A letter from the insolvency administrator
It does not need to be one's own crisis which might bear risks: the (threatening) insolvency of customers and suppliers may have unpleasant consequences for your company, too. Maybe you have already received a letter of a (preliminary) insolvency administrator in recent times. Can you risk continuing the business relation with your insolvent customer? Can you still exercise your rights in connection with goods delivered under retention of title? What is at stake with regard to contracts already fulfilled by both parties? Should you join a pool of creditors or should you try to retrieve your money on your own? What are the options in case of financial difficulties of one of your key suppliers which might jeopardise the economic success of your company? Get professional legal advice as soon as possible! Don't just open your wallet and assist in a restructuring of your customer's debts without any proper evaluation of the situation. The first thing to do now is to minimize the exposure and contain potential risks!
It does not need to be one's own crisis which might bear risks: the (threatening) insolvency of customers and suppliers may have unpleasant consequences for your company, too. Maybe you have already received a letter of a (preliminary) insolvency administrator in recent times. Can you risk continuing the business relation with your insolvent customer? Can you still exercise your rights in connection with goods delivered under retention of title? What is at stake with regard to contracts already fulfilled by both parties? Should you join a pool of creditors or should you try to retrieve your money on your own? What are the options in case of financial difficulties of one of your key suppliers which might jeopardise the economic success of your company? Get professional legal advice as soon as possible! Don't just open your wallet and assist in a restructuring of your customer's debts without any proper evaluation of the situation. The first thing to do now is to minimize the exposure and contain potential risks!
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Insolvency of
Customers
Insolvency of
Customers
Crisis
Are you well prepared for the storm?
It can happen to anyone - to the market leader as well as to a start-up company. The most recent past has seen sufficient examples.
If the liquidity gets tight, the management and the shareholders should carefully evaluate any subsequent step. There is not only the risk of a personal liability vis-à-vis the creditors but also of criminal prosecution! Every measure bears potential traps: placing new orders with suppliers, payment of bills and even the payment of third parties to an overdrawn bank account of the company! You should seek legal advice immediately if the prognosis of the liquidity of the company becomes critical. Only if you get professional advice soon will you have sufficient time to identify all options and to make the right choice with a clear head. With a profound restructuring paper and an experienced counsel on your side it will be much easier to convince banks, customers and suppliers of your plans. And in a worst case you have somebody on board who will help you prepare the ship for the storm. Legal firewalls are more important now than ever since you should protect your private assets against an insolvency of your company.
It can happen to anyone - to the market leader as well as to a start-up company. The most recent past has seen sufficient examples.
If the liquidity gets tight, the management and the shareholders should carefully evaluate any subsequent step. There is not only the risk of a personal liability vis-à-vis the creditors but also of criminal prosecution! Every measure bears potential traps: placing new orders with suppliers, payment of bills and even the payment of third parties to an overdrawn bank account of the company! You should seek legal advice immediately if the prognosis of the liquidity of the company becomes critical. Only if you get professional advice soon will you have sufficient time to identify all options and to make the right choice with a clear head. With a profound restructuring paper and an experienced counsel on your side it will be much easier to convince banks, customers and suppliers of your plans. And in a worst case you have somebody on board who will help you prepare the ship for the storm. Legal firewalls are more important now than ever since you should protect your private assets against an insolvency of your company.
Liability of the Management … Social Plan … Obligation to File for Insolvency … Negotiations with the Works Council … Letter of Support ... Inability to Pay Debts... Insolvency Plan … Challenging of Contracts ... Restructuring … Center of Main Interest ... Over-Indebtedness ... Filing for Insolvency Abroad … Split Up of a Group … Ring Fencing ... Co-Determination …
Second Opinion on Restructuring Report …
Debt to Equity Swaps … Subordination Agreements ... Refinancing ...
Liability of the Shadow Manager
Other topics relating to special situations: