A panel of top attorneys and credit/financial professionals led an illuminating Credit Congress session on Creditors' Committees. One of the top takeaways from the session was that ensuring communication among all members of the committee, especially with hired financial professionals as early in the process as possible, can be crucial for unsecured debtors to maximize their returns in reorganization.
Panelists William Lenhart, CPA, of BDO Seidman, and Bruce Nathan Esq., of Lowenstein Sandler PC both talked about the difficulty and lack of quality communication present in the unsuccessful Circuit City reorganization. "Years ago, they would have figured out a way to reorganize...They lost confidence and liquidated," Lenhart said.
Former NACM Chairman Val Venable, CCE, SABIC Innovative Plastics, suggested the first move of creditors is establishing its unofficial "Bill of Rights" that addresses issues such as conduct, frequency of meetings and who can call meetings, among other things. "They provide an understanding of what is expected from everyone, and they clearly articulate that so there are not big surprises. Everybody has to know everybody else's expectations for a successful reorganization."
Brian Shappell, NACM staff writer