How Successful Liquidation Eliminated Personal Guarantees for Owners of Restaurant Equipment Supplier

September 30th, 2013

Chapter 7 bankruptcy case liquidation results in satisfaction of all personal guarantees.

The Company:
A San Francisco Bay Area restaurant equipment supply company.

The Problem:
This flagging economy reduced the value of the company's accounts receivable and inventory, placing it in breach of the borrowing base covenant under its commercial loan agreement. The bank froze the line of credit and declared the balance immediately due and owing.

The Solution:
During this chapter 7 bankruptcy case, Macdonald Fernandez LLP worked closely with the trustee to ensure that the assets would be sold in the manner that would fetch the highest price. Specifically, rather than selling the assets individually (which would not attract big buyers) and rather than selling them in bulk (which would have cut out smaller buyers), a creative approach was used to bring all interested buyers to the table.

The Impact:
Our unique approach to this case resulted in a successful liquidation of assets and satisfaction of all personal guarantees. This level of skill and close attention is important for anyone who needs to maximize value and minimize liabilities.