The Insolvency Response Matrix
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Is Your Company Safe From Insolvency Risk?

While your balance sheet and income statement may be strong, have you looked at your suppliers?  Can you operate for long if a critical supplier cannot perform?

For close corporations, the dissenting shareholder or member could create financial risks through buyout demands, derivative claims or dissolution threats that can turn a solid balance sheet upside down overnight.  Are their contract obligations that may become uneconomic or even ruinous if they ar not renegotiated? 

 
   
 
Insolvency Response Matrix

 

The Insolvency Response Matrix is an analytical tool the the Special Financial Services Law Group practice employs to evaluate the impact of the insolvency of a target company or stakeholder on the business of a client.  In some case, the client is the company experiencing financial distress and the analysis focuses upon the relationships between the client and various stakeholders and constituencies whose own economic future is tied to the client.

The analysis is designed to provide our clients with the information they need to evaluate there current business practices, agreements and plans in light of the impact of insolvency and possible litigation, bankruptcy or business interruption that may arise.  A vital supplier in financial distress may be a critical source of supply.  A customer seeking long terms service and supply commitments that require a client to make significant investments may create serious financial risk to a client in the event of a financial reversal.

For clients who foresee financial challenges in their own business, an understanding of the impact of their insolvency risk on their own stakeholders provides essential information for planning and pursuing a restructuring and reorganization option.

The  Special Financial Services Law  Group provides guidance, legal counsel, and advice to clients who face these issues.

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