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Most Recent Articles About Restructuring, Insolvency & Vulture Investing:

90 Second Lesson: How to assess whether a distressed business can be turned around?By The DailyDAC Editors • 02/15/2019
QUESTION: Bill H., a business consultant in NYC, asks, how do I determine if a business I am being asked to help is just too far gone to save? ANSWER: Bill, if you have to ask this question, you might[...]
Considerations When Selling a Bankruptcy ClaimBy Christopher M. Cahill • 02/12/2019
One of your customers sends you notice it has filed for chapter 7 or chapter 11 bankruptcy protection rather than the payment for goods or services provided that you were expecting. You understand that you now have a “claim” against[...]
What do Secured Lenders Want? The Basics of Loan Forbearance AgreementsBy Robert D. Leavitt • 02/01/2019
When a borrower defaults on its loan agreements,[i] a lender may, among other options, sue to foreclose on its collateral and collect from the borrower. The lender, however, may instead agree to amend the loan documents or enter into a[...]
When Your IP Licensor Files for BankruptcyBy Jonathan Guy • 01/29/2019
How to Protect Your IP License Rights In 1888 – yes 1888 – Kodak coined the slogan: “You press the button, we do the rest.” The company, which was immortalized in Paul Simon’s song “Kodachrome1”, sold its assets – at[...]
When Your Borrower Files for Bankruptcy (DIP Financing, Cash Collateral, and Adequate Protection)By Michael P. Richman • 01/10/2019
What you need to know as a secured lender to a borrower who goes into bankruptcy you should know already, well in advance. If your borrower’s bankruptcy filing has taken you by surprise, please refer to my next article in[...]
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
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 lover after learning about the bankruptcy of your once devoted business companion. Despite the promises[...]
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[...]
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