Automotive Industry in Crisis: What You Need to Know About a Chapter 11 Case

The automobile industry continues to face unprecedented liquidity pressures and survival challenges. In this difficult market, the media and industry experts predict a wave of bankruptcies for both suppliers and OEMs, actions that will have widespread impact throughout the industry and beyond.

In our continuing analysis and coverage of the automotive industry, Foley hosted the next installment of our briefing series. In this session, Foley’s Automotive Industry Crisis Response Team and Miller Buckfire explained the fundamentals of a Chapter 11 case and how the current credit crisis affects debtors and creditors in bankruptcy.

Topics included:

• Timing and triggers for a Chapter 11 filing
  
• Objectives of a Chapter 11 filing and how to emerge
  
• Key facets of a Chapter 11 proceeding, including:
  
  
  
  
  
  • Debtor-in-possession (DIP) financing
    
  • Use of cash collateral
    
  • Assumption and rejection of contracts/sale of assets free and clear
    
  • Negotiations with key constituents, including labor, bondholders, and other creditors
    
  • Pre-packaged bankruptcies (prepacks)
    
  • Plans of reorganization and confirmation requirements
    
  • Exit financing
  
  
• The capital markets’ receptiveness to automotive industry deals
  
• The difference between a financial and operational restructuring
  
• The possibility of out-of-court restructuring

Presenters:

• Judy A. O’Neill
  Partner, Automotive Industry Team, Foley & Lardner LLP
  Chair, Bankruptcy & Business Reorganizations Practice
  Chair, Automotive Industry Crisis Response Team
  
• Ann Marie Uetz
  Partner, Automotive Industry Team and Bankruptcy & Business Reorganizations Practice, Foley & Lardner LLP
  
• Durc A. Savini
  Managing Director and Head of Auto Supplier Advisory Practice, Miller Buckfire

For more information, please contact Jennifer Bartz at jbartz@foley.com.