Practices: Finance and Restructuring

The Ungaretti & Harris Finance and Restructuring practice offers lenders, creditors, borrowers and debtors a full range of legal services for their lending, restructuring and bankruptcy needs. Unlike many firms, we make it a point to be sure that our lawyers who specialize in new transactions also get significant work-out and bankruptcy experience and that our bankruptcy litigators are experienced in negotiating and documenting transactions. Thus, our practice group combines lawyers from a variety of disciplines from throughout the firm to focus on restructuring and debt financing matters for financial institutions, underwriters, credit enhancers, servicers and other lenders, as well as borrowers and issuers. The practice is led by Donald L. Schwartz, who was formerly one of the founders and the head of the banking practice at Latham & Watkins. Don has regularly represented nearly all of the major commercial and investment banks that are active in the U.S., as well as commercial finance companies, regional and local banks and mezzanine lenders that are engaged in significant complex matters, including new financings, bankruptcies, restructurings and workouts. Consistently ranked as a “leading bank attorney” by Chambers Global and Chambers USA, Don also served for nearly two decades as the Associate General Counsel of the Commercial Finance Association (the trade association for the secured lending industry).

Attorneys in the Finance and Restructuring practice are experienced business lawyers with specialties that allow them to work together to efficiently assist clients with large, complex matters as well as to deal efficiently with more routine finance and restructuring work. In particular, the practice group assists our clients in the following related areas, often as a multi-disciplinary team that can help deal with all aspects of financing and restructuring:

Commercial & Industrial and Related Financing
We regularly work with both borrowers and lenders in structuring, negotiating and documenting their financial transactions. Whether the transaction is a short term working capital loan, an asset-based financing, a term or mezzanine loan, an ISDA swap, a private placement or a structured on- or off-balance sheet financing, we have experience in a wide range of industries, including utilities, medical device manufacturers, REITs, retail, manufacturing and gaming.

Unlike many firms that regularly represent lenders, we make an effort to also regularly handle negotiations of financings on behalf of borrowing clients, and believe that our familiarity with the practices of major lenders allows us to assist borrowers in identifying business and legal pitfalls that other corporate counsel might not recognize. Also, since the firm has a strong middle-market M&A practice, we often can help introduce clients to each other and many private equity investors regularly turn to us for help with acquisition financings and investment syndication.

Real Estate Financing
While C&I financings often include material real estate collateral and important real property diligence questions, we also regularly represent both borrowers and lenders in connection with "pure" real estate financings. Frequently, banks and other mortgage lenders have their own standard documentation procedures, and we always try to be aware of those procedures - regardless of which party we are representing. We working frequently with all of the major title companies, and having a strong background in all aspects of bank-provided financing. Accordingly, we are able to be both timely and cost-effective on middle-market transactions, while also being experienced in much more complicated matters when serious diligence or structuring advice may be needed such as in a non-recourse or complex, capital-markets-style transactions. Understanding that real estate finance tends to be particularly cost-sensitive, we make a special effort to try to avoid insisting on numerous changes in a lender's standard forms or procedures, except when real business considerations require some type of modification. As is the case throughout our finance-related practice, we often find that we can help introduce clients to each other and provide worthwhile opportunities to our lender clients.

Healthcare Finance
In addition to its strong secured lending real estate experience, the firm has a strong niche practice in healthcare finance, including public finance for nonprofit healthcare provider organizations. We count some of the nation’s largest investment banks, commercial banks and healthcare systems as clients. For our public finance work, we are ranked by Bond Buyer among the nation’s top 100 underwriters’ counsel. Working with attorneys from our nationally recognized healthcare practice, our Finance & Restructuring attorneys can assist lenders, underwriters, borrowers, and bond issuers with any aspect of private or public finance.

Recently the firm has been representing a number of continuing care retirement communities (“CCRC”s) in dealing with financial restructuring questions, and CCRCs are not the only entities in the healthcare industry that will need to address those problems. By teaming the expertise of our healthcare and restructuring professionals, the firm can provide unique and highly effective expertise for clients in this highly complex area.

