Recap of the 2022 Fall Annual Meeting and Education Conference (held October 20 & 21, 2022)
Prepared by Andy Christianson (Reinhart Boerner Van Deuren)
This year’s ACIC Fall Annual Meeting and Education Conference was held at the Boston Marriott Long Wharf, simulcast on the Whova platform for remote attendees, and co-chaired by Jennifer Fitzpatrick (Pacific Life Insurance Company) and David Simonds (Hogan Lovells). The two-day Conference, themed “Art Imitates (ACIC) Life”, included nine sessions, each of which was tied to a movie set in or around the Boston area.
Thank you to all those whose efforts made this year’s event great, including ACIC staff, the co-chairs, our moderators and panelists, and the Education Committee members.
Welcome and Introduction / Announcements
Day one began with a welcome to in person and virtual attendees, a preview of the Conference, a discussion of the theme and announcements from Executive Director C.J. Marchain and the co-chairs.
Outgoing President Chris Dallas (Pacific Life) opened the Annual Meeting and gave an overview of College’s previous year. After hearing reports from the Treasurer, Membership Committee and Nominating Committee, the new officer and trustee slates were introduced and ratified, and three new trustees were welcomed: Jenna Jenson (Thrivent), Kevin Knohl (ArentFox Schiff) and Kate Lindsay (MetLife). The meeting concluded with Renée Dailey (Akin Gump) becoming chair as the new President of the ACIC and thanking Chris for his service as President. The January 2023 edition of Private Notes will include Renée’s thoughts on the year ahead and additional information about our new trustees.
Session 1: The Perfect Storm – Market and Regulatory Update
In the first session of the Conference, speakers Alexis Guinan (Akin Gump), Brian Keating (Guardian) and Jennifer Tippins (Citi) provided a market and regulatory update. The market update noted that 2022 demand to date has outpaced supply, with increases in issuance volumes, transaction sizes and new entrants into the market. However, public market volatility and other recent market factors have created uncertainty and a potential pullback. The panel then discussed sanctions matters and how to best conduct diligence and build in contractual protections. In particular, the Russia-Ukraine conflict has increased the focus on US sanctions related to direct and indirect investments, involvement by sanctioned persons, and the “new investment” ban. Finally, the regulatory update focused on the bond definition project and the role of rating agencies. Chris Dallas (Pacific Life) moderated the session.
Session 2: Gone Baby Gone – Structured Private Placements: Overview and Practical Insights
In the second session of the Conference, speakers Brian Keating (Guardian), Anna Pinedo (Mayer Brown), Mike Robson (Greenberg Traurig) and Sanjay Yodh (Monroe Capital Partners) discussed structured private assets. The panel noted that investor desire for higher returns has resulted in more creative transaction structures, the proliferation of deal sweeteners and more complex transactions. The panel gave an overview of risk-based capital (“RBC”) requirements and how more complex transactions can impact and be impacted by RBC concerns. Then, the panel highlighted areas of focus for regulators, including a detailed discussion of the proposed principles-based bond definitions for key terms. Finally, the panel gave an overview of certain capital efficient structures, including private equity/debt funds, collateralized fund obligations, collateralized loan obligations for private credit and specialty finance securitizations. Alfredo Cantoral (American Equity Life) moderated the session.
Session 3: The Verdict – Substance Abuse and Mental Health: The Unique Challenges of the Legal Profession – Ethics
In the third session of the Conference, speaker David Mann (The Other Bar) presented on substance abuse and recovery. David discussed the qualities of the legal profession and the personality traits of attorneys that often combine to make addiction more prevalent and more difficult to treat in lawyers and shared his personal journey into and out of addiction. David highlighted his work with The Other Bar, which is a California-based network of recovering lawyers, law students and judges dedicated to assisting others within the legal profession who are suffering from substance abuse problems. Sarah Olson (Thrivent) moderated the session.
Session 4: Knives Out – Anatomy of “Liability Management” Transactions / Creditor-on-Creditor Violence
In the fourth session of the Conference, speakers Tim Gravely (Aquiline Capital Partners), Margaret Parker-Yavuz (Akin Gump) and Eric Winthrop (Houlihan Lokey) discussed liability management transactions. The panel noted how the market has grown for these types of transactions have evolved over a short period of time and gave an overview of why and how creditors and sponsored issuers might consider entering a liability management transaction and their typical structures. The panelists gave insights into their personal experiences with liability management transactions and the practical steps involved therein. The panel also discussed the interplay between liability management transactions and the ACIC form documents, and where the current form documents do and do not adequately address liability management transaction related concerns. Matthew Schernecke (Hogan Lovells) moderated the session.
