Restructure This! Episode 27: What You Always Wished You Knew About Assignments for the Benefit of Creditors with David M. Johnson and Molly Froschauer of Resolution Financial Advisors

Sheppard Mullin's Restructure THIS! podcast explores the latest trends and controversies in Chapter 11 bankruptcy, commercial insolvency and distressed investing. In this week's episode, David Johnson and Molly Froschauer of Resolution Financial Advisors join host Justin Bernbrock to discuss Assignments for the Benefit of Creditors (ABCs), including advantages and disadvantages compared to traditional bankruptcy options, the various ways an ABC can be leveraged and the acquisition opportunities they offer potential buyers.

 

What We Discussed in this Episode

• What is an Assignment for the Benefit of Creditors?

• What are the advantages and disadvantages of an ABC compared to traditional bankruptcy proceedings?

• What cost and jurisdictional factors should a distressed company or its board of directors consider when evaluating the various options?

• How can an ABC be leveraged as an operating company, a going-concern sale or even a prepackaged ABC?

• How can potential buyers learn about acquisition opportunities involving ABCs?

• Are there specific companies and industries that aren’t well-suited for an ABC?

 

About the Guests and Host

About David M. Johnson, CFA

David M. Johnson, CFA, is an accomplished executive with more than 25 years of experience in financial advisory and business restructuring roles. He has honed his skills advising startups, venture-backed companies and established businesses through complex crises, guiding over 400 companies toward recovery and resilience. 

Before co-founding Resolution, David served as Senior Managing Director at a middle-market advisory firm, guiding distressed companies for 17 years. He also spent four years with Alvarez & Marsal, Inc., a global turnaround management firm, providing interim management and forensic accounting services for clients that included a national healthcare organization. His expertise spans corporate turnarounds, insolvency management, sales and acquisitions, financial modeling, and valuations. 

 

About Molly Froschauer

Molly Froschauer is an experienced insolvency professional who has been advising on bankruptcy and distressed corporate situations for over a decade. Before joining Resolution, she spent seven years with middle-market professional services firms, specializing in corporate distress. Molly’s career also includes practicing as a bankruptcy attorney and serving as a general manager for an out-of-court insolvency service provider and liquidation agent. Her work has spanned managing creditor meetings, advocating for business debt solutions and educating trade creditors on navigating debt resolution.

As an editor for the National Association for Credit Management’s Manual of Credit and Commercial Laws, Molly oversaw more than 50 Assignments for the Benefit of Creditors, out-of-court workouts and engagements through the bankruptcy courts.

 

About Justin Bernbrock

Justin Bernbrock is a partner in the Finance and Bankruptcy Practice Group in Sheppard Mullin's Chicago office, where he focuses on all aspects of corporate restructuring, bankruptcy and financial distress. He represents clients across a wide range of matters, including debtor and creditor representations. He has substantial experience in out-of-court and in-court restructurings, primarily in the Southern District of New York, Eastern District of Virginia, District of Delaware and Southern District of Texas.

 

Contact Information

David M. Johnson, CFA

Molly Froschauer

Justin Bernbrock

 

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This podcast is for informational and educational purposes only. It is not to be construed as legal advice specific to your circumstances. If you need help with any legal matter, be sure to consult with an attorney regarding your specific needs.