Restructuring
Restructuring consulting (scenarios, representation)
The KMS Law Firm specializes in providing entrepreneurs with comprehensive services related to restructuring consultancy in a scope that maximizes the chances of effective implementation of restructuring procedures.
The KMS Law Firm gets acquainted with the economic condition and the debt of the enterprise and identifies legal and management risks, making findings regarding existing restructuring opportunities, as well as concluding research activities with an appropriate recommendation, formulating in particular restructuring areas and hypotheses.
In proceedings for approval of an arrangement (which is one of the four separate restructuring mechanisms), the arrangement supervisor is selected by the debtor, performing his function on the basis of an agreement concluded with the debtor. As part of his activities, the court supervisor, inter alia, draws up a restructuring plan, prepares arrangement proposals together with the debtor, cooperates with the debtor in the efficient and lawful collection of votes and submits a report to the restructuring court on the possibility of implementing the arrangement.
The KMS Law Firm offers comprehensive support for the debtor at various stages of the restructuring proceedings, including:
- advice on restructuring strategy,
- audit of enterprises (identification of areas capable of restructuring),
- examination of negative premises for restructuring (ineffective legal acts of the debtor),
- preparation of applications for opening restructuring proceedings,
- representation of the debtor in the course of proceedings to open restructuring proceedings and appropriate proceedings,
- creating restructuring plans (related to the statutory requirements of Polish Restructuring Law), including – examining the causes of insolvency or the threat of insolvency,
- representation in terms of establishing a repayment plan,
- advice on the procedure of establishing a repayment plan,
- creating arrangement proposals:
- for formulation of arrangement proposals,
- for examination of the legality of arrangement proposals,
- testing the feasibility and probability of the implementation of the arrangement