Recently I had an opportunity to prepare an article on renegotiating and managing contracts when markets turn sour for the quarterly newsletter of the Arizona Chapter of the Association of Corporate Counsel. The newsletter includes several pieces of good advice for troubled times.
Today we begin presenting a regular monthly update on recent developments affecting M&A and divestiture transactions prepared with my colleague Robert Brown for Thomson Reuters/Westlaw.
In my last report I provided a brief introduction to organizational design, a discipline that is concerned with the factors and issues that must be considered, and the rules and processes that must be implemented, with respect to the design, development, implementation and maintenance of a successful and effective organization. This week I've attached an organizational design checklist that includes some of the key questions that a designer needs to ask when evaluating the strategy, structure, processes, rewards and people associated with an organization to ensure that they are properly aligned for success!
In my last post I provided a report that discussed the issues that arise when negotiating and finalizing a forbearance agreement. This week I’ve attached a model form of forbearance agreement that can be used as a reference for these types of arrangements. The summary to the form highlights the key issues that need to be considered in the drafting process including the length of the forbearance, modifications to the underlying credit arrangements and covenants from the borrower as to actions it will take during the forbearance period to keep the lender informed and cure the causes of the default that led to the agreement in the first place.
An organization does not simply appear on its own; in fact, organizations are contrived social systems that are created by groups of like-minded persons in order to pursue and achieve a stated goal or purpose. In this report I provide a brief introduction to organizational design, a discipline that is concerned with the factors and issues that must be considered, and the rules and processes that must be implemented, with respect to the design, development, implementation and maintenance of a successful and effective organization.
While the parties to any credit arrangement certainly anticipate that the borrower will fulfill its obligations with respect to timely repayment of amounts borrowed under the credit agreement and compliance with the various covenents and conditions included in the credit agreement it is not uncommon for problems to arise during the course of the relationship that lead to the borrower being in default. At that point the the lender can obviously exercise its rights and remedies under the law including foreclosure and other legal actions; however, another alternative is for the lender to refrain, or forbear, from exercising its rights for a specified period of time to allow the borrower to fix any problems that may have led to the default. The attached report discusses the issues that arise when negotiating and finalizing a forbearance agreement. In my next post I’ll provide a model form of forbearance agreement.