ACIC Private Notes Summer 2021 Edition: 2021 Spring Virtual Investment Forum Recap
By: Aaron Borden (Prudential Financial)
What a difference a year makes. This year’s ACIC Spring Investment Forum marked roughly the one year anniversary of the Covid-19 pandemic. A year ago, most of us were confronting a number of firsts — transitioning to a work-from-home regime, learning how to shelter in-place, grappling with social distancing guidelines, continually masking up, and determining whether this was the year to start baking bread or finally build that home gym. Recently, however, as we gathered for a second time to attend the ACIC conference virtually, much of last year’s dramatic firsts seemed to be slowly fading away. The United States and Canada have seen substantial improvement in their pandemic situation as the vaccine has continued to rollout in those two countries. Life has started to feel more normal once again, and optimism seems to be sweeping across the land, including along the economic landscape. Besides the pandemic, last year also witnessed an historic social justice movement, sparking much needed conversations on diversity and representation in the workplace, as well as profound economic hardship brought on by the pandemic. While there is reason for optimism on these fronts as well, this past year also showed us that we still have a way to go.
This year’s Spring 2021 conference touched on several of these very themes – optimism, normalcy, diversity, representation and economic challenges. The conference began and ended with optimism, discussing the positive outlook in the Latin American investment market and the U.S. energy market. Sprinkled in between were networking sessions on workplace diversity, as well as market updates illustrating certain economic challenges. This second virtual conference went off without a hitch, thanks to its co-chairs, moderators, panelists, organizing committee and administrators. The conference, along with the chocolate tasting event, provided topical panel discussions, and gave attendees an opportunity to connect with folks that they have been unable to see in person in over a year.
Six CLE sessions were presented through the Cvent online platform over two days, with 163 people in attendance. Sessions included live audience polling on a range of topics, allowing both panelists and attendees to track results in real-time. The live polling continued to enhance and enliven panel discussions. The conference’s theme was “Carpe Librum” (Seize the Book), which was fitting after a year in which many members had more time for pleasure reading and virtual book clubs. Once again, prizes were awarded to attendees based on their interactive participation on the virtual platform.
The conference co-chairs were Robin Lenarz (Securian) and Heather Wenzel (Morgan Lewis). The co-chairs, along with the ACIC administrators, deserve special thanks for making the conference both highly engaging and user-friendly, given the challenges of presenting through an online platform. By all accounts, the virtual conference was another ACIC success.
Wednesday, Day One
The day started with the formal kickoff to conference, which featured opening remarks and announcements from the President (Tina Smith), the Executive Director (C.J. Marchain) and the co-chairs. The remarks included emphasis from the President on encouraging diversity across the board at the ACIC, including on panels and committees. The Executive Director highlighted the new “networking” feature added to the virtual platform, and encouraged its use between sessions by offering prizes to those most utilizing the new feature. After announcements were finished, the conference then moved into the first session.
Session 1: Latin American Investments/Market Update. This session featured two distinct presentations – the first, a market update for private placement transactions, and the second, a discussion of investment structures in Latin American (LatAm). Scott Barnett (Prudential) moderated the entire session. After Scott’s introductory comments, Edward Reznik (Sumitomo) began with a market update. Ed noted both the human suffering brought on by the pandemic, as well as the optimism reflected in the second half of fiscal year 2020, which saw a considerable rebound in the U.S. private placement market. After Ed’s presentation, the session moved to the LatAm portion, which focused on demystifying transactions and legal issues surrounding structured securities and workouts in certain LatAm counties. The presentation covered a broad range of topics, including (i) key differences between the U.S. and LatAm financing regimes, (ii) future flow securitizations, and (iii) Mexican withholding tax credits. Presenters for this portion included Elicia Ling (Paul Hastings), Josh Winchester (Voya) and Margaret Parker-Yavuz (Akin Gump. The first session was followed by a short break.
Session 2: Generational Diversity in the Workplace. The second session featured an “ethics credit” topic on generational diversity in the workplace. The sole panelist was Chris DeSantis, an independent consultant who focuses on organizational behavior. Nicole Windsor (Chapman & Cutler) moderated the panel. Nicole opened the session with an overview of the generational makeup of today’s workforce, which is roughly evenly split among Baby Boomers, Gen X and Millennials. Chris then gave his presentation on generational diversity in the workplace. The presentation included colorful anecdotes and revealing data on the differing experiences and worldviews among the generations. Chris also underscored the strengths that each generation brings to the table at the workplace. The session concluded with a short Q&A from the audience. The session was followed by a virtual networking break, which featured guest speakers, Charles Calloway Jr. (Chapman & Cutler), Abhishek Gupta (BofA) and Noelle Sproul (Nuveen), who discussed their experiences participating in the industry group, DPPP (Diverse Professionals in Private Placements). Prior to the start of the third session, the co-chair, Heather Wenzel, conveyed the usual helpful reminders to attendees regarding CLE credits, and teed up the chocolate tasting event scheduled for the end of Day One.
