How should a chapter 11 debtor’s financial information be presented to the bankruptcy court to create the best first impression? To give the court an accurate picture of the results of operations during Chapter 11 and for the...more
The issue of venue reform has been debated for many years and is again being revisited in light of the expected surge in bankruptcy cases in the wake of the COVID-19 pandemic and certain recent large Chapter 11 filings,...more
The pandemic has hurt many companies. Fortunately, at the urging of the Federal government and with relief from regulators, many secured lenders have refrained from taking action against borrowers in default under the terms...more
As we enter year two of the COVID-19 pandemic, the number of new Chapter 11 cases being commenced has slowed to a trickle. But the cycle will turn again. There are always companies that lose a major customer, fail to adapt to...more
In spring 2020, the CARES Act placed a partial moratorium on residential evictions across the country. The order prohibited residential landlords nationwide from evicting certain tenants. On Sept. 1, 2020, the Centers for...more
7/15/2021
/ CARES Act ,
Centers for Disease Control and Prevention (CDC) ,
Chapter 11 ,
Coronavirus/COVID-19 ,
Eviction ,
Landlords ,
Moratorium ,
Rental Income ,
SCOTUS ,
Small Business Reorganization Act of 2019 (SBRA) ,
U.S. Treasury
With Covid-19 wreaking havoc on global supply chains, vendors continue to face some difficult choices. Modifying the credit terms of contracts with struggling customers and even withholding credit is probably prudent. It’s...more
It has been quite the year. We are experiencing a once-in-a-lifetime economic recession as a result of a pandemic, and we are not done yet. There appears to be a time lag between the pandemic and its fully felt impact on real...more
5/3/2021
/ Bankruptcy Court ,
Brick-and-Mortar Stores ,
Business Closures ,
Coronavirus/COVID-19 ,
Debtors ,
Equitable Relief ,
Federal Reserve ,
Foreclosure ,
Hedge Funds ,
Private Equity Funds ,
Real Estate Market ,
Remote Working ,
Restructuring
Borrowers should not be surprised when their lender requests a “checkup,” financial review, or audit.
Lenders are nervous. Despite long-term institutional relationships with customers, many banks are seeking to reduce...more
8/12/2020
/ Audits ,
Banking Sector ,
Banks ,
Borrowers ,
Chapter 11 ,
Collateral ,
Coronavirus/COVID-19 ,
Financial Institutions ,
Financial Planning ,
Forbearance Agreements ,
Hospitality Industry ,
Insolvency ,
Lenders ,
Loans ,
Perfected Security Interest ,
Risk Assessment
What makes the current economic crisis unique is that it is systemic. Despite businesses historically being well managed, not being overly leveraged, innovating in the marketplace and not facing a large litigation judgment,...more
With COVID-19 having shut down many businesses, lenders increasingly are worried about their borrowers’ ability to repay loans. Lenders are concerned about the value of their collateral because of the loss of the spring...more
6/11/2020
/ Borrowers ,
Collateral ,
Coronavirus/COVID-19 ,
Financial Distress ,
Lenders ,
Loan Agreements ,
Midsize and Large Business Loans ,
Participation Agreements ,
Recharacterization ,
Small Business Loans ,
Subordination
One well-known and painful irony of COVID-19 is that many hospitals across America are struggling, even as healthcare has arguably never been more important.
These hospitals face an array of problems — from a reduction in...more
The Federal bank regulators which supervise banks have made a statement encouraging workouts necessitated by the coronavirus. Loans which would otherwise be classified as TDRs (Troubled Loan Restructurings) will not have to...more
Periods of uncertainty and distress create many questions that businesses must answer. Will they have the human resources and materials with which to produce goods and perform services for your customers? Will their customers...more
Now is the time to be extra vigilant and to carefully watch over the creditworthiness of your customers. Assume that all of your customers are in, or soon will be in, financial distress. If they have not called you yet to...more
A consequence of the COVID-19 pandemic is that many companies are unable to operate their businesses partially or completely. As a result, they have been compelled to seek relief from their landlords, vendors and...more
Understanding the role of the chief restructuring officer has never been more important. Here’s what a CRO can and cannot do.
In recent years, chief restructuring officers (CROs) have increasingly been assigned to assist...more
Many borrowers already have drawn down much or all of their available credit line in order to have the liquidity to ride out the COVID19 pandemic. Other borrowers are contemplating doing the same.
It may be too late....more
With a host of commercial real estate owners likely to declare chapter 11 bankruptcy as a result of the coronavirus pandemic, organizations that lend to these companies should keep one thing in mind: bankruptcy court judges...more
The Covid-19 pandemic has shut down most of the economy and retailers are among the businesses that could be closed for months. Even when they reopen, they will have suffered devastating losses of revenue.
For most of...more
In this Client Alert series, Lowenstein’s Bankruptcy, Financial Reorganization & Creditors’ Rights Department will introduce the various restructuring tools available to help businesses avoid financial catastrophe in the...more
At the moment, the bankruptcy court may be an unfriendly place for impatient lenders.
As the United States and much of the world reel from the coronavirus pandemic, many businesses’ revenues have been shut off (or close to...more
4/7/2020
/ Borrowers ,
Chapter 11 ,
Commercial Bankruptcy ,
Coronavirus/COVID-19 ,
Creditors ,
Debtors ,
Financial Distress ,
Landlords ,
Lenders ,
Tenants ,
Unsecured Debt