As a faster and lower cost alternative to filing a Chapter 11, companies that are severely underperforming and distressed are often put in the hands of an independent fiduciary in a Receivership or ABC (Assignment for the Benefit of the Creditors) to sell the company in an “asset sale” or to liquidate the company. Receiverships can be either in State Court or Federal Court depending on the specific circumstances of a case.Bankruptcy Process Management:
Chapter 11 imposes a great degree of additional financial reporting and information disclosure stress on a company’s financial staff. The workload can be very heavy especially right before the filing of Chapter 11 and the few months after the filing. Having an experienced team managing this process working alongside the company’s financial team ensures these important tasks get done correctly and timely.Business Wind Downs:
The wind down and liquidation of a company can be surprisingly complex. All assets need to be identified, safe guarded and liquidated for reasonable value in usually a short time frame. Expenses need to be minimized and certain employees need to be retained and financially incentivized to assist in the liquidation process. Liquidations can be done in some type of legal proceeding or out of court depending on the situation.Fiduciary roles:
Liquidating Trustee services often involve roles after the core Chapter 11 proceeding is completed where the remaining bankruptcy estate assets are put in a Trust for benefit of the company’s creditors. Additional fiduciary roles could be Trustee or Examiner or Fee Examiner all in a Chapter 11 case.