Bankruptcy & Restructuring
It can be difficult to know the right moment to hire advisors to assist in times of financial distress or crisis. At times, business owners and managers assert that they can effectively manage affairs even when the bills are going unpaid, or loan covenants have been violated. Whitley Penn professionals have experience in situations where companies need help assessing their situation, managing dwindling cash, responding appropriately and accurately to requests for information, and negotiating with lenders and suppliers. Our team helps find solutions, ease tensions with lenders and suppliers, and works to restore credibility with third parties. We can also serve as a “buffer” for management so that they can focus on running the business while we determine steps forward on any restructuring process. We also take on management roles as needed/requested.
Services Offered
Restructuring/Turnarounds
- Perform viability, solvency & feasibility assessments.
- Improve cash flow management.
- Develop and implement revised business model.
- Generate and implement cost reduction strategies.
- Stabilize business and establish profitability.
Crisis Management
- Serve as CRO, CEO, COO, and CFO.
- Generate and implement a plan to manage liquidity.
- Develop strategies for key vendors and customers.
- Initiate communication and restore credibility with all stakeholders.
- Change culture.
Bankruptcy Advisory
- Perform pre-bankruptcy planning.
- Prepare MORs, Schedules, and SOFAs.
- Review or develop projections/other Plan of Reorganization matters.
- Testify on valuation/other contested issues.
- Evaluate recovery alternatives and exit strategies.
- Effect Reorganization Financial Reporting (ASC 852).
- Conduct sales and divestitures.
Financial Restructuring
- Prepare debt capacity analysis.
- Assist in negotiations with principal creditors as well as other parties-in-interest.
- Render asset or business enterprise valuations, including liquidation analyses.
- Assist in raising debt, DIP, takeout/exit financing.
- Conduct asset or business enterprise sales/divestitures.
Trustee Support
- Identify and evaluate preferential transfers and fraudulent conveyances.
- Perform and testify regarding solvency analyses.
- Perform financial investigations and analyses including forensic accounting.
- Locate and secure books, records, and key documents.
- Evaluate proofs of claim against estates.
- Serve as Trustee or Receiver (conduct wind-down).
- Serve as expert witness and testify in Post-Confirmation Litigation.
Sometimes, filing for bankruptcy is what a company needs to effectively reorganize. Filing for bankruptcy is often taken to mean that a company is going out of business, but this is not always the case. Many companies have filed for Chapter 11 bankruptcy and successfully reorganized. These include such household names such as American Airlines, General Motors, Hostess, and Six Flags.
Owners and executives can greatly improve their chances of reorganizing their companies by:
- Hiring the right attorneys and financial advisors
- Bringing in these professionals very early in the process
- Recognizing and acting on the need to reorganize, whether in or outside of Chapter 11
- Conducting a thoughtful restructuring process with all options on the table
- Working with trusted, experienced professionals, to file Chapter 11 at the optimal time
Whitley Penn professionals have worked with middle market companies that filed Chapter 11 and successfully emerged as reorganized, stronger businesses. Our team assists clients throughout the bankruptcy and insolvency process. We work collaboratively and cost-effectively with appropriate counsel and the client to develop and execute strategies to maximize recovery, minimize exposure, and realize the best business outcome. Our role may entail not just advising but being the client in cases where we serve as Chief Executive Officer, Chief Restructuring Officer, or Chief Financial Officer of the company or debtor. Whitley Penn professionals have served in specialized roles such as Trustee, Keeper, Receiver, or Liquidating Trustee as circumstances warrant or dictate. If matters become contentious, we have extensive experience in testifying on financial and operational matters.
The Bankruptcy and Restructuring Practice of Whitley Penn engages in all aspects of the bankruptcy and insolvency process from a financial advisory, operational, or managerial standpoint. When it comes to making the right decision for your company, time and action are of the essence, as is having a strong team in your corner. As your financial advisor, Whitley Penn looks to be part of this team and work at your direction and that of bankruptcy counsel to achieve successful results.
Who we serve
Companies (debtors)
Act as CEO, CRO, CFO, financial advisor, or consultant to companies in out-of-court restructurings as well as debtors in Chapter 11. Our role could include providing or conducting turnaround services, crisis management, the divestiture of assets or businesses, securing new, replacement, or DIP financing, cash flow management, process and performance improvement, coordination of vendor and creditor negotiations and communications, including 503(b)(9) claims, general bankruptcy process consulting, valuation for various purposes and expert testimony.
Committees of various constituent groups
Serve as financial advisor to creditors, equity, and other committees in Chapter 11. Whitley Penn professionals have served as financial advisor to committees as an expert witness on valuation and other matters as well through financial advisory assistance involving cash collateral analyses, preparation of reorganization and recovery analyses and scenarios, liquidation analyses, attempts to secure DIP and exit financing, evaluation of auction/sales processes and bids received, financing issues, adequate protection issues, and general bankruptcy matters.
Suppliers/creditors
Provide expert testimony on behalf of supplier/creditor constituencies relating to Solvency, Value, Reasonably Equivalent Value, and Damages as defenses to preference, fraudulent transfer, and voidable transaction litigation. Whitley Penn professionals have also served as Trustee and Liquidating Trustee to wind-down operations and distribute proceeds to creditors.
Financial institutions and private equity/hedge fund investors
Render financial advisory services on behalf of lenders and investors including serving as an expert witness in contested confirmation hearings involving Interest Rate or Feasibility issues, solvency and valuation matters, and lease re-characterization proceedings as well as the performance of collateral analyses, financial due diligence, and business plan assessments. Whitley Penn professionals have also served as Keeper and Receiver of lenders’ collateral pending judicial foreclosure.