Session 3: Wiring and Funding Process – Risks and Mitigants. The final session of the day focused on the nuts-and-bolts around the electronic wiring of money. The presentation began by explaining the mechanics and nuances of the electronic wire transfer system. This segment looked at both the macro and micro-perspectives of moving funds electronically, including the institutional checks-and-balances built into the process. Next, the panel focused on issues related to wire fraud, wire errors and increasing cyberthreats aimed at the wiring of funds. Real world examples were given of financial institutions whose wire systems have been hacked by cybercriminals in recent years, together with “best practices” adopted by institutions to mitigate the risks of such attacks. Brendan Kelly (NY Life) led the panel, which included Matthew Gabrys (Northwestern), James Tedman (ACA Aponix) and Michael Abatemarco (BNY Mellon).
Wednesday Chocolate Tasting Event
After the final session, many attendees were treated to a virtual chocolate tasting event. The event was hosted by Yelibelly Chocolates, who featured chocolates from six different countries of origin, as well as cacao beans, jellybeans, truffles and bonbons. Those who participated in the tasting event were pre-shipped their selected candy assortments, along with a tasting mat and journal sheet.
Thursday, Day Two
Thursday began with a virtual breakfast for new members and young lawyers. The breakfast was followed by some housekeeping reminders by the co-chair, Robin Lenarz, including an update on the networking game leaders and an announcement regarding the virtual yoga session. The yoga session, which was originally slated for Day One, was moved to Thursday afternoon after the final conference session.
Session 4: Sports Financing. Following the breakfast, the attendees watched a fascinating and detailed presentation on professional sports deal structures, including individual team financing, league-wide financing, league-level financing and stadium financing. The presentation started with a market update on the state of professional sports, from the beginning of the pandemic to the present. Stacy Sonnenberg (Goldman Sachs) led this discussion. She began by painting an ominous picture of the state of professional sports at the start of the pandemic, noting that many teams lost somewhere between a third to two-thirds of their revenues. She further noted that private placement finance proved critical in saving professional sports by continuing to invest in sports across the spectrum during the pandemic. She concluded her remarks by observing numerous positive trends in sports finance, like the emergence of new players on the scene such as SPACs, private equity and gaming. Next, all of the panelists discussed individual team financing, focusing on the various financing structures and team assets. This discussion was then followed by a discussion on league-wide financing, both with and without a “true sale.” The panel then moved onto a discussion of stadium finance, highlighting the movement away from municipal ownership and public finance to private ownership and private finance. The session rounded out with a brief overview of league-level financings, followed by some live-polling questions and concluding remarks. The other featured panelists included Aron Davidowitz (NY Life), Tony Yager (Chapman & Cutler) and Sean Monahan (Choate Hall). Tony Lauro (Hartford) moderated the session. The fourth session was followed by a short break.
Session 5: Insider Trading: Perspectives from Across the Table. This fifth session was the flipside of a previous ACIC panel regarding insider trading. In the previous panel, we heard from a key insider-trading witness, Tom Hardin (also known as “Tipper X”), who proved instrumental in the federal government’s prosecution of several hedge fund insiders during the mid-2000s, including Galleon Group founder, Raj Rajarantnam. This time we heard from the other side of the table – top former federal prosecutor, David Miller (now at Green Traurig), who prosecuted cases involving “Tipper X.” David’s presentation gave a thorough lay-of-the-land of the complex and evolving nature of insider trading law. His unique perspective as a seasoned former prosecutor made the presentation especially riveting, given his ability to share key insights into successfully investigating and prosecuting high-profiles cases. David also delved into other important area such as investigative techniques, “best practices” for avoiding investigations, and future enforcement priorities. David’s colleague, Tammy Lam (Greenberg Traurig), moderated the session. The session was followed by a virtual networking break, which featured guest speakers, Laura Beebe (FBL Financial), Laura Sarlo (Liberty Mutual) and Sarah Marschok (Wellington Management), who discussed their experiences with another important industry group, IWIN (Insurance Women’s Investment Network).
Session 6: Energy Transactions – Legal and Commercial Issues. The final session of the conference was a broad discussion of the current state of the energy market. The panelists provided an overview of the sector, including a description of its players, regulated vs. deregulated utilities, the renewable energy space, ESG considerations, financing defaults, bankruptcy considerations and recent power outages. The session was moderated by Olamide Bello (Voya), and the panelists included Paul Caruso (Allstate), John Knox (Hartford), Michael Kizer (GLC Advisors) and Andrea Lucan (Allen & Overy).
The conference concluded with an announcement of prize winners and a virtual yoga session.
The 2021 Virtual Fall Annual Meeting and Education Conference is currently scheduled to take place, on October 13 and 14th. featuring relevant topics and networking opportunities! Details regarding specific panel topics and speakers are soon to follow so SAVE THE DATE!