King & Spalding lawyers are helping Columbus, Ga.-based credit-card processor Total System Services Inc., or TSYS, charge up its bottom line in a $150.5 million joint venture with First National Bank of Omaha.

TSYS is buying 51 percent of First National Bank of Omaha’s merchant acquiring business, which, according to an 8-K filed with the Securities and Exchange Commission, the bank is expected to contribute via a series of structuring transactions to a newly formed Delaware limited liability company of First National Merchant Solutions.

King & Spalding Atlanta corporate partner John J. Kelley III, along with a team of attorneys from various offices, handled the deal. Kelley, through a spokesman, declined to comment. Other Atlanta lawyers on the deal include tax partner Donald P. Hensel, employment and benefits partner Susan Canter Reisner and intellectual property partner Scott W. Petty. First National Bank of Omaha, through a spokesman, declined to name its legal counsel.

The Omaha bank will retain a 49 percent ownership share and will contribute its acquisition business—which means it signs up merchants, providing them with point-of-sale equipment and processing their transactions—to TSYS’s existing third-party processing arm.

The deal, expected to close in April, also includes what amounts to a non-compete agreement. According to the 8-K, both parties have agreed, subject to some exceptions, not to acquire the equivalent of a financial interest in merchant customer contracts via U.S.-based businesses other than through the new Financial National Merchant Solutions entity.

In the 8-K, TSYS reported 2009 total revenue of $1.68 billion; the Omaha bank, which is a subsidiary of First National of Nebraska, reported that its merchant-processing division had $74 billion in sales last year, with net revenue of $93 million.

The latest move in CitiGroup’s series of divestments involves selling part of its Duluth, Ga.-based Primerica Inc. life insurance business to private equity firm Warburg Pincus & Co., with a little help from its lawyers at Rogers & Hardin.

Partners Steven E. Fox and Alan C. Leet represent CitiGroup and its affiliates, along with attorneys from Skadden, Arps, Slate, Meagher & Flom. Lawyers from Wachtell, Lipton, Rosen & Katz represent Warburg Pincus, and the underwriters are represented by a team from Cleary Gottlieb Steen & Hamilton.

Fox declined to comment because the companies are still in the midst of the registration process.

According to an amended registration statement filed March 2, as part of a reorganization, Primerica will issue shares of common stock and warrants to purchase more to a CitiGroup subsidiary, along with a $300 million note at an annual 5.5 percent interest rate due in 2015.

Warburg will receive an unspecified number of shares and warrants in a concurrent private sale at a 5 percent discount off current book value. The aggregate purchase price of the common stock and warrants can be as high as $230 million, with an option—available for seven years—to purchase additional shares at list price for up to $100 million, according to the SEC filing.

The deal will give Warburg board seats and a significant—though unspecified—share of the company, with no more than 35 percent of the voting power after the initial public offering. CitiGroup will retain the proceeds of the IPO and sale to Warburg.

Prior to the offering’s completion, the amended registration statement says, Primerica also will ink three reinsurance transactions with CitiGroup, ceding to the larger company the bulk of its life insurance policies in force at the end of 2009, along with about $4 billion in assets to support the liabilities that the CitiGroup reinsurers are assuming.

One motivator for the deal, according to the amended registration statement, is to reduce CitiGroup’s insurance exposure. CitiGroup already has segregated or sold off other non-core businesses such as its Smith Barney retail brokerage in an attempt to rebuild its finances in the wake of the economic downturn and a $45 billion loan from the U.S. government.

Swoozie’s Inc., the bankrupt Atlanta-based purveyor of paper products, party supplies and gifts, has found a stalking horse bidder which could purchase its assets at auction with a starting bid of $5.34 million.

The stalking horse, Newton, Mass.-based Hudson Capital Partners, is one of more than 40 strategic, going-concern and liquidation buyers—including Books-A-Million and Tiger Capital—that Swoozie’s courted in its search for a way out of its financial difficulties.

That’s according to recent filings in Swoozie’s Chapter 11 reorganization case in U.S. Bankruptcy Court for the Northern District of Georgia.

Swoozie’s, which lists debts between $10 million and $50 million and assets of less than $10 million, is represented by Dennis J. Connolly, Wendy R. Reiss, William S. Sugden and Sage M. Sigler at Alston & Bird. Hudson Capital is represented by J. Hayden Kepner Jr. at Scroggins & Williamson. 

Court documents show that Swoozie’s is slated to hold the auction on March 25. Time is of the essence, because U.S. Bankruptcy Judge C. Ray Mullins has approved up to $3.5 million in debtor-in-possession financing from Wells Fargo that matures on April 15. That loan is in default, according to court documents, if a sale hearing is not held by March 29.

Founded in 1999, Swoozie’s grew to 43 stores around the country, but got into trouble after it purchased 13 stationery-and-party-products stores known as Blue Tulip out of bankruptcy about a year ago. Swoozie’s predicted an additional $12.8 million in sales as a result of the acquisition—but actual sales came up more than $4 million short, according to bankruptcy filings. Then, a “seismic shift in the economy” and a delay in closing a $3.1 million loan from Wells Fargo, according to court documents, prompted the company to file for bankruptcy.

Court documents contemplate that other bidders may bump Hudson Capital out of the running in the proposed Section 363 sale. If that happens, an agency agreement provides for a $75,000 break-up fee.

Other lawyers involved in the deal include Darryl S. Laddin and Michael F. Holbein at Arnall Golden Gregory as counsel to the Official Committee of Unsecured Creditors; James S. Rankin Jr. at Parker, Hudson, Rainer & Dobbs for Wells Fargo; and Mark I Duedall at Hunton & Williams for interested parties Gordon Brothers Group and Gordon Brothers Retail Partners.

