A secured lender often will advance funds to a borrower following a bankruptcy filing to avoid further deterioration of the lender’s position. With proper documentation and court approval, a loan to a debtor-in-possession can be significantly more secure than a loan made prior to bankruptcy, and it can help guide the course of a Chapter 11 case. Bryan Cave frequently represents secured creditors in negotiating, obtaining approval of and enforcing debtor-in-possession loans, and our attorneys are familiar with the sensitive issues, judicial restrictions and other pitfalls involved in these facilities.
We also regularly represent “new-money” debtor-in-possession lenders that do not have pre-bankruptcy lending relationships with debtors. These substantial loan facilities often involve high-profile Chapter 11 cases, complex cross-border issues, disputes regarding protections to be provided to existing lenders and multi-party negotiations.
- Represent JPMorgan Chase Bank, N.A. as provider of a $750 million DIP facility to packaging manufacturer Smurfit-Stone Container Corporation in its Chapter 11 case in Delaware;
- Represented JPMorgan Chase Bank, N.A. as provider of a $250 million DIP facility in the Chapter 11 case of Interstate Bakeries, Inc., maker of Wonder Bread and other bread and sweet products, in Kansas City, Missouri;
- Represented Bridge Finance Group, LLC as secured creditor and DIP lender to Commonwealth Medical Center in its Chapter 11 case in Pittsburgh;
- Represented Wachovia Capital Finance as secured creditor and DIP lender to Payless Cashways, Inc., an operator of lumber and hardware stores, in its Chapter 11 restructuring in Kansas City, Missouri;
- Represented Silverton Bank as secured creditor and DIP lender to Shores of Panama Inc., owner of a project in Panama City, Florida;
- Represented a Fortune 50 financial services company as secured creditor and DIP lender to an electric motor manufacturer, in its Chapter 11 case in Youngstown, Ohio.