Mezzanine Loan Foreclosure in Real Estate Transactions

Protecting Borrowers' and Lenders' Interests Under UCC Article 9

Recording of a 90-minute CLE webinar with Q&A


Conducted on Thursday, October 25, 2012

Recorded event now available

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Program Materials

This CLE webinar will provide guidance for counsel to real estate borrowers and lenders facing a mezzanine loan foreclosure under Article 9 of the Uniform Commercial Code (UCC). The panel will outline best practices for lenders to carry out a UCC foreclosure.

Description

Mezzanine lenders face a multitude of issues when seeking to foreclose on equity interests securing a mezzanine loan. Similarly, mezzanine borrowers must make several strategic decisions when facing a lender’s post-default enforcement of a mezzanine loan.

Unlike traditional mortgage loans, UCC Article 9 governs mezzanine loans. The UCC foreclosure process contains potential pitfalls and grey areas. However, with careful planning counsel can address legal concerns and minimize risks.

Listen as our authoritative panel addresses key legal issues for borrowers and lenders facing a mezzanine loan foreclosure under UCC Article 9 and provides best practices to effectuate a UCC foreclosure. The panel will also discuss bankruptcy considerations that affect borrower and lender strategies when a mezzanine loan goes into default.

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Outline

  1. Business and legal considerations
    1. Business review
    2. Real estate due diligence
    3. Legal review
  2. Foreclosure by sale
    1. Basic rules
    2. Public vs. private sale
    3. Mechanics of the foreclosure process
    4. Traps for the unwary
    5. Borrower and guarantor responses to lender actions
  3. Strict foreclosure
    1. Nature of the remedy
    2. Strict foreclosure mechanics
    3. Potential problems
  4. Bankruptcy issues
    1. Joint administration
    2. Dismissal of bad faith filings
    3. Lift stay motions
    4. Substantive consolidation
    5. Other bankruptcy issues

Benefits

The panel will review these and other key questions:

  • What protections does UCC Article 9 afford mezzanine borrowers facing loan foreclosure?
  • How should intercreditor agreements be structured to best protect the interests of mezzanine lenders?
  • What strategies should mezzanine lenders and borrowers use to effectuate a smooth UCC foreclosure?
  • What bankruptcy considerations come into play when a mezzanine loan goes into default?

Following the speaker presentations, you'll have an opportunity to get answers to your specific questions during the interactive Q&A.

Faculty

Gary Zimmerman
Gary Zimmerman
Senior VP UCC Division
Fidelity National Financial

He supervises and coordinates the underwriting, policy and production personnel and functions for the company's...  |  Read More

Stephen Bobo
Stephen Bobo

Partner
Reed Smith

He practices in the area of commercial restructuring & bankruptcy, focusing on bankruptcy and workout matters,...  |  Read More

Cochran, James S.
James Cochran

Partner
O'Connor Cochran

Mr. Cochran has extensive experience advising clients in workouts and restructurings involving complex collateral...  |  Read More

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