Seth Kleinman

Aug 30, 2023 | jdsupra.com | Seth Kleinman |Miranda Russell

In Kirschner, the Court of Appeals for the Second Circuit unanimously affirmed a district court order that held that notes evidencing term loans were not securities but rather “[l]oans issued by banks for commercial purposes.” [1] In the underlying matter, the District Court for the Southern District of New York dismissed a plaintiff-trustee’s state-law securities claims for failing to plead facts to plausibly suggest that notes issued in connection with a syndicated loan facility were...

Mar 16, 2023 | jdsupra.com | Benjamin Butterfield |Theresa A. Foudy |Seth Kleinman

The FDIC receiverships of Silicon Valley Bank and Signature Bank have caused certain early-stage companies to face potentially crippling near-term liquidity issues. These liquidity issues may result in a company becoming insolvent. Therefore, boards of directors of such companies need to consider their fiduciary duties as well as steps that can be taken to mitigate risks. Fiduciary duties are typically owed to the company for the benefit of its owners.

Mar 14, 2023 | jdsupra.com | Benjamin Butterfield |Theresa A. Foudy |Seth Kleinman

The March 2023 banking crisis has been an unexpected “stress test” for dealing with liquidity issues. When state regulators closed Silicon Valley Bank this past Friday, many startups understandably faced severe liquidity issues triggered by the sudden and unexpected loss of access to their deposits. Fortunately, this crisis appears to have been averted.