The Troubled Company

Nightmare on “E” StreetMichael B. Cahill

City National Bank

Robert A. GreenfieldStutman, Treister & Glatt Professional Corporation

John A. O’MalleyFulbright & Jaworski L.L.P.

Gregg A. MatsonMcAndrews, Allen & Matson

• Just reached break even cash flow.

• Investors not prepared to put in new money.

• Proprietary products subject to license agreement.

• Wonderful domain name, registered trademark.

“ChipShot.com” is in trouble

• Public Company.

• Delinquent on payroll.

Pre-Petition Issues

• Departing employees non-compete/confidentiality.• Security Interests.• Board and management defecting.• Patent and Trademark Infringement Claims.

• Vendors worried. Some have filed lawsuits.

Pre-Petition Issues

• Potential buyers circling vulture capitalists as liquidators.

• Fiduciary Duties to be considered.

• D&O Liability/ENRON issues.

• Receivables based financing available?

• Assignment for benefit of creditors v. Chapter 11.

Post-Petition Issues

• Maximizing Net Value.

• Debtor-in-possession (“DIP”) financing and other “First Day” issues.

• Product availability.

• Operating in Bankruptcy.

• Rights of exclusive licensor.

• Potential plan structure.