Corporate Restructuring and Bankruptcy

Negotiations and Voluntary Debt Arrangements

In many cases, the situation can be resolved without initiating formal proceedings. We assist companies in negotiations with creditors and prepare the necessary documentation for payment arrangements, asset sales or other restructuring measures. This may allow the company to avoid more burdensome and public restructuring or bankruptcy proceedings and enable the continuation of business operations.

Corporate Restructuring

Corporate restructuring proceedings provide an opportunity to reorganise an unprofitable business and restructure debts under a court-confirmed restructuring programme. Restructuring may allow the revival of business operations, reduction of debts and adjustment of repayment schedules.

An application for restructuring should ideally be filed when insolvency threatens the company, as the prospects for success are generally strongest at that stage. Even where a creditor has filed for the company’s bankruptcy, an application for restructuring may still be submitted in order to obtain protection against bankruptcy proceedings.

Sotka Legal evaluates together with the client whether the company qualifies for restructuring, prepares the necessary applications and supporting documentation, and represents the client throughout the entire process. Attorney Sotka has extensive experience in dozens of restructuring proceedings — including drafting applications and restructuring programmes, and representing clients before various levels of court, up to and including the Supreme Court.

Bankruptcy and Recovery of Assets to the Bankruptcy Estate

A company may be declared bankrupt if it is unable to meet its obligations. Bankruptcy may be initiated either by the company itself or by a creditor. A voluntary bankruptcy petition may be appropriate where insolvency is inevitable.

We assist in matters relating to the recovery of assets to the bankruptcy estate.
The purpose of recovery proceedings is to prevent an insolvent debtor from transferring assets beyond the reach of creditors or favouring one creditor at the expense of others. In recovery situations, payments made by a company prior to bankruptcy may be reclaimed from a creditor who received payment before the bankruptcy.

Where accounting obligations have been neglected prior to bankruptcy, assets have been transferred to avoid creditor claims, or certain creditors have been paid while others have been left unpaid, the matter may involve accounting offences, tax offences or debtor’s offences. We have experience handling such matters before courts of all instances.