debt advisory practice, which he co-heads. Prior to joining the firm, Mr. Puntus was a Managing Director and founder of Miller Buckfire & Co. Before that he was a member of the financial restructuring group of Dresdner Kleinwort Wasserstein, and prior to joining DrKW. Mr. Puntus was a Partner in the Business, Finance and Restructuring department of Weil, Gotshal & Manges LLP.

Mr. Puntus is a member of several industry trade organizations, including the American Bankruptcy Institute and the Turnaround Management Association and is a frequent lecturer on restructuring, financing and M&A topics. Mr. Puntus is a steadfast supporter and board member of various charitable and educational organizations. He serves on the Board of Advisors of the McDonough School of Business at Georgetown University.

Mr. Puntus received a J.D. (cum laude) from Boston University School of Law and a B.S.B.A./Finance (magna cum laude) from Georgetown University.

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Albert M. Togut

Managing Partner
Togut, Segal & Segal LLP

Albert M. Togut is the senior member of Togut, Segal & Segal, LLP in New York, where he pioneered the use of conflicts counsel in mega-cases, and co-chaired ABI’s Commission to Study the Reform of Chapter 11.

Throughout his more than 40 years of practice, he has been involved in some of the largest and highest-profile chapter 11 cases, including General Motors, Chrysler Motors, American Airlines, Kodak, Relativity Media, A&P, Charter Communications (Charter Investment Inc.), Ambac Financial, Rockefeller Center, Enron Corp., Delphi Corp., Collins & Aikman, Saint Vincents Catholic Medical Centers, Tronox International, Loehman’s, AbitibiBowater, Inc. (BCFC), Frontier Airlines, Tower Automobile, Daewoo International (America) Corp., Loews Cineplex, Olympia & York World Financial Center and NRG Energy. He represented the retired employees committee in Nortel and has represented the creditors and went on to be trustee of the Finley Kumble, Shea & Gould, Bower & Gardner and Berger Steingut lawfirms. He was also lead counsel to Dewey & Lebeouf in its chapter 11 case, and was the trustee for Refco LLC, which, at $4 billion, is the largest chapter 7 case in the history of bankruptcy.

Mr. Togut is a Fellow of the American College of Bankruptcy, a Fellow of the International Insolvency Institute, a former vice president of ABI and past chair of its New York City Bankruptcy Conference, and a member of the International Bar Association and INSOL He is also an advisory board member of the LL.M. in Bankruptcy program at St. John’s University School of Law and a past president of the Bankruptcy Lawyers Bar Association of New York, and he served on ABI’s fee-study commission, which studied professional fees in chapter 11 business bankruptcy cases.

He received the New York Institute of Credit Leadership Award in 2011 and the 2008 Prof. Lawrence P. King award. In addition, he was named a New York Super Lawyer for 2007-15, named as one of the “Top 100 Lawyers” in New York, and chosen as a “Leading Lawyer” by Chambers USA.

Mr. Togut received his B.S. from New York University in 1971 and his J.D. from St. John’s University School of Law in 1974.

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Hon. Robert D. Drain

Judge
U.S. Bankruptcy, Southern District of New York

Hon. Robert D. Drain is a U.S. Bankruptcy Judge for the Southern District of New York in White Plains. Since his appointment, he has presided over such chapter 11 cases as Loral, RCN, Cornerstone, Refco, Allegiance Telecom, Delphi, Coudert Brothers, Frontier Airlines, Star Tribune, Reader’s Digest, A&P, Hostess Brands, Christian Brothers and Momentive. He also has presided over the ancillary or plenary cases of Corporacion Durango, Satellites Mexicanas, Parmalat S.p.A. and its affiliated U.S. debtors, Varig S.A., Yukos (II), SphinX, Galvex Steel, TBS Shipping, Excel Maritime, Nautilus, Landsbanki Islands, Roust and Ultrapetrol. He also has served as the court-appointed mediator in a number of chapter 11 cases, including New Page, Cengage, Quicksilver, LightSquared, Molycorp and Breitburn Energy.

Prior to his appointment to the bench in May 2002, Judge Drain was a partner in the bankruptcy department of Paul, Weiss, Rifkind, Wharton & Garrison, where he represented debtors, trustees, secured and unsecured creditors, official and unofficial creditors’ committees, and buyers of distressed businesses and distressed debt in chapter 11 cases, out-of-court restructurings and bankruptcy-related litigation. He was also actively involved in several transnational insolvency matters.

Judge Drain is a Fellow of the American College of Bankruptcy and a member and board member of ABI, a member of the International Insolvency Institute, a member and Secretary of the National Conference of Bankruptcy Judges and a founding member and chair of the Judicial Insolvency Network. He also is the current chair of the Bankruptcy Judges Advisory Group established through the Administrative Office of the U.S. Courts, and was appointed to the FDIC’s Systemic Resolution Advisory Committee through May 1, 2021.

Judge Drain was an adjunct professor for several years at St. John’s University School of Law’s LL.M. in Bankruptcy Program and currently is an adjunct professor at Pace University School of Law. He has lectured and written on numerous bankruptcy-related topics and is the author of the novel The Great Work in the United States of America. He received his B.A. cum laude from Yale University and his J.D. from Columbia University School of Law, where he was a Harlan Fiske Stone Scholar for three years.


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