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March 24, 2020 – Workouts, Restructuring, Bankruptcy and Creditor Rights

Financial distress is one fallout from COVID-19 (coronavirus), with the worldwide supply chain disrupted, businesses shut down, oil prices plummeting, mass unemployment and financial hardship all around. Lenders and borrowers, landlords and tenants, business owners and employees: everyone has been affected to varying degrees. The financial pain is real and immediate.

DHC’s Restructuring, Bankruptcy and Creditor Rights Group is here to help you “work it out” by preserving your business and assets and/or realizing maximum returns during this time of crisis. In addition to seeking bankruptcy protection, there are many tools in our workout and restructuring toolbox to help you manage these difficult times. Legal concepts rarely considered, including governmental aid, force majeure (an act of God) and “Good Guy Guarantee,” are being analyzed and contracts reviewed to see if such clauses were included.

Unfortunately, most legal problems will not wait for the end of COVID-19. Rent and loan obligations will be due soon, while simultaneously closed and cash-weak businesses will soon experience significant liquidity issues. Lenders and debtors alike will need to utilize a full set of legal tools to adequately respond to and survive the impending recession.

Some of the issues we are addressing for both lenders and borrowers include:

· Governmental financial aid

· Moratoriums

· Loan covenants

· Force Majeure

· Good Guy guarantees

· Damage limitations

· Insurance notice requirements

· Employment agreements

· Licensing including food, beverage and hospitality industries

· Treatment of employees in connection with business shutdowns

· Forbearance and deferral agreements

· Commercial foreclosures and deeds in lieu

· DIP financing

· Out of court debt restructuring

· Preferential transfer litigation

· Corporate governance

· Business crisis management and restructuring consultants

· Assisting clients with obtaining government funds and other assistance

· Asset protection

· Fraudulent transfers

· Assignments for the benefit of creditors (ABCs)

· Strict foreclosures

· Bankruptcy: chapters 7, 11, 13 and the new Small Business Reorganization Act

DHC’s Restructuring, Bankruptcy and Creditor Rights Group works closely with DHC’s other practice groups, to zealously advocate for each client’s interests including:

· Government relations/Lobbying

· Corporate

· Real Estate

· Litigation

· Matrimonial

· White Collar

· Trusts & Estates

Contact David Wander at (917.355.3993); Robert Rattet at (914.217.3000); Jonathan Pasternak at (201.960.3939); James Glucksman (914.482.4033); Alexander Tiktin at (516.729.6579) or any other DHC attorney with whom you regularly work for assistance.

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