Session 5: 21 – “Know When to Hold ‘Em, Know When to Fold ‘Em”: Lessons in Ethics from Caesar’s Entertainment’s “Liability Management” Transactions
In the fifth session of the Conference, a spiritual sequel to the prior panel, speakers Nicole Greenblatt (Kirkland & Ellis), Sujeet Indap (Co-Author of “The Caesars Palace Coup”), Jim Millar (Faegre Drinker Biddle & Reath) and Jason New (NovaWulf Digital Management) explored liability management, corporate governance matters, bankruptcy and litigation proceedings related to the Caesar’s Entertainment’s restructuring. As counsel to Caesar’s, counsel to certain creditors, and co-authors of the book, the panelists each shared their personal insights into the transactions, the ethical concerns related thereto, and the practical lessons creditors, issuers and other interested parties can learn from Caesar’s. Max Frumes (Co-Author of “The Caesars Palace Coup”) moderated the session.
Session 6: The Social Network – Cryptocurrency, NFTs and other Digital Assets
In the sixth session of the Conference and final session of day one, speakers Sandra M. Rocks (Cleary Gottlieb), Elizabeth Schubert (Sidley Austin) and Edwin Smith (Morgan Lewis) discussed recent UCC amendments related to cryptocurrencies and digital assets. The panel delved issues arising in buy-side scenarios involving cryptocurrency and other digital assets in the context of current practice, and the rationale for and details related to the 2022 amendments to Articles 8 and 12 of the UCC. The panel also discussed how the NAIC views cryptocurrency, how this could impact the private placement market as issuer assets increasingly transition from physical to virtual and recent bankruptcy trends related to cryptocurrencies and digital assets. Charles Calloway Jr. (Chapman and Cutler) moderated the session.
Following day one’s sessions, attendees were able to meet for a well-earned reception. This year’s reception was held in Marriott’s Harbor View Ballroom, which is a beautiful indoor/outdoor space overlooking Boston’s Long Wharf and Main Channel. The reception also included heavy hors d’oeuvres and cocktail for attendees to enjoy while catching up and enjoying the view.
Session 7: The Town – Alternative Ways to Source Investments
In the seventh session of the Conference, speakers Greg Addicks (Voya), Laura Albrecht (Maranon) and Angus Whelchel (Moelis) discussed alternative ways to source investments. The panel discussed various sources for investments, including direct calling, club participation, sourcing from agents and investing in funds, and the potential risks and benefits related to each source. The panel then gave practical advice on how the applicable source of the investment can impact the role and responsibilities of the deal lawyer for diligence, documentation, post-closing matters and potential workouts. Melody Cross (Prudential) moderated the session.
Section 8: Good Will Hunting – ESG
In the eighth session of the Conference, speakers Sukhvir Basran (Hogan Lovells), Allan Marks (Milbank) and Liz Thorne (SLC Management) provided an update on the current ESG bond market. The panel first gave an overview of the types of ESG bonds, their relative pricing and volume, and how ESG bond status is achieved under applicable principles, guidelines, and US and EU regulations. Then panel discussed how key performance indicators, and related reporting and verification matters, can be addressed in ESG-debt documentation. The panel also explored how investors are addressing their own evolving diligence, monitoring, and reporting requirements related to ESG matters, and where the future of ESG investing may be heading. Brenda Page (The Hartford Financial Services Group) moderated the session.
Section 9: The Langoliers – Aircraft Financing
In the ninth and final session of the Conference, speakers David Botter (Akin Gump), Mehtap Cevher Conti (Hogan Lovells) and Ginger Hughes (Seabury) discussed the aircraft financing market. The panel first reviewed various aviation financing structures and new products that have been implemented in the market. The panel then highlighted perfection issues related to US and non-US markets, including a discussion of the Cape Town Convention and Protocol. The panel also provided an update on the aviation market related to airlines and lessors. Jasmine Ball (Debevoise) moderated the session.
The co-chairs announced that Lisa Spillman (Jerde Spillman) won the Whova platform participation award and Edward Poulsen (Athene) won the perfect attendance award. The co-chairs then concluded the conference by giving thanks to all attendees, panelists, moderators and ACIC staff.
Please save the date for the 2023 Spring Investment Forum to be held in Chicago on April 27 & 28, 2023.