Corporate Reorganization

This course examines the reorganization of a financially distressed company under Chapter 11 of the Bankruptcy Code. We will examine reorganization through several stages of a business turnaround and restructuring (such as an out-of-court workout, a Chapter 11 filing, selected Chapter 11 operating issues, and the Chapter 11 plan of reorganization). We will also consider a few controversial issues that test the boundaries of bankruptcy law. For example, can an asset sale be structured as a disguised reorganization plan that dispenses with certain procedural and substantive Chapter 11 plan requirements? Can a Chapter 11 plan provide for a non-consensual release of a claim held by one third party against another third party? Along the way we will touch on issues that often arise in a reorganization setting such as valuation, leveraged buyouts, debt instruments, distressed debt investing, and third-party releases. We will also follow current developments in actual Chapter 11 cases, primarily through reports in the media. Elements used in grading: class participation and final exam.