Guidelines for the Conduct of Asset Sales
The U.S. Bankruptcy Court for the Southern District of New York has established the following guidelines for the conduct of asset sales under §363(b) of 11 U.S.C. §§101 et seq. (the “Bankruptcy Code”). The Guidelines are designed to help practitioners identify issues that typically are of concern to parties and the court so that, among other things, determinations can be made, if necessary, on an expedited basis.
Notice of Opportunity to Provide Comments on Proposed Guidelines for the Conduct of Asset Sales in the Bankruptcy Court for the Southern District of New York
by: Kathleen Farrell-Willoughby
U.S. Bankruptcy Court; New York
The Judges of the U.S. Bankruptcy Court for the Southern District of New York hereby invite public comment on the following Guidelines for the Conduct of Asset Sales.
Complex Chapter 11 Developments
by: Hon. Michael G. Williamson
U.S. Bankruptcy Court; Tampa, Pla.
The modern trend in chapter 11 is to liquidate the business as a going a concern through a sale under §363. This is particularly true in cases where the primary secured lender’s debt exceeds the value of the business. In such cases, while losses will be funded out of cash collateral, the lender will reap the benefit of selling its collateral quickly as a going concern rather than in a fire-sale, courthouse-steps liquidation. Other advantages include the ability to sell free and clear of liens and having an order approving the various terms and conditions that are needed in order to obtain the highest possible price for the business.
Read the full article. (Materials from the 2006 Southeast Bankruptcy Workshop)
Note from the Editor
by: Gary S. Jacobson
Herold and Haines, P.A.; Warren, N.J.
The law and practice of §363 sales is the theme of the July 2006 edition of the Asset Sales Committee Newsletter.
Judge Michael G. Williamson (M.D. Fla.) has comprehensively outlined the law and procedure applicable to sales of businesses as going concerns during chapter 11 cases. Judge Williamson’s materials accompanied his presentation at the 2006 Southeast Bankruptcy Workshop.
The Southern District of New York has proposed guidelines for the conduct of asset sales and has requested comments by August 21. Regardless of whether the proposed guidelines are altered in response to comments, they provide a splendid checklist for practitioners in teeing up a §363 sale for approval by any bankruptcy court.
Our members have many insights to share with one another. We encourage you to submit material, short or long, for publication in this newsletter. Our next deadline for publication is Sept. 19, 2006. Please do not hesitate to telephone or e-mail me with your ideas or submissions.