Dot Your I’s and Don’t Forget the T’s: Lender Loses Its Secured Status for Missing ‘T’ in Borrower’s Middle Name
A recent bankruptcy case dramatically illustrates how critical it is for a lender to strictly comply with the requirements for creating a legally effective UCC financing statement, and the hard lessons that follow if a lender fails to do so. In Mainsource Bank v. LEAF Capital Funding, LLC (In re Nay), 563 B.R. 535 […]
A Letter Of Credit and the Bankruptcy Paradox: Will It Protect You? – Maybe!
A letter of credit (“LC”) can be a valuable tool in a trade creditor’s arsenal to secure payment of an account and at the same time avoid a future bankruptcy preference claim. However, creditors should beware. They can on occasion find themselves in the middle of what we call the “payment from the debtor bankruptcy […]
Creditors’ Committees in Bankruptcy Cases
Consider the following scenario: The debtor filed a Chapter 11 reorganization case a couple of weeks ago and you just received an invitation from the Office of the United States Trustee to volunteer to be a member of the Official Committee of Unsecured Creditors of the debtor. Should you seek to join the committee? Is […]