Bankruptcy, Distressed Debt, & Restructuring
Out-of-Court Restructurings / Prepackaged & Prearranged Chapter 11 Cases
When financial distress threatens, the cost of formal reorganization proceedings can potentially outweigh the benefits of a formal restructuring process. Our attorneys are adept at finding solutions without—or at least minimizing—court involvement. A financially troubled corporation that needs to restructure its debt may be better off—in terms of cost and time—doing so outside of bankruptcy. In a non-bankruptcy workout, a company negotiates changes to the corporation’s capital structure to more closely reflect current and projected asset values and cash flows. Workouts potentially reduce management distraction, eliminate substantial administrative expenses, and preserve asset values.
When a workout is not achievable—particularly for companies with complex or publicly-held debt—a prepackaged or prearranged Chapter 11 filing may offer the best path forward. In a “pre-pack,” the plan of reorganization is voted on and accepted by impaired creditors before the bankruptcy filing, minimizing disruption to employees, vendors, and customers.
CM Law’s attorneys guide clients through every stage—from initial creditor negotiations through plan confirmation—working collaboratively to reduce administrative costs, avoid distracting side battles, and deliver a faster, more certain outcome.
