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Most Recent Articles About Restructuring, Insolvency & Vulture Investing:

Managing Cash and Stakeholders to Turn Around a CompanyBy Steven A. San Filippo • 12/12/2018
Insufficient liquidity shrinks the range of options for a financially distressed business. The metaphor of a melting ice cube is often used to illustrate the situation. When the cash runs out and the company is unable to pay its employees or vendors, the ice cube has melted. The business has failed, and recoverable value has collapsed.
Valuation: The Pillar of Corporate RestructuringBy Jonathan Friedland • 12/07/2018
Bankruptcy Valuation Valuation—the estimation of an entity’s worth—plays a crucial role in all stages of a commercial bankruptcy, as well in any out-of-court restructuring.¹ Valuation can be critical at the beginning of a bankruptcy case in determining whether the debtor[...]
Cash is King – The Importance of Liquidity in a Distressed Company’s Capital StructureBy David Bagley • 11/28/2018
A company’s “capital structure” is the array of its liabilities and equity. Capital structure commonly consists of three main components: working capital (or operating debt), financing debt, and equity.
Opportunities in Bankruptcy: Turning Coal Into DiamondsBy Michael A. Brandess • 11/21/2018
“The time to buy is when there’s blood in the streets.” - Baron Rothschild Don’t Panic, There Are Many Opportunities in Bankruptcy When a client or a competitor files for bankruptcy, it is natural to reflect on the downside. What’s[...]
Review of the NAFER 2018 Annual Conference in ChicagoBy Christopher M. Cahill • 11/12/2018
NAFER (the National Association of Federal Equity Receivers) held another wisdom-rich conference in October, this time at the Drake Hotel in Chicago.  It was the seventh annual event and attracted 200 attendees. The conference included the Training Camp as well[...]
Absolute Priority Rule in Bankruptcy: Are You Atop the List?By Patrick Maxcy • 11/07/2018
Editor’s Note: This is an updated version of an article published in May of 2013. If you are a vendor, service provider or another unsecured creditor to a chapter 11 debtor, you cannot be blamed for feeling like a duped[...]
What Constitutes the “Legal Rate” in a Solvent Debtor Bankruptcy Case?By Melanie L. Cyganowski • 10/31/2018
Chapter 11 bankruptcies find the debtor generally to be insolvent, but not always. Occasionally, a debtor will emerge from the bankruptcy process as a solvent entity, and in those situations, Bankruptcy Code §726(a)(5) may entitle creditors of the debtor’s estate[...]
From Penthouse to Ground Floor – The Penthouse Magazine BankruptcyBy Michele Schechter • 10/26/2018
The Life, Death and Many Reincarnations of Penthouse Magazine Penthouse International, publisher of Penthouse Magazine, sold for $11.2 million in June. The company was worth about $700 million (adjusted for inflation) at its height. The latest Penthouse Magazine bankruptcy highlights just[...]
Lender Liability Is Alive and Well: A Case StudyBy Gary W. Marsh • 10/20/2018
The relationship between a lender and borrower can be complex. The borrower wants capital to run and grow its business and the lenders want to earn a return and eventually get its principal back. If the borrower complies with the[...]
Dealing with Distress for Fun & Profit— Installment #18—How to Confirm a Chapter 11 PlanBy Jonathan Friedland • 10/18/2018
A written tour of business bankruptcy and its alternatives. This is the latest in the series, Dealing with Distress for Fun & Profit, which you can read from the beginning if you like.  In this bat-installment, we turn to what[...]
Law Firm Bankruptcies: The “Unfinished Business” Doctrine and the Jewel WaiverBy Phillip D. Anker • 08/09/2018
One of the interesting aspects of business bankruptcy cases is that both the businesses and the issues their bankruptcy proceedings present can differ so much. In recent years, for example, we have seen department stores (Macy’s, Federated), toy retailers (Toys[...]
The Supreme Court Narrows the Bankruptcy Code Safe Harbor for Securities Transaction PaymentsBy Anna Kordas • 06/07/2018
In our last article, we discussed the U.S. Supreme Court’s acceptance for review of the Seventh Circuit’s decision in FTI Consulting, Inc. v. Merit Management Group, LP, 830 F.3d 690 (7th Cir. 2016), cert. granted, No. 16-784, 197 L. Ed.[...]
Timing Is Everything: How to Make a Rough Assessment of Potential Preference Action Defenses (PART 2)By Robert C. Maddox • 04/26/2018
Editor’s Note: Part 1 of this article laid out the prima facie case a plaintiff needs to have in order to sue for a preference, outlined the major defenses and explained the importance and use of certain key documents in[...]
Timing Is Everything: How to Make a Rough Assessment of Potential Preference Action Defenses (PART 1)By Robert C. Maddox • 04/23/2018
Your company has just been served with a preference complaint. The complaint seeks to recover tens or hundreds of thousands of dollars even though your company already has taken a loss on the debtor’s accounts. Your initial response is anger[...]
Long-Term Disruptive Trends: Installment #2 – Transportation Industry TrendsBy Todd A. Zoha • 03/10/2018
This article is the second in a series of articles discussing long-term disruptive trends and their impact on restructuring activity. Read Bankruptcy Venue Reform, the first installment of this series. Introduction to Disruptive Trends The English Oxford dictionary defines “disruption”[...]