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Debt Exchange Offers in the Current Market
The recent financial crisis and dislocation in the financial markets has had significant consequences for bankruptcy and restructuring professionals. One such consequence is a dramatic increase in the use of debt exchange offers as a liability management tool.
There has recently been an unprecedented level of debt exchange offer activity in the United States: nearly $30 billion was exchanged in 2008, compared with $15 billion in the previous 24 years combined, according to professor Edward Altman of NYU's Stern School of Business. See Dena Aubin, More Debt Exchanges Loom As Buyout Loans Come Due, REUTERS, Apr. 17, 2009. Such activity accelerated in December 2008, when eight of the 12 exchanges in 2008 occurred. See Vyvyan Tenorio, Debt Exchange Offers Expected to Rise, THEDEAL.COM, Jan. 30, 2009. During the first four months of 2009, at least 28 companies engaged in debt exchange offers and/or made arrangements with lenders to extend payments, repurchase debt at a discount or reissue debt on more favorable terms, in most cases at less than 50 cents on the dollar and a few close to 10 cents. See Matthew Sheahan, Bondholders Push Back on Exchanges, LEVERAGED FIN., May 6, 2009. This surge in activity is expected to continue into 2010, as various underlying market conditions persist ' i.e., an abundance of over-levered companies, tight credit markets, increasing default rates, bleak near-term earnings and revenue prospects, and depressed trading prices for speculative-grade corporate debt.
The DOJ's Corporate Enforcement Policy: One Year Later
The DOJ's Criminal Division issued three declinations since the issuance of the revised CEP a year ago. Review of these cases gives insight into DOJ's implementation of the new policy in practice.
The DOJ's New Parameters for Evaluating Corporate Compliance Programs
The parameters set forth in the DOJ's memorandum have implications not only for the government's evaluation of compliance programs in the context of criminal charging decisions, but also for how defense counsel structure their conference-room advocacy seeking declinations or lesser sanctions in both criminal and civil investigations.
Use of Deferred Prosecution Agreements In White Collar Investigations
This article discusses the practical and policy reasons for the use of DPAs and NPAs in white-collar criminal investigations, and considers the NDAA's new reporting provision and its relationship with other efforts to enhance transparency in DOJ decision-making.
Bankruptcy Sales: Finding a Diamond In the Rough
There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.
A Lawyer's System for Active Reading
Active reading comprises many daily tasks lawyers engage in, including highlighting, annotating, note taking, comparing and searching texts. It demands more than flipping or turning pages.