Business Bankruptcy

• You are postponing bill payment because of cash flow.
• Vendors are altering the terms on which they deliver goods and services, including shortening credit terms or demanding cash on delivery.
• You have a large balloon payment due on a line of credit and you’re not sure you can refinance the debt
• You owe significant tax liabilities.
• Your landlord has sent you a threatening letter.
• You have received a collection letter.
• You are a party in extended litigation. This could be because:
  • You are owed money.
  • You cannot collect on royalty or licensing fees for your intellectual property.
  • You are involved in a class action suit of some description.
• The growth strategy you adopted successfully during good economic times requires a rate of expansion that you cannot support as your customer base contracts.

If you find yourself in one or more of these situations, it is a good idea to consult a restructuring professional right way. You actually have the greatest ability to control your own destiny while you are still making payments to your creditors. Many people mistakenly equate restructuring with bankruptcy. The truth is that this is just one option. A good restructuring professional can help you explore and select from a full range of strategies. These include:

• Negotiated restructuring. Your creditors are, in some measure, your business partners, and they will want you to succeed, provided you give them time to plan and room to maneuver. With a negotiated restructuring, you can change the payment rate and the amount of time you have to pay. Sometimes you can even reduce the principal.
• Sale of part or all of your business. This could be a good time to evaluate whether it’s time to get out of a portion of your business that has been less profitable for you – and that does not really play to your core strengths. You can use the proceeds from such a sale to pay off your creditors, invest in other aspects of your business, or fund a restructuring plan. The timing of this is very important; the longer you wait, the more the value of your business is likely to decline.
• Chapter 11 restructuring. For many businesses, this type of reorganization can provide a combination of the benefits offered by the other strategies. Once you have filed for Chapter 11, creditors must cease all collection efforts against you, but you can still operate your business. Chapter 11 buys you time to determine how you want to proceed, including deciding which parts of your business are and are not working, and developing strategies for avoiding what got you into the situation to begin with. You can also reject unprofitable contracts – such as leases, supply agreements and purchase agreements — that may have made sense when you signed them, but don’t meet your current needs. Chapter 11 has two other benefits that are often overlooked. First, all lawsuits and litigation against you anywhere in the U.S. are frozen. Second a Chapter 11 filing may entitle you to bring claims and litigation from a place selected by your creditor to the more favorable forum of a federal court.

Identifying and using the right strategy can make your balance sheet look better by getting rid of legacy debt. In the long run, this will make your company more attractive to operate and, if you chose, to sell.

Using a restructuring firm like Duffy & Atkins, allows you to do what you do best – run your business – and us to do what we do best – develop and implement a work-out strategy that meets your needs and goals. While you could try to simply pursue the strategies outlined above on your own, in many cases, you run the risk that things will not turn out to your best possible advantage. Also, most creditors are fairly sophisticated when it comes to people owing them money. They understand how the restructuring process works and what your options are.

With restructuring attorneys like Duffy & Atkins advocating for you, your position will receive more immediate, serious attention – and at a higher level – than most owners of small and mid-size businesses can obtain on their own. We accelerate access to key decision-makers, often gaining immediate access in situations where clients have struggled for months.

Of course, hiring a restructuring attorney also puts a wealth of expertise and a powerful negotiating team at your fingertips – and frees your time to focus on running your business.

Twenty years of experience has taught us a great deal about renegotiating debt in order keep businesses going. We move through matters quickly and efficiently, both to relieve our clients’ worries and to help them leverage their remaining assets as fully as possible.

We’re also smart about the value we provide our clients, keeping our overhead low and managing our cases resourcefully. When you’re under pressure to reorganize your finances, you need the best law firm you can find, but not necessarily the most expensive.

Contact Duffy and Atkins LLP today at 212.268.2685 or .