The U.S. airline industry has been rocked by high fuel prices and decreased demand from business and pleasure travelers who are cutting back on spending during the recession.

Just this week, Delta Air Lines Inc. announced it would cut seating capacity by as much as 8 percent next year.

The airline industry’s woes, however, haven’t completely iced the market for the acquisition and leasing of new aircraft. Smith, Gambrell & Russell partner Don Mitchell last month advised a subsidiary of CIT Group Inc. on leasing two new aircraft to Compañía Mexicana de Aviación SA de CV, better known as the airline Mexicana.

Mexicana will lease from CIT Aerospace two Airbus A330-200s for 10 years each. Financial terms of the leases weren’t disclosed. The new planes will enable Mexicana to launch a new daily flight to Madrid from its hub airport in Mexico City, Mitchell said.

The two Airbus aircraft had originally been ordered by British carrier XL Airways. But that airline went bust in September, freeing up the two Airbus planes for another airline to lease. There was “significant interest” from other airlines in addition to Mexicana in leasing the planes, Mitchell said.

“The market is not robust, but there are opportunities,” Mitchell said.

While many U.S. airlines are shrinking their fleets, international airlines continue to take new deliveries, Mitchell said. Middle East airlines, such as Emirates Airline, are especially active in taking new deliveries, he said.

CIT Aerospace is leasing the planes to Mexicana through operating leases, an increasingly popular method of aircraft finance, Mitchell said. Before the market crash this fall, most airlines acquired planes aircraft through debt financing. But with financing now more difficult to obtain, operating leases are gaining in popularity, although primarily outside the U.S., Mitchell said.

As some large banks like BB&T, SunTrust and Fifth Third Bancorp accept funding from the U.S. Treasury Department to weather the credit crisis, smaller banks are taking different steps to bolster their financial position. In one such instance, Powell Goldstein counsel Lyn Schroeder [left] is advising a South Carolina community bank on its plan to take itself private.

First South Bancorp Inc. said in a regulatory filing that it plans to convert some of its publicly traded common stock to preferred stock. The company then plans to terminate its registration with the Securities and Exchange Commission. The moves will allow First South Bancorp to save money by avoiding the reporting requirements of the Securities Exchange Act of 1934. The company estimated it will save about $110,000 per year in management time, legal and accounting fees and other expenses.

The proposal requires the approval of First South Bancorp shareholders. First South Bancorp said it first began discussing a going-private transaction with Powell Goldstein in May, according to its proxy statement. It considered other alternatives, such as a reserve stock split, before decided to pursue the going-private deal.

First South Bancorp operates six locations of First South Bank in the Palmetto State—in the cities of Bluffton, Columbia, Greenville and Spartanburg.

King & Spalding partners Carolyn Alford in Atlanta and Angela Batterson in New York advised GE Capital Corp. on its role in restructuring a financing agreement for a company that offers telephone, cable TV and Internet service in rural areas.

Otelco Inc. increased the amount of its senior credit facility to $188.5 million to allow it to acquire certain subsidiaries of Country Road Communications LLC, allowing Otelco to expand in three states. GE Capital served as the agent, lead arranger and sole bookrunner on the restructuring of the credit facility.

After the Country Road acquisition closes, Oneonta, Ala.-based Otelco will offer its services in Alabama, Maine, Massachusetts, Missouri and West Virginia.

GE Capital Markets Inc. and CoBank of Denver were lead arrangers for the financing. Raymond James Bank, CIBC Inc., Union Bank of California and Webster Bank of Hartford, Conn. were the other lenders.

King & Spalding associates Oliver Drose and Mia Hahn also worked on the transaction. Dorsey & Whitney advised Otelco. Emmet, Marvin & Martin advised Webster Bank.

Three Morris, Manning & Martin lawyers advised apparel maker Boxercraft Inc. on a recapitalization.

MMM partners Sandy Smith and Bernard Coleman and associate Natasha Bell were counsel to Boxercraft, Smith said. Miller & Martin partner Jonathan Kent advised private equity fund River Associates Investments LLC of Chattanooga, Tenn., which provided the new financing. VRA Partners LLC of Atlanta was Boxercraft’s financial advisor. Terms of the recapitalization weren’t disclosed.

Boxercraft, of Atlanta, makes boxers, shorts, pants and shirts targeted to children and teenagers.

Truckers portray themselves as the last American cowboys. Apparently, trucking companies also think of themselves as mavericks, at least when it comes to hiring lawyers.

A large majority of motor-carrier companies in the U.S. flock not to New York or Washington when they need legal advice on corporate, insurance, regulatory and litigation-defense matters. Instead, they seek out two firms – one located in the Crossroads of America, and another located in the Great Plains.

“We’re in Indiana, which is called the Crossroads of America, and that’s an appropriate location for our law firm,” said Gregory M. Feary, managing partner of Scopelitis, Garvin, Light, Hanson & Feary. “More than 90 percent of our revenue comes from trucking companies. We have 22 practice areas and all devoted to their areas of law as they are applied to the trucking industry.”

Scopelitis Garvin employs 56 lawyers, most located in Indianapolis, but the firm also has offices in Chicago, Detroit, Kansas City, Los Angeles and Washington. Its clients include Schneider National Inc. of Green Bay, Wisc., the largest privately owned truckload carrier; and YRC Worldwide Inc., the parent company of Yellow Transportation and Roadway Express.

