A majority of today’s large Chapter 11 cases are structured as quick Section 363 sales of all the debtor’s assets followed by confirmation of a plan of liquidation, dismissal of the case, or a conversion to a Chapter 7. The purchaser in the sale is often one of the debtor’s prepetition secured or...

To minimize their financing costs, retail companies commonly provide ABL lenders and term loan lenders with senior liens over separate silos of collateral. Typically, the ABL lenders have priority liens over the company’s borrowing base assets—most commonly current assets, such as receivables and...

The U.S. retail industry is tattered and torn, and Chapter 11 continues to be an inevitable ending for many distressed retailers struggling in the post-Amazon world. Indeed, despite the recent uptick in the U.S. economy, retailer woes have continued unabated, with sales for many continuing to...

It should come as no surprise to turnaround professionals or even casual readers that the retail industry is in a state of transition. However, contrary to the popular refrain, this transition does not signal that brick-and-mortar retail is dead, nor is it in the midst of an apocalypse. The retail...

Last year more than 20 national retail chains filed for bankruptcy protection, continuing a trend that many observers attribute to the rise of e-commerce and the unprecedented growth of Amazon. While the impact of those forces certainly cannot be denied, the history of retail is also one marked by...

The 2005 amendments to the U.S. Bankruptcy Code foreclosed the ability of retailers to defer store lease assumption or rejection decisions until the end of a bankruptcy case. Following the 2005 amendments, retailers followed a predictable path leading up to bankruptcy, typified by waiting as long...

When charting a course through bankruptcy, retailers must prioritize maintaining sufficient liquidity to fund operations and the expenses associated with the case. To accomplish this, retailers typically use a lender’s cash collateral and obtain debtor-in-possession (DIP) financing. Both are...

The struggles of the U.S. retail sector have been well publicized—so much so that the term “retail apocalypse” is now firmly established in the lexicon. Last year alone, more than 20 national chains in the United States, including names like RadioShack, hhgregg, BCBG Max Azria, Gander Mountain, and...

When turnaround professionals represent retail organizations that are in a state of transition and require new ownership, they are managing a multifaceted situation. The sale of goods and/or services to customers through multiple distribution channels can be challenging to begin with; adding...

In rocket science, guidance maneuvers that employ engine thrust to slow or steer a rocket are often said to have made use of a “controlled burn.” While retail liquidations are certainly not rocket science, many small retailers could benefit from the use of a “controlled burn” of their own to slow...