Mezzanine Lending
Mezzanine loan transactions are an area where we have had special focus, along with typical 1st/2nd lien financings. Mezzanine lenders are often middle-market financial institutions in their own right, and with our extensive knowledge of middle-market financing, we can ensure that the rights and interests of the “junior lender” are protected in dealing with the larger senior lenders. Ungaretti & Harris has represented mezzanine lenders in negotiating their position with the senior lender, and has been particularly effective at documenting “equity kicker” arrangements. Such kickers involve significant tax and contingent payment issues, and require a combination of securities and commercial lending knowledge that we bring to clients.

Project Finance
Project finance to fund the building of energy generation, distribution and storage facilities, and similar capital-intensive construction projects, requires a complex mix of sophisticated legal, financial, regulatory and management issues. Given the hundreds of millions of dollars often at stake, project developers and lenders need multi-disciplinary counsel to coordinate every aspect of the undertaking. We offer full capabilities in project and infrastructure finance, including capital market access, real estate, environmental and tax law. This mix allows us to successfully design alternative financial/legal structures, draft financing models and project documents, and manage transactions effectively. We also perform diligence and coordination functions in projects from early development and construction planning phases to the later phases involving turnkey startup and operation. Our experience encompasses natural gas plants and pipelines, hydroelectric plants, and renewable biomass and biomethane installations.

Derivatives Sophistication
Traders of put and call options that hedge against risk rely on Ungaretti & Harris for guidance in structuring sophisticated transactions. Whatever exchange you trade on – New York Mercantile, Chicago Mercantile, Chicago Board of Trade – you can turn to us for help with documentation and analysis of the legal issues surrounding credit derivatives, OTC options, swaps, collars and similar instruments. We advise energy companies on derivatives involving natural gas, oil and electricity, and borrowers, lenders and investment banks regarding interest rate and foreign exchange derivatives including interest rate swaps on tax-exempt bonds.

Restructuring & Distressed Debt Transactions
Our attorneys assist clients on matters and transactions that involve bankruptcy or insolvency issues, in- and out-of-court restructurings, workouts, and buying and selling distressed assets. We have extensive knowledge of insolvency, bankruptcy, private equity, corporate, pension and tax issues that often arise in a distressed scenario. Our Finance and Restructuring group includes attorneys that have traditional M&A and bankruptcy/reorganization experience as well as hands-on client-side experience. In addition to financial institutions and other commercial lenders, we represent private equity funds, borrowers, lenders, individual creditors, distressed debt traders, directors, shareholders, bondholders, management teams and key employees from companies in a broad range of industries.

Because our firm offers a full range of business practice areas, we assist our clients with virtually all tangential issues that can affect a distressed transaction or restructuring. These include negotiating key employment, retention and severance agreements in pre- and post-bankruptcy situations; advising clients on regulatory issues such as ERISA, environmental laws, tax issues, and antitrust considerations; and even arbitrating and mediating disputes between parties in distressed situations.

Bankruptcy
Our interdisciplinary team of bankruptcy, litigation and transactional lawyers can create and implement practical recovery strategies for secured lenders, lessors and other creditors. With strong experience in both large and small cases, we understand the perspective of the key players in bankruptcies, including the debtor, the committee and the trustee, and can help you efficiently navigate all the competing interests in a bankruptcy reorganization or liquidation case.

Because we have a wide variety of experience representing secured lenders, lessors, creditors’ committees, insurers, management companies and trade creditors, clients rely on us to help navigate complex insolvency situations, even if we are not involved initially in their financing or restructuring transactions. We also handle representation of routine trade creditor claims which may require analysis, risk assessments or active representation in the bankruptcy and reorganization context, including litigation of disputes such as fraudulent conveyances and preferences; setoffs and other motions for relief from the automatic stay; valuation disputes; claim objections; executory contract and unexpired lease issues; and violations of the automatic stay and plan injunctions.

Financial Fraud and White-Collar Issues
Insolvency situations often involve accusations of fraud or other financial misconduct. We have seasoned litigation partners who have held high-level positions in the U.S. Attorney’s Office and Illinois Attorney General’s Office and have extensive experience in fraud investigations, pursuit of undisclosed or hidden assets, and civil or criminal proceedings involving allegations of financial wrongdoings. We represent government agencies, individual financial institutions and lender syndicates, creditors’ committee and even directors or officers who have been accused of misconduct or who are attempting to make restitution. Even when our client is not directly involved as a victim or defendant in such cases, our unique level of experience in understanding and assessing these matters can sometimes be important to third parties in developing recovery strategies.