The Financially Troubled Company

The Monetization Of Intellectual Property In Bankruptcy And Restructuring

Bob Eisenbach — Wed, 25 May 2022 15:56:29 +0000

ABI Panel. Last month I had the honor of speaking on a panel at the American Bankruptcy Institute’s 2022 Annual Spring Meeting in Washington, D.C. The topic of our panel was the Monetization of Intellectual Property in Bankruptcy and Restructuring. Video Available. The American Bankruptcy Institute has now made the the video of the panel discussion available for your viewing pleasure — just…

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Fiduciary Duties And Financial Distress In The Time Of COVID-19

Bob Eisenbach — Mon, 23 Mar 2020 14:58:51 +0000

The COVID-19 pandemic has caused unprecedented economic disruption, creating sudden financial distress across industries. Companies are now facing impacts ranging from a dramatic decline in revenue of uncertain duration, to potential setbacks to M&A transactions, to delayed or canceled financing rounds. With even some previously well-performing companies potentially entering the so-called zone…

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The Venture-Backed Company Running Out Of Cash: Fiduciary Duties And Wind Down Options

Bob Eisenbach — Tue, 16 Feb 2016 16:37:42 +0000

Many start-up companies backed by venture capital financing, especially those still in the development phase or which otherwise are not cash flow breakeven, at some point may face the prospect of running out of cash. Although many will timely close another round of financing, others may not. This post focuses on options available to companies when investors have decided not to fund and the company…

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You Say You Want A Dissolution: An Overview Of The Formal Corporate Wind Down

Bob Eisenbach — Tue, 24 Feb 2015 16:02:27 +0000

Winding Down. If a corporation’s board of directors decides that the business needs to be wound down, there are a number of legal paths to consider. Determining the best approach is fact-dependent, and the corporation and its board should get legal advice before making a decision. Sometimes a bankruptcy filing is needed, either a Chapter 11 reorganization (perhaps to complete a going-concern sale)…

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A New Way Of Looking At Termination On Bankruptcy Contract Clauses

Bob Eisenbach — Mon, 23 Jun 2014 14:57:56 +0000

Image Courtesy of NobMouse Ken Adams, Professor Adrian Walters, and I recently collaborated on an article about the ubiquitous “termination on bankruptcy” or ipso facto clauses in contracts. The article was just published by the American Bar Association’s Business Law Section in its online publication, Business Law Today. It’s titled “Termination-On-Bankruptcy Provisions: Some Proposed Language”…

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DIP Financing: How Chapter 11’s Bankruptcy Loan Rules Can Be Used To Help A Business Access Liquidity

Bob Eisenbach — Tue, 05 Nov 2013 16:30:25 +0000

Cash Is King. An army may march on its stomach, but for companies, it’s liquidity that keeps the business going. For many companies, typical sources of liquidity, beyond cash flow from sales or other revenue, are (1) financing from banks or other secured lenders, (2) credit from vendors that can reduce immediate liquidity needs, and (3) when needed, loans from owners, investors, or other insiders.

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The Privilege Is All Mine: What Happens To A Corporation’s Attorney-Client Privilege In Bankruptcy?

Bob Eisenbach — Mon, 29 Jul 2013 11:25:03 +0000

It’s well-established that a corporation has an attorney-client privilege and can assert it to keep communications between the corporation and its attorneys confidential. When a corporation is solvent, its officers and directors maintain the right to assert — or waive — the attorney-client privilege on behalf of the corporation, and control who has access to privileged communications.

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Using Chapter 11 Bankruptcy’s Sale Process To Achieve An Exceptional Sale Price

Bob Eisenbach — Mon, 11 Mar 2013 11:56:36 +0000

A Difficult Problem. Imagine that your company is facing a government investigation, requiring you to spend hundreds of thousands of dollars in legal fees and costs, while being threatened with substantially more legal expense. That financial burden is simultaneously starving the company of cash needed to grow the business, and cash balances are heading toward zero. Worse yet, the cloud over the…

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Summer 2012 Edition Of Bankruptcy Resource Now Available

Bob Eisenbach — Thu, 26 Jul 2012 17:57:25 +0000

The Summer 2012 edition of the Absolute Priority newsletter, published by the Bankruptcy & Restructuring group at Cooley LLP, of which I am a member, has now been released. The newsletter gives updates on current developments and trends in the bankruptcy and workout area. Follow the links in this sentence to access a copy of the newsletter. You can also subscribe to the blog to learn when future…

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Forced Into Bankruptcy: The Involuntary Bankruptcy Process

Bob Eisenbach — Thu, 24 May 2012 11:06:27 +0000

When a company is facing financial distress, the question often comes up whether creditors can "force" the company into bankruptcy. Although the answer is more complicated than it may seem, this post aims to sort out what being "forced into bankruptcy" really means (hint: there are two different ways this can happen) and why it matters to companies and creditors. Forced But Voluntary Bankruptcy.

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