KGI's extensive experience representing, debtors, creditors, equity holders and other constituencies in chapter 11 proceedings enables us to deliver superior results for our clients. We utilize our thorough understanding of the bankruptcy process to determine the key issues and leverage points in a given case, and apply the relevant tactical and analytical tools at our disposal to our clients’ advantage. Our work in chapter 11 proceedings spans a wide variety of industries and includes:
KGI has advised companies on bankruptcy proceedings throughout its nearly 30-year history. Our experience with all types of restructurings, from consensual out-of-court agreements to “cram-downs” in bankruptcy, enables us to determine when bankruptcy is the right course of action, and our understanding of the bankruptcy process enables us to achieve the best results for our clients. Our work in the bankruptcy context includes:
- Developing plans of reorganization
- Assembling financial forecasts (13-week and other)
- Negotiating with creditor and other constituencies
- Performing valuations
- Supporting analysis for priming loans
Creditor/Equity Committee Representation
KGI has advised secured and unsecured creditor, and equity committees in bankruptcies. Utilizing its thorough understanding of the bankruptcy process, KGI has been a creditor committee advocate on several transactions, resulting in materially improved recoveries for them. Activities taken on behalf of creditor committees include:
- Vetting Plans of Reorganization/Feasibility
- Proposing competing Plans of Reorganization
- Negotiating with other constituencies
- Reviewing financial forecasts and tracking performance against benchmarks
- Assessing asset values and enterprise value
- Identifying value-enhancing business improvements
Many Plans of Reorganization are not drafted with the creditors' best interest in mind. Creditor committees need a strong advocate to ensure they receive what they are entitled. KGI has proven time and again that its involvement generates improved recoveries for creditor constituencies.
In bankruptcy, KGI performs a variety of transaction activities, including obtaining financing, executing complex sales and restructuring debt obligations. Executing transactions within a bankruptcy requires attention to the economic, strategic and structural drivers of the transaction as well as the bankruptcy rules. KGI has extensive experience driving successful transactions in bankruptcy.
- Obtaining Debtor-in-Possession ("DIP") loans and Exit Financing
- Executing sales transactions pursuant to section 363 of the Bankruptcy Code
- Debt Restructuring
KGI performs a number of additional functions that are often critical to Bankruptcies. These include:
It is often important in a chapter 11 proceeding to determine whether a company was solvent at a certain historical point in time. There are specific tests that must be applied to conduct a solvency analysis that conforms to accepted standards. KGI has performed solvency analyses on behalf of clients in bankruptcy proceedings, submitted its solvency reports to the court, and defended them in court.
In the course of a bankruptcy proceeding, it is often necessary to examine a company’s books and records from prior periods to assess their accuracy and veracity. Often the records are incomplete and conducting these retrospective accounts requires locating the missing pieces to the puzzle. KGI can vet the accounting records and both provide a fair and impartial evaluation of the accounting records and identify the missing pieces necessary to complete the picture.
Litigation is increasingly becoming an important piece of any bankruptcy proceeding. From contested adequate protection hearings to Plan confirmation battles, constituents in a bankruptcy proceeding need to be prepared to present their case in court. Indeed, often being thoroughly prepared to litigate one’s position can increase the likelihood of a favorable settlement. KGI has repeatedly supported counsel in bankruptcy litigation by providing analysis and expert witness testimony to support its clients’ position and achieve superior results.
Unsecured claims in chapter 11 filings often include thousands of individual claimants. A detailed analysis of the claims registry, working in concert with the legal team to identify overstated claims and separate legitimate claims from the questionable or illegitimate, is necessary to determine the actual claims pool.