The case is In re: Swoozie’s Inc., No. 10-66316.

Are we entering a new evolutionary stage in deal structures? A post on the New York Times Deal Blog by University of Connecticut law professor Steven M. Davidoff answers that question in the affirmative, citing changes in reverse termination agreements. According to Davidoff, who cut his transactional teeth as a deal lawyer at Shearman & Sterling, the structure of acquisitions is changing in the post-economic-crisis world as targets seek to bind acquirers as tightly as possible so as to avoid the type of deal demise that decimates share prices, and acquirers take the opposite tack, arguing for maximum latitude to end agreements if their financing falls through. Check out his analysis at Post-Crisis, the Evolving Structure of Deals. What do you think?

Elizabeth H. Noe has a big job.

Last month, she became the leader of Paul, Hastings, Janofsky & Walker's firmwide corporate department, a move which puts her in charge of the equivalent of a large law firm. She's now responsible for about 400 lawyers in offices around the globe and the 10 practice areas in which they work, including mergers and acquisitions, capital markets and restructuring.

She'll also be at the forefront of strategic planning for her department, which sits squarely within a legal industry segment that, at firms nationwide, was hard hit by the faltering economy and strangled credit markets.

Despite the business community's woes last year, Noe, 45, said she sees ways for the corporate department to grow.

“There's certainly an opportunity, given our global reach, to take advantage of what's happening in Asia, where capital markets are much more active than they are in the U.S. right now,” she said.

She said she'll also be looking for ways to strengthen relationships with U.S.-based clients interested in expanding around the world, and to promote the work of the department's various practice areas, which include investment management, fund formation, private equity and project finance.

In addition, Noe will work on administrative matters such as the partners' retreat; interviewing potential lateral partners; the associate evaluation process; and reporting on partner performance to the committee that allocates the units that determine partner compensation.

Paul Hastings' firmwide chairman and managing partner, Seth M. Zachary and Greg Nitzkowski, respectively, appointed Noe to the post when the prior corporate department chairman, Los Angeles partner Robert A. Miller Jr., wanted to return to full-time law practice.

Noe, who spent five years serving as Miller's vice-chairwoman, said her predecessor usually spent as much as 1,000 hours a year managing the group.

“I will continue to maintain a full practice. I'm absolutely not cutting back on that,” she said. She explained that she'll be able to do that because practice group chairs are taking on more responsibility. “It's really a more collaborative position than a solo position,” she said.

The move makes Noe one of five department heads in the 18-office firm, and the only one based in Atlanta.

Her practice centers on securities, M&A, corporate finance and corporate governance, with deals in the past year that included a $225 million private offering for Yonkers Racing Corp.

This initial acquisition, lead by Womble partner John F. “Sandy” Smith, involved the purchase of Richmond, Ky.-based Specialized Technical Services Inc.

“At core, they're meter readers, and they have a staff of meter readers that they subcontract to gas companies,” Smith said. “Now they also can offer technology-enhanced meter readings.”

That, he explained, means that a utility truck can drive past a meter and read it via a radio signal, without the driver needing to stop or get out. Or, he said, some meters are equipped to send readings directly back to the company.

“Enhanced technology for the service industry is how an investment banker would describe it,” Smith said.

He said that Specialized Technology Services, or STS, employs several thousand permanent and contract workers, and its business touches on a number of legal areas that required eight specialized lawyers for discrete tasks to get the deal done.

“From a lawyer's point of view, it had a lot of different issues,” Smith said, listing labor and employment, litigation, regulatory and federal and state tax matters that had to be considered in order to get the deal done.

Terms of the deal were not disclosed. Smith said only that STS's revenue, pegged at $18.8 million in 2006 in an Inc. magazine ranking of the nation's fastest-growing private companies, was now higher. He pointed out that Navigation focuses on companies with revenue in the $20 million to $100 million range.

This is the third transaction Smith has done for Navigation in the past three or four months, including helping the private equity firm acquire an audio-visual sales and design company with senior and mezzanine loan facilities from Regions Bank, and follow-on financing through Peachtree Equity Partners.

James P. Smith, who became the Middle District of Georgia's newest bankruptcy judge on Feb. 22, said he first got a lead on his current job at a Super Bowl party two years ago.

At that party, he ran into Robert F. Hershner Jr., a Middle District bankruptcy judge who told Smith he was planning to retire soon. When Hershner submitted his letter of resignation, the 11th U.S. Circuit Court of Appeals, which is responsible for vetting and appointing bankruptcy judges, announced an opening. Smith filed an application for the post and got the job last month.

Hershner and Smith share a legal legacy of sorts. The two had both practiced law with Macon lawyer Jerome L. Kaplan, although at different times. Hershner left Kaplan's firm in 1980 to go on the bankruptcy bench; Smith joined that firm, then known as Kaplan & Thomason, a year later, right after getting his law and M.B.A. degrees from the University of Georgia.

In 1985, the firm became the Macon office of Arnall Golden Gregory, where Smith said he spent 20 years handling business litigation and representing institutional creditors in bankruptcy matters. But in 2005, Arnall decided to close the office, and Smith, along with Kaplan and Ronald C. Thomason, joined former Arnall partner Ward Stone Jr., who'd left earlier to found his own firm, Stone & Baxter. At the smaller firm, Smith's practice became more focused on business debtors in Chapter 11 reorganizations.

Smith credits Kaplan with mentoring him and Hershner in their careers, calling his former colleague “the producer of bankruptcy judges.”

Smith's tenure as a bankruptcy judge really began on Monday, when he heard his first cases. Asked how things were going so far, he quipped, “Well, nobody's died yet.”