Bankruptcy and Restructuring Litigation

Overview

Bankruptcies are seldom within the creditor’s control and pose a risk to financial institutions of all shapes and sizes. Smith Debnam’s versatile and experienced bankruptcy team is equally adept at representing creditors in both consumer and commercial matters across all Chapters of the Bankruptcy Code. In addition, Smith Debnam has built a reputation for developing innovative and insightful solutions to maximize recovery for creditor clients while mitigating loss.

Our clients include:

• National, Regional, and Community Banks
• Credit Unions
• Mortgage Servicers
• Auto and Equipment Finance Companies
• Agrifinance Lenders
• General Contractors, Subcontractors, and Building Suppliers
• Technology and Software Companies
• Equipment Lessors
• Institutional Lenders
• Commercial Landlords
• Alternative Finance Companies
• Factors

COMMERCIAL CREDITOR BANKRUPTCY KEY SERVICES

Our commercial bankruptcy team is prepared to handle matters throughout the commercial bankruptcy life cycle, including arguing first-day motions, negotiating cash collateral treatment, seeking relief from the automatic stay, compelling assumption, or rejection of executory contracts, negotiating plan treatment, and objecting to confirmation.

Commercial Creditor Bankruptcy Representation

• Negotiate post-petition financing terms
• File proofs of claim and defend against claim objections
• Defend against attempts to “cramdown” secured value
• Argue first-day motions
• Handle cash collateral motions
• Maximize value via court-authorized asset sales
• Obtain orders for adequate protection/relief from the automatic stay
• Enforce and protect executory contracts & leases
• Litigate adversary proceedings, including defending preference, fraudulent transfer, and other avoidance claims
• Handle setoff and reclamation claims
• Handle claims for statutory or equitable subordination
• Object to discharge and/or challenge dischargeability of particular debts
• Represent official committees of unsecured creditors in Chapter 11 bankruptcies
• Negotiate favorable plan treatment through negotiations and/or objections to plan and disclosure statement
• Provide post-confirmation guidance and representation in plan modification proceedings

Workouts and Loan Restructuring

• Provide default notices
• Accelerate and enforce loan documents in both state court and bankruptcy court on behalf of lenders
• Pursue guarantors of commercial secured & unsecured loans
• Negotiate modification and restructuring of credit arrangements
• Negotiate and document loan forbearance, restructuring, and extension agreements
• Administer acquisition & sale of financially troubled entities

CONSUMER CREDITOR BANKRUPTCY KEY SERVICES

Smith Debnam’s bankruptcy attorneys apply their collective breadth of experience, coupled with an understanding of the creditor’s sense of urgency and practical local knowledge, to provide quality statewide representation to a wide variety of consumer creditor clients in all North and South Carolina Bankruptcy Courts.

Consumer Creditor Bankruptcy Representation

• Obtain orders for relief from stay and adequate protection
• Prepare and file proofs of claim
• Draft, negotiate, and file reaffirmation agreements
• Obtain orders compelling assumption or rejection of executory contracts and leases
• Plan review and objections
• Review and assess dischargeability issues
• Negotiate and resolve claim objections
• Litigate adversary proceedings, including defending preference, fraudulent transfer, and other avoidance claims
• Maximize value via court-authorized asset sales
• Defend against attempts to “cramdown” secured value
• Defend lien stripping and lien avoidance actions under sections 522(f) and 506 of the Bankruptcy Code
• Object to discharge and/or dischargeability of debts

Commercial Creditor Bankruptcy – Sample Representations

Our team regularly serves as counsel to secured creditors, including banks, agrifinance companies, construction companies, equipment lessors, finance companies, and other creditors in Chapter 11 and 12 bankruptcies with respect to motions for relief, assumption or rejection of executory contracts and leases, negotiation of plan treatment, and objections to confirmation.

• In Chapter 11, involving a large and protracted four-county farming operation, members of our team successfully represented the primary ag input lender, whose claim exceeded $2 million dollars, assisting it in negotiating cash collateral and plan treatment.
• In litigation related to a large farming Chapter 11, members of our team successfully recovered over a half-million dollars in crop proceeds which were fraudulently conveyed to third parties.
• In Chapter 11 of a small restaurant chain, the firm represented the SBA lender whose claim exceeded $1 million dollars with respect to cash collateral and plan treatment.
• In liquidating Chapter 11 of a fitness gym chain, the firm served as counsel to a large national bank in securing the turnover of its leased gym equipment.
• In Chapter 11 of a multistate builder, the firm served as counsel to a national building supply company in the defense of preference and fraudulent transfer claims.
• In the Chapter 11 liquidation of a paper manufacturing company, the firm represented a secured creditor bank regarding a number of related adversary proceedings.
• In a single asset real estate Chapter 11, members of our team represented a bank lender with a claim exceeding $800,000 regarding the negotiation of cash collateral, adequate protection, and plan confirmation.
• In multiple Chapter 11s involving golf courses, the firm as served as counsel to the financing company or lessor of the golf course equipment with respect to its leases, stay relief, and plan treatment.
• Members of our team served as counsel for the Official Committee of Unsecured Creditors with respect to a resort property’s Chapter 11.
• In Chapter 11 of a large medical practice, the firm served as counsel to a large national software company with respect to its executory contracts.
• In liquidating Chapter 11 of a hospital system, the firm served as counsel to a large national software company regarding the rejection of its executory contracts.
• Members of our team served as counsel for the trustee in Chapter 7 of condominium development in prosecuting avoidance actions and negotiating the sale of the property at a section 363 sale.
• Members of our team successfully defended an investment brokerage firm regarding an avoidance action by the trustee.