The other firm—Scudder Law Firm PC of Lincoln, Nebraska—is much smaller than Scopelitis Garvin but it also derives the bulk of its revenue from trucking companies. Scudder’s attorneys focus on mergers-and-acquisitions and securities work.

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Burr & Forman advised an Atlanta risk-management company on forming a strategic alliance with a New Jersey provider of data to the insurance industry.

Burr partners Deborah Franz [left] and Martin Tilson, both in Atlanta, were counsel to Ivox Corp. on the multimillion-dollar “strategic financing alliance” it formed with Insurance Services Office Inc. Additional terms of the agreement weren’t disclosed.

In addition to the financial investment, the two companies also expect to cooperate on research and new-product development.

Ivox, based in Atlanta, is engaged in the business of “assessing and managing risk in private and commercial fleets,” according to the company’s web site. Ivox’s customers are property and casualty insurance companies, and self-insured corporations owning and operating vehicle fleets.

Insurance Services Office, also known as ISO, provides statistical, actuarial and underwriting information for the property-casualty insurance and risk management industries. ISO is headquartered in Jersey City, N.J. McCarter & English advised ISO on the alliance with Ivox.

With the unprecedented upheaval in financial markets causing a near-lockdown in global credit markets, Deal Watch Blog called Chris Molen, a partner with Paul, Hastings, Janofsky & Walker in Atlanta, to discuss how the chaos on Wall Street is affecting corporate borrowers.

Molen advises clients on financing mergers and acquisitions, asset-based financing, cash flow lending, structured finance and restructuring senior debt financings. Molen’s clients have included Bank of America, Toronto-Dominion Bank, SunTrust Banks and Wells Fargo.

The conversation was edited for brevity and clarity.

Various news reports have said that the global credit markets have virtually locked down. Can you comment on what you’re seeing in the market—who can find financing and what lenders are providing credit right now?

The AAA investment-grade type companies can still find financing. I’m talking about long-term credit facilities of one year to five years, term loans of one year to seven years, your traditional corporate loans. Probably there are solid [privately held] companies with a long track record and who have a relationship with their lender; they may be able to find some financing.

What the big banks’ philosophy is right now is that the deal has got to be really solid from a credit perspective. A deal has also got to have the prospect for other fee opportunities—providing advice on future bond issues, or cash management, some other kind of fee income. A bank wants a customer whose credit is beyond reproach and for whom they might be able to pick up other fee-earning opportunities.

A couple of years ago, even five years ago, there was plenty of money chasing deals. Lenders—banks, hedge funds, others—were quite happy to simply make loans and not worry about other fee income. That’s not the case now.

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Some lawyer directories are more exclusive than others.

Consider that Super Lawyers features more than 200 mergers & acquisitions lawyers from Atlanta in its 2008 edition. The Chambers Guides lists more than 30 M&A lawyers from 16 Atlanta law firms. But the International Who’s Who of Merger & Acquisition Lawyers has picked only five.

The Who's Who lawyers are: Kilpatrick Stockton partner Stan Blackburn; King & Spalding partner Michael Egan; Paul, Hastings, Janofsky & Walker partner Walter Jospin; Sutherland partner Mark Kaufman; and Alston & Bird of counsel Sid Nurkin.

There are other differences between the publications. It’s possible for an attorney to purchase an advertisement in Key Professional Media Inc.’s Super Lawyers directory to call more attention to his listing. Who’s Who Legal and Chambers both say that lawyers cannot buy a listing in their guides.

The editors of the Who’s Who guide say that they compiled their listing by canvassing and analyzing the opinions of law firm clients and M&A lawyers “from around the world.” The Who’s Who guide is one of a series, organized by legal practice areas, published by Law Business Research Ltd. of London. The 2008 guide for M&A lawyers sells for 80 British pounds.

Lawyers from New York-based law firms are well represented in the Who’s Who guide, including Cravath, Swaine & Moore partner Richard Hall and Wachtell, Lipton, Rosen & Katz partner Martin Lipton. The Who’s Who guide culled names from most U.S. states, as well as from dozens of countries, including Australia, Canada, Germany, South Africa and the U.K.

With gas prices sky-high and credit extremely difficult to obtain, U.S. consumers have decided now isn’t a great time to be spending money on a new car. That’s meant big trouble for car dealers, especially retailers who sell the domestic brands General Motors, Ford and Chrysler.

As a result, dealerships are closing at a rapid rate in metro Atlanta and in the U.S. One lawyer predicts even more will close in the next 12 months to 18 months.

In the Wednesday issue of the Daily Report, corporate lawyers discuss the limited range of legal options available to the owners of struggling auto dealerships. Bankruptcy is rarely an option because of the difficulties in obtaining post-petition financing. It’s not easy to dispose of property, because a dealership’s real estate is often highly leveraged. And, other than publicly traded car dealership companies, there aren’t many dealers that have enough capital to finance an acquisition right now.

One lawyer is advising clients that if have ever seriously considered exiting the car-dealership business, now would be a great time to do so. Read about it here.

In one of his first acts as a Securities and Exchange Commission commissioner, former McKenna Long & Aldridge partner Luis Aguilar voted in favor of making it easier for U.S. investors to access information about foreign markets and companies.

The SEC voted to adopt a number of rules, including one to expand disclosures that foreign private firms provide to investors, Forbes reported. Another rule change would allow investors to use the Internet to access material documents belonging to a foreign private company.

“U.S. investors will have access to higher quality disclosures,” Aguilar said during an open SEC meeting, according to Forbes. Aguilar joined the SEC on July 31.

The commission voted unanimously in favor of the changes.