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General Unsecured Creditor

Administrative expenses can qualify as priority claims for unsecured creditors. What are the 3 categories of expenses in chapter 11 bankruptcy cases?

Like a professional fee carve-out, secured creditors may also agree to a carve-out for unsecured creditors to appease the court and creditors’ committee.

Who makes the top of the list in the order of priority? See where you fall based on the absolute priority rule.

The bankruptcy claims are more than just the amount a creditor is owed. Make sure you protect your claim by filing early and amending as needed.

A Series on the ABCs of ABCs, Business Bankruptcy & Corporate Restructuring/Insolvency Since a judge presides over a chapter 11 proceeding, one might assume that a chapter 11 case is like any other commercial litigation matter, with one party on each side of the case: a plaintiff and a defendant. One would be wrong (Felix Unger taught us what happens when we “ass-u-me”). In this installment of our series on business bankruptcy, restructuring and insolvency, we look at debtors, chapter 11 trustees, types of creditors and other parties involved in […]

“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 going to happen to my outstanding receivable? Is the market primed for a downturn? How am I going to replace any lost business? These concerns are very real and require meaningful thought and discussion. However, solely focusing attention on the downside can prove short-sighted. There are incredible opportunities in bankruptcy […]

In the realm of lending, the perfected Uniform Commercial Code-1 (“UCC-1”) is the hallmark of security.  If a secured asset has value, and the liens are valid, what other issues are there to consider?  Well, in at least one instance, underlying intercompany notes were the issue.  And because of the nature of these notes, the perfected UCC-1 lost its shine. In a bankruptcy case filed in the 5th District, the U.S. Debtor parent company had a number of lending agreements with different banks.  Subsidiaries of the parent company, including foreign […]

A written tour of business bankruptcy and its alternatives. If you would like to read from the beginning, this series started here with a broad overview of business bankruptcy. Most recently, the series has focused on the automatic stay, where you can find the 30,000-foot view. Or you can find more specific treatment here, here and here. In this installment, we give a crash course from a particular perspective – the unsecured creditor. When a debtor files for bankruptcy, creditors hold different types of claims or interests against the debtor’s estate.  Generally, […]

A written tour of business bankruptcy and its alternatives A typical commercial litigation case involves a judge, a plaintiff, and a defendant. A typical commercial bankruptcy case also has a judge, but that’s about where the similarities stop. A typical commercial litigation case, you see, is a two-party dispute. A typical commercial bankruptcy case is anything but. Who are the parties? The company that files the bankruptcy is the debtor (once a chapter 11 petition is filed, the debtor is called the debtor-in-possession). And, a debtor can have any number of creditors, each […]

JPMorgan Chase & Co. and others (“JPM”) lent $1.5 billion to General Motors Corporation (“Old GM”) under a term loan agreement (the “Term Loan Agreement”).  JPM was the senior secured creditor of Old GM.  Old Gm went into chapter 11 bankruptcy.  Under the terms of the DIP financing approved by the bankruptcy court, proceeds of the DIP loan were used to pay $1.5 billion to JPM for its claims under the Term Loan Agreement.  The unsecured creditors committee formed in the Old GM chapter 11 case (the “Committee”) wants that […]