Nashville Post’s 2Q 2010 Bank Performance Summary
The Post came out with its quarterly summary of local bank performance today. http://bit.ly/p6iT21 (subscription required) The central premise of the piece is that “a closer look at the numbers and their trends show that clear camps are emerging.” The camps are “banks that have seemingly digested the worst of the downturn” and “institutions that are nowhere near over their indigestion.” This meshes pretty well with what we are seeing.
By Breadth and Priority of Security Interests in Inventory
In 1999, Jeff Tunstill applied for a loan at GE Commercial Distribution Finance Corporation (”CDF”) in order to start a business selling horse trailers. The security agreement he signed in connection with the loan included a broad after-acquired property clause. It granted CDF an interest in all Tunstill’s inventory, whether then-owned or later-acquired, and all proceeds from the inventory. Tunstill also borrowed funds from the Bank of Lincoln (”BLC”) for the purchase of used trailers, pledging the used trailers as collateral.
Cautionary Tale About Guaranties
In Crossville, Inc. v. Kemper Design Center, Inc., et al., 2010 WL 5158641, the U.S. District Court for the Middle District of Tennessee addressed two matters related to interpreting and applying personal guaranties of corporate debt. Each of the issues arose from the fact that personal guaranties were executed at the same time as a first set of loan documents, and none were executed with a second set of loan documents. The parties did not agree about whether the second set was a “modification” of the first set, or a new transaction altogether.
Is $#*! Hitting The Fan?
In 20 years of practicing law, I have never seen a year end this busy. We’ll have to wait to see how 2011 unfolds, but it looks like the much-talked about melt down of commercial lending might be kicking off.
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