Companies in difficulty and restructuring

Are you looking for a lawyer specializing in insolvency law to anticipate a crisis, restructure debt, or support you in collective proceedings? ARST Avocats assists companies, managers, shareholders, creditors, investors, buyers, and employees facing the economic and legal consequences of a difficult situation.

Our team supports clients from the onset of initial cash flow difficulties through to the implementation of a restructuring, refinancing, sale, or liquidation solution. We intervene in amicable preventative procedures, safeguard, restructuring, and liquidation proceedings, as well as in any resulting litigation.

This practice combines insolvency law, restructuring, corporate law, finance, employment law, commercial contracts and business litigation.

Lawyer specializing in insolvent companies: anticipating and acting

A company's difficulties can be financial, economic, legal, social, or operational. They can result from a decline in activity, significant unpaid invoices, excessive debt, the loss of a strategic client or supplier, a conflict between partners, or the failure of an investment project.

Early intervention allows for more solutions to be retained and better protects the company, its managers and its assets.

ARST Avocats assists companies in:

• an analysis of their legal and financial situation;
• identifying the causes of their difficulties;
• review of cash flow and short-term maturities;
• analysis of bank, tax, social and supplier debt;
• verification of the enforceability of debts;
• the identification of the state of cessation of payments;
• the preparation of restructuring scenarios;
• negotiation with the main creditors;
• the search for extensions, waivers or rescheduling of debts;
• securing essential contracts;
• the protection of assets necessary for the business;
• preparing for a search for investors or buyers;
• the choice of the appropriate amicable or collective procedure.

We work in coordination with managers, financial departments, accountants, auditors, financial advisors and accounting professionals to propose a legally secure and economically realistic strategy.

Diagnosis and prevention of difficulties

Prevention aims to address difficulties before they become insurmountable.

Our team assists companies and their leaders with:

• to establish a legal diagnosis of the situation;
• analyze contracts that carry a risk of termination;
• identify the debts to be recovered;
• negotiate moratoria with suppliers;
• reschedule bank loans;
• negotiate with tax and social security bodies;
• prepare a referral to the CCSF;
• to support discussions with financial partners;
• examine the guarantees and surety commitments of the directors;
• renegotiate rents and real estate contracts;
• review the legal or operational organization of the group;
• prepare for a capital increase or the entry of an investor;
• organize a partial sale of assets or activities;
• anticipate the social consequences of a restructuring;
• securing the decisions of leaders.

ARST Avocats also helps the manager to meet their legal obligations and to document the decisions taken during the period of difficulty.

Ad hoc mandate and conciliation

The ad hoc mandate and conciliation are confidential procedures allowing for the search for a negotiated solution under the aegis of a professional appointed by the president of the competent jurisdiction.

ARST Avocats assists the company in:

• the choice between ad hoc mandate and conciliation;
• the preparation of the request;
• the determination of the requested mission;
• the preparation of the financial and legal file;
• preparing for the hearing before the president of the court;
• the proposal of an ad hoc representative or a conciliator;
• negotiation with banking institutions;
• negotiation with public and private creditors;
• the restructuring of repayment deadlines;
• obtaining extensions and debt waivers;
• the search for new funding;
• negotiation with shareholders or investors;
• the resolution of a conflict between partners;
• the preparation of a sale of a company or a branch of activity;
• the drafting of the conciliation protocol;
• the confirmation or approval of the agreement.

The ad hoc mandate allows the manager to negotiate confidentially with his main creditors while continuing to manage his company.

These procedures can also be used to prepare for a broader financial restructuring, an accelerated safeguard or a takeover operation.

Financial and operational restructuring

ARST Avocats intervenes in restructuring operations aimed at restoring the viability of the company.

Our support can cover:

• debt rescheduling;
• the renegotiation of rates, maturities and guarantees;
• debt waivers;
• clauses for return to better fortune;
• the conversion of debt into capital;
• the contribution of equity or quasi-equity;
• the issuance of securities;
• the entry of new investors;
• capital restructuring;
• the reorganization of a group of companies;
• the sale of non-strategic assets;
• the creation of a subsidiary or the separation of an activity;
• the closure of a loss-making establishment;
• the renegotiation of key contracts;
• cost reduction and workforce adjustments;
• the search for an industrial or financial partner.

Our team coordinates the corporate, contractual, social and legal aspects of the restructuring to ensure the consistency of the entire operation.

Backup and accelerated backup

The safeguard procedure is aimed at a company which, without being in default of payments, is experiencing difficulties that it is unable to overcome on its own.

We support companies in:

• analysis of the conditions for opening the backup;
• the preparation of the request and the necessary documents;
• the presentation of the case before the court;
• relations with the administrator and the judicial representative;
• the organization of the observation period;
• the continuation of the activity;
• the management of current contracts;
• the handling of prior liabilities;
• the preparation of activity and cash flow forecasts;
• the preparation of the draft plan;
• consultation with creditors;
• the constitution and functioning of the classes of affected parts;
• the negotiation of the terms for settling the liabilities;
• the presentation and adoption of the safeguard plan.

When the conditions are right, we also consider the possibility of an accelerated safeguard procedure to allow for the rapid adoption of a restructuring negotiated beforehand.

Judicial reorganization and continuation of business

Judicial reorganization should be considered when the company is in default of payments but the continuation of its activity and its recovery remain possible.

ARST Avocats assists the company and its management in:

• the determination of the date of cessation of payments;
• the preparation of the declaration of cessation of payments;
• the request to open judicial reorganization proceedings;
• the preparation for the opening hearing;
• relations with the court and the bodies involved in the proceedings;
• maintaining activity during the observation period;
• the preparation of budgets and cash flow forecasts;
• the management of current contracts;
• the processing of prior and subsequent claims;
• the preparation of wage claim statements;
• negotiation with key partners;
• the search for funding;
• the preparation of a recovery plan;
• the organisation of the consultation of creditors;
• the constitution of the classes of affected parts;
• negotiating deadlines and discounts;
• the preparation of a total or partial transfer when this becomes necessary.

Our team assists the manager during successive hearings and ensures that complete and consistent information on the prospects for recovery is presented.

Safeguard and recovery plans

Developing a plan requires demonstrating the company's ability to continue its operations and clear its liabilities over time.

We support the company in:

• the definition of the plan's perimeter;
• the establishment of operating forecasts;
• determining financing needs;
• negotiation with creditors;
• the proposal for payment deadlines and debt forgiveness;
• the organization of reimbursements;
• the handling of collateral;
• the search for new funds;
• capital restructuring;
• the sale of assets;
• the legal reorganization of the group;
• the necessary social measures;
• the preparation of documentation submitted to the court;
• monitoring the execution of the plan;
• requests for substantial modification of the plan.

We also intervene when the execution of the plan encounters difficulties or when a new restructuring becomes necessary.

Judicial liquidation and cessation of business

When recovery is clearly impossible, judicial liquidation organizes the cessation of activity and the realization of assets.

ARST Avocats assists the company and its manager in:

• analysis of the situation prior to liquidation;
• the preparation of the declaration of cessation of payments;
• the request for opening or conversion into judicial liquidation;
• preparing for the hearing;
• relations with the court-appointed liquidator;
• the inventory and handing over of the necessary documents;
• contract and asset management;
• the sale of the business or individual assets;
• the processing of personal guarantees and sureties;
• disputes relating to implementation operations;
• closure due to insufficient assets or extinction of liabilities;
• the consequences of the procedure for the manager.

Our intervention also aims to anticipate the risks of personal liability for the manager and to defend his interests in any proceedings that may be initiated against him.

Advice to creditors

ARST Avocats advises suppliers, lessors, financial institutions, insurers, co-contractors and other creditors when a debtor encounters difficulties or is subject to collective proceedings.

Our services include, in particular:

• analyze the debtor's situation;
• secure future deliveries and services;
• renegotiate the payment terms;
• to establish or strengthen guarantees;
• to implement a retention of title clause;
• negotiate an amicable agreement;
• participate in an ad hoc mandate or conciliation procedure;
• declare a claim;
• request a statement of foreclosure;
• to respond to a dispute over a claim;
• participate in the verification of liabilities;
• to bring an action for recovery or restitution;
• to claim compensation;
• to have a subsequent claim recognized;
• to address the fate of an ongoing contract;
• implement a bond or independent guarantee;
• participate in the assigned game classes;
• to vote on or challenge a draft plan;
• to exercise the legal remedies available to the creditor.

We define a strategy taking into account the ranking of the claim, available security, the possible continuation of the business relationship and the real prospects for recovery.

Landlords and insolvency proceedings

The tenant's insolvency proceedings place the commercial landlord in a particular situation.

Our team assists landlords with:

• declare previous rents and charges;
• monitor the payment of subsequent rents;
• determine the treatment of occupancy claims;
• request the termination of the lease;
• to handle the continuation or transfer of the contract;
• to enforce guarantees and deposits;
• examine the situation of the guarantors;
• to contest the conditions of a lease assignment;
• recover the premises;
• to obtain payment for repairs or damages;
• defend their rights in a transfer plan.

We also advise companies in difficulty on the continuation, renegotiation or termination of their commercial leases.

Sureties, guarantors and directors

The opening of collective proceedings against a company does not necessarily erase the commitments made by its directors, partners or related companies.

ARST Avocats handles cases relating to:

• to personal guarantees;
• to independent guarantees;
• to first-demand guarantees;
• to letters of intent;
• to pledges and mortgages;
• to the guarantees provided by a company in the group;
• to the proportionality of the guarantee commitment;
• to the annual information of the guarantor;
• to the forfeiture of interest;
• to the implementation of the guarantee;
• to the payment deadlines requested by the guarantor;
• to the guarantor's recourse after payment.

We are examining the possibilities for negotiation with creditors and the means to challenge or limit the implementation of guarantees.

Taking over a struggling company

ARST Avocats assists entrepreneurs, groups, investors and funds wishing to take over a company, a business or assets within the framework of a collective procedure.

Our intervention covers, in particular:

• analysis of the opportunity for resumption;
• making contact with the administrator or the judicial liquidator;
• access to the data room;
• the legal audit of the activity;
• identifying the necessary assets and contracts;
• analysis of the commercial lease;
• the examination of intellectual property rights;
• the identification of transferred employees;
• environmental, social and regulatory risk assessment;
• the definition of the scope of the takeover;
• the determination of price and financing;
• the preparation of the takeover bid;
• drafting the candidate's commitments;
• improving the supply;
• preparing for the court hearing;
• the implementation of the transfer plan;
• the formation of the takeover company;
• post-return support.

Our team ensures that the offer complies with the requirements of the procedure and clearly outlines the means to ensure the sustainability of the business and the jobs taken over.

Business transfers and transfer plans

We also support companies in difficulty and their managers in preparing for a total or partial sale of the business.

This intervention may include:

• the identification of activities that could be sold;
• the preparation of information provided to candidates;
• the protection of confidential data;
• the organization of the data room;
• the determination of essential assets and contracts;
• analysis of the offers received;
• the comparison of financial, social and industrial commitments;
• the preparation of the manager's observations;
• coordination with the CSE and staff representatives;
• the preparation for the hearing to finalize the transfer plan;
• the execution of actions following the judgment.

When confidentiality and timing allow, a transfer prepared within the framework of an ad hoc mandate or conciliation can facilitate an organized takeover at the opening of the collective procedure.

Shareholders, investors and new funders

Our team advises partners and investors facing difficulties in a company in which they hold or are considering taking a stake.

We support them in:

• the analysis of their legal and financial exposure;
• the examination of partners' current accounts;
• negotiation with creditors;
• the recapitalization of the company;
• the contribution of new funds;
• the conversion of debt into capital;
• the entry of an investor;
• the dilution or restructuring of shareholding;
• the negotiation of new shareholder agreements;
• the protection of investments made;
• participation in the assigned game classes;
• the takeover of the company as part of a plan.

We coordinate these operations with our Corporate Law – Corporate M&A team.

Employees and staff representatives

A collective procedure directly affects employees, their claims, their employment contracts and the sustainability of their employment.

ARST Avocats assists employees, senior managers and staff representatives to enable them to understand the procedure and to protect their rights.

Our services include, in particular:

• verify the recording of wage claims on the statements;
• to dispute or supplement a statement of wage claims;
• examine the coverage by the AGS;
• to process unpaid wages, bonuses, leave and allowances;
• analyze the transfer of employment contracts;
• to support employees taken over in a transfer plan;
• examine the economic dismissals;
• check the order criteria and the reclassification searches;
• to control the calculation of severance pay;
• to support protected employees;
• advise the CSE during the procedure;
• to initiate the necessary legal proceedings before the competent courts.

When the firm advises the company or another party to the proceedings, this intervention naturally remains subject to prior verification of the absence of a conflict of interest.

Disputes arising from insolvency proceedings

ARST Avocats intervenes in disputes arising during or as a result of collective proceedings.

Our practice includes, in particular:

• the challenge to the state of insolvency;
• the setting or postponement of its date;
• requests for the opening of a receivership or liquidation procedure;
• third-party oppositions and appeals against judgments;
• disputes over claims;
• the foreclosure statements;
• actions for recovery and restitution;
• disputes relating to current contracts;
• the nullities of the suspect period;
• liability actions against directors;
• liability action for insufficient assets;
• personal bankruptcy or disqualification procedures;
• disputes relating to safeguard or recovery plans;
• disputes concerning transfer plans;
• appeals against decisions of the procedural bodies;
• disputes relating to the realization of assets;
• disputes between creditors regarding their ranking and security interests.

We represent clients before commercial courts, economic activity courts, judicial courts and courts of appeal throughout France.

International insolvency proceedings and groups of companies

The difficulties of a group can affect several companies, several establishments or several states.

Our team is involved in:

• the coordination of procedures concerning several companies within the same group;
• analysis of intra-group flows and agreements;
• the handling of cross-guarantees;
• the restructuring of the group's legal organization;
• the determination of the competent jurisdiction;
• the location of the center of main interests;
• recognition of proceedings initiated in another State;
• coordination with foreign councils;
• the protection of creditors or assets located abroad;
• preparing for a takeover with an international dimension.

This intervention is conducted, when necessary, with the corresponding firms and international partners of ARST Avocats.

A comprehensive approach to restructuring

Addressing a company's difficulties is not simply a matter of choosing a procedure. It requires understanding the business activity, cash flow constraints, relationships with creditors, the situation of employees, shareholder expectations, and the prospects for recovery or continuation.

ARST Avocats mobilizes its teams in restructuring, corporate law, social law, commercial law and litigation in order to offer a coherent strategy to each party concerned.

Are you looking for a lawyer specializing in insolvency law to anticipate a crisis, negotiate with your creditors, prepare for insolvency proceedings, defend a claim, or take over a business? Our team is available to analyze the situation and intervene quickly.