Section 70 Companies in Financial Stress (New Section)

• Library: Business Transitions 2009 Supp

Because of the recent economic upheaval, it is important for transaction attorneys to focus more closely than ever on the inherent risks involved in, and the liabilities that can arise from, representing businesses operating under serious financial stress. Undercapitalization, lack of needed bank financing, inadequate cash flow, and poor economic performance are critical problems for an increasing number of companies in numerous industries.

Companies, large and small, that only a year ago were fundamentally sound (or believed to be) are now operating, or are in imminent danger of having to operate, as debtors in possession under
a...