Corporate Governance in Distressed Situations
This panel focuses on different strategies sponsors are using to retain control (or at least put a stake through) the bankruptcy process. What are the risks to sponsors/litigation issues? The panelists also discuss fiduciary duties, managing conflicts and retaining separate counsel, the interplay between corporate governance and aggressive sponsor action (e.g., selling or spinning/stripping-off assets), sponsor affiliates purchasing debt in the portfolio company’s capital structure, and 10b-5 compliance, as well as negotiating/litigating with a difficult board. This session also includes a discussion of issues that arise when dealing with a challenging board of directors, especially those where some or all directors have been appointed by a controlling shareholder.