Troubled companies often perceive bankruptcy as the only way to address their problems. However, savvy insolvency professionals know that alternatives, such as Uniform Commercial Code (UCC) Article 9 sales, assignments for the benefit of creditors (ABCs), compositions, and statutory dissolutions,...
For a distressed company running low on capital, an investment from insiders may represent a last best hope for survival. Insiders may be willing to risk throwing good money after bad for a chance to save the company even when any third party would stay safely away. Insiders of a failing company...
Directors of Australian companies face some of the world's harshest penalties for continuing to trade a company while that company is insolvent. 1 These penalties include civil liability of up to AU$200,000 (more than US$150,000), unlimited compensation penalties, and even criminal charges carrying...
In most Chapter 11 cases, the debtor’s ultimate goal is to propose and confirm a Chapter 11 plan. While this is easier said than done, many Chapter 11 plans are typically the product of protracted negotiations among the debtor, its lender(s), trade creditors, and other interested parties. The...
The last several years have yielded some interesting, and not always pleasant, surprises for private equity sponsors and restructuring professionals looking to pursue out-of-court restructurings in the face of significant financial constraints. Challenges to asset transfers, debt exchanges, and...
A dispute arising from the bankruptcy cases of Sports Authority Holdings Inc. highlights an issue that could be at the forefront of upcoming retail bankruptcies and should always be considered by parties with credit exposure to distressed retailers. The dispute centered on the competing claims of...
Defaults in the second quarter of 2016 were $35.51 billion, resulting in a quarterly dollar-denominated high-yield bond default rate of 2.14 percent, the highest quarterly default rate since the fourth quarter of 2009 (2.57 percent). For the fourth quarter in a row, the quarterly default rate was...
U.S. Bankruptcy Judge Shelley Chapman of the Southern District of New York issued a bench decision on March 8, 2016, in the Chapter 11 cases of Sabine Oil & Gas Corporation (Case No. 15-11835), authorizing the debtors to reject certain executory contracts between (i) Sabine and Nordheim Eagle...
