Changes in customer demand, obsolete process or equipment, mounting legacy costs or environmental liabilities, protracted labor disputes, a shifting competitive dynamic, significant litigation – these and other factors can lead to recurring losses. If not properly addressed, these losses may soon place a business or a public entity in extremis.
Careful analysis and decisive action during the initial stage of the insolvency process can make an enormous amount of difference in the overall outcome. South Bay Law Firm will work closely with clients – and with our carefully selected restructuring and financing partners – to ultimately achieve optimal positioning in this crucial early stage.
Left unattended, what were initially perceived as manageable operating losses or other problems can cascade into chronic shortages of cash. This can cause a business or public entity to struggle in meeting payroll, debt, or other basic operating obligations.
To survive, management must immediately and effectively communicate with employees, creditors, and other interested parties – and be prepared to negotiate or to accept an objective, realistic plan for quickly resolving the cash shortage.
When a client must resolve a cash shortage, South Bay Law Firm can provide immediate advice based on an in-depth understanding of cash shortages and the legal backdrop against which restructuring negotiations typically occur.
Predictably, unresolved cash shortages lead to insolvency. When new funding or refinancing are not achievable – and when total assets are worth less than total liabilities – an insolvent entity must restructure.
This may be achieved through a comprehensive out-of-court workout or through the U.S. Bankruptcy Court. These are often welcome alternatives to liquidation. At this juncture, a client must make immediate decisions about the business’ viability and its best route to restructuring, and there is no margin for error.
South Bay Law Firm has extensive expertise in both judicial and non-judicial insolvency proceedings, and is able to assess its clients’ best tactical options and assist them in achieving maximum recovery.