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Loss of liquidity is a risk inherent in any business activity, especially in times of coronavirus pandemic. Sometimes it is only temporary in nature, but in many cases it requires specific corrective measures and initiating restructuring or even bankruptcy proceedings.
When liquidity is lost or threatened, it is particularly important from the perspective of the company and its managers:
first of all, to correctly diagnose the current situation of the company and its forecast for the future
to choose the most appropriate way to get the company out of a state of insolvency or threat of insolvency or to terminate its activity
to prepare the company and its managers for the chosen scenario properly
to duly perform the whole process
entrepreneurs who have become insolvent or are in danger of becoming insolvent
the creditors of such entrepreneurs
bankruptcy trustees, court supervisors and court administrators
In a single organization, we can ensure the full support of the best specialists in specific sectors, which can significantly contribute to the success of the implemented recovery scenarios, as well as the ongoing restructuring and bankruptcy proceedings.
The strength of our team, which ensures that we are able to help our Clients even in the most complex and serving as precedent cases and provide them with comprehensive advice, is that:
our team consists of lawyers with many years of experience in restructuring and bankruptcy cases
our team is composed of lawyers from various fields of law, specializing in issues related to insolvency of enterprises, including in particular litigators and M&A lawyers
we closely cooperate with PwC experts from other departments (audit, tax, advisory), which makes our offer not only comprehensive but also unique
Analysis of the situation of an enterprise in terms of meeting the conditions for insolvency
It is often difficult to determine whether the conditions for insolvency have been met and sometimes the analysis in this area does not produce clear results. Therefore, the scope of our services includes:
support in assessing whether the conditions for insolvency have been met
preparation of legal opinions on the assessment of the fulfilment of the conditions for insolvency, including cases that are ambiguous and require extended legal analysis
advice on avoiding or interrupting a state of insolvency
Where the analysis carried out for the purposes of determining whether the conditions for insolvency have been met shows that a company is insolvent or is at risk of becoming insolvent, it is crucial to choose the most optimal scenario for the company itself, the capital group it is part of, a creditor or a potential investor, depending on whose interest we are considering.
Therefore, the scope of our services includes a comprehensive analysis, not limited only to legal issues, but also taking into account the economic interest of our Clients, which results in presenting solutions that are most beneficial from the perspective of our Clients. In our recommendations for:
companies in danger of insolvency or already insolvent we indicate in particular whether:
in specific circumstances it is possible to avoid or interrupt the state of insolvency, and if so, how
it is advisable to attempt out-of-court restructuring and, if so, how it should proceed
it is advisable to initiate one of the restructuring proceedings and, if so, which one
the initiating of bankruptcy proceedings is advisable
creditors of companies in danger of insolvency or already insolvent we indicate in particular how they should recover their claims in order to satisfy their claims as far as possible
investors interested in investing in companies in danger of insolvency or already insolvent we first of all indicate the most advantageous and the safest way to invest
In the era of the coronavirus pandemic (COVID-19), the legislator is trying to meet the needs of entrepreneurs who are affected by the current situation. The use of measures and solutions introduced by the legislator in connection with the coronavirus pandemic and the related economic crisis may protect entrepreneurs from the need to implement special restructuring plans or initiate restructuring or bankruptcy proceedings.
Therefore, we follow the planned legal regulations on an ongoing basis in order to be able to advise our Clients in these difficult times.
The company’s financial difficulties do not necessarily mean that one of the restructuring proceedings, let alone bankruptcy proceedings, has to be opened. In many cases it may be possible and economically viable to carry out so-called out-of-court restructuring, which may in particular consist in:
obtaining external financing
change in the terms of the agreements binding a company in danger of insolvency
changing the business model, including through sale of redundant assets, termination of unprofitable part of the business and focusing on profitable activity
Within the framework of out-of-court restructuring of our Clients, we support them in particular through:
support in attracting potential capital investors
representation in negotiations with a potential investor or a company requiring funding, conducting due diligence and preparing investment documentation
representation in negotiations on obtaining or granting external financing, including in the form of loans and credits, and preparing the necessary documentation in this respect
advisory services in the process of issuing or acquiring debt securities
advice on debt-to-equity swap
assessment of the occurrence of grounds for breaching commercial and credit agreements, as well as obligations under other legal titles, including those arising from the terms and conditions of bond issue, in connection with a state of insolvency or a situation of threatened insolvency
representation in negotiations and disputes relating to possible breach of obligations in connection with a state of insolvency or a situation of threatened insolvency
representation in renegotiating the terms of individual contracts
representation in negotiations on debt repayment and standstill agreements and preparation of such agreements
advising on the disposal and acquisition of assets and organized parts of the enterprise, including conducting due diligence, representation in negotiations and preparation of relevant agreements and other transaction documentation
securing the interests of management board members of the companies undergoing restructuring, creditor companies and investor companies by preparing legal opinions confirming the legitimacy of the actions taken
The aim of each of the four restructuring proceedings, i.e. the proceedings for approving the arrangement, the accelerated arrangement proceedings, the arrangement proceedings and the sanation proceedings, is to avoid bankruptcy and to improve the situation of the enterprise.
Our services in the field of restructuring proceedings include in particular:
advice on choosing the right restructuring proceedings
support in drawing up the restructuring application
representation in negotiations with creditors in order to ensure the effective conduct of the restructuring proceedings
comprehensive litigation services as part of the restructuring proceedings, including preparation of necessary pleadings and representation in relations with the court supervisor or the court administrator
As part of our activities, we support not only the restructured companies and entire capital groups that include such companies, but also their creditors, potential investors as well as the court supervisors and the court administrators established as part of the restructuring proceedings.
In some cases, bankruptcy may not only be necessary, but it may even be the best solution, especially from the perspective of the entire capital group to which the insolvent company or the company at risk of insolvency belongs.
In the field of declaration of bankruptcy and bankruptcy proceedings, we support not only insolvent entities and entire capital groups that include such entities, but also their creditors, potential investors, as well as the bankruptcy trustees, the court supervisors and the court administrators.
In the field of bankruptcy, our services include in particular:
preparation of insolvent entities and the entire capital group for bankruptcy proceedings, including in particular through actions protecting managers of insolvent entities against possible liability and protecting interests of other entities in the group, as well as securing assets needed to cover the costs of the bankruptcy proceedings
support in drawing up a bankruptcy application
defending of the debtor against a bankruptcy application submitted by the creditor
comprehensive legal services in bankruptcy proceedings, including:
preparation of necessary procedural documents
advice on obtaining injunction (court security) before declaration of bankruptcy
representation in relations with the court supervisor or the court administrator, if any
comprehensive legal services in bankruptcy proceedings, including:
preparation of necessary procedural documents
advice on reporting of claims
advice on declaring the activities of the bankrupt as ineffective
representation in relations with the bankruptcy trustee
support in entering into an arrangement in the course of the bankruptcy proceedings
advice on pre-packaged liquidation (so-called pre-pack)
advice on the debt-for-equity swap
advice on cross-border bankruptcy proceedings of Polish companies in the territory of one of the EU countries, including support in the process of secondary bankruptcy of the entrepreneur’s subsidiaries in Poland or one of the EU countries.
Insolvency and bankruptcy involve the risk of liability of managers, as well as a number of potential court proceedings that may be parallel to the bankruptcy proceedings. Due to the fact that our team consists of litigators with many years of experience, we provide our Clients with comprehensive services in all proceedings related to the insolvency or bankruptcy of specific entities, as well as services related to the mitigation of the risk of such proceedings.
Our services in this area include in particular:
preparation of legal opinions on the possible liability of managers, including recommendations on the mitigation of the risk of their civil and criminal liability and securing the entity in the event of criminal proceedings being initiated against its representatives
representation in civil proceedings concerning, in particular, the liability of the management board members for the late filing of an application for bankruptcy or so-called actio pauliana
representation in criminal proceedings concerning, in particular, the liability of management board members in connection with the late filing of an application for bankruptcy, indicating of false data in an application for bankruptcy, thwarting of the satisfaction of the creditors and the harm to others
Pre-packaged liquidation is a relatively young institution which enables the sale/acquisition of a part or all of the enterprise of the debtor or some of its components as part of bankruptcy proceedings.
Within the framework of a pre-packaged liquidation we provide:
legal support in due diligence
transactional support in preparing and negotiating agreements for the sale of a part or all of the enterprise of the debtor or some of its components
representation in insolvency and bankruptcy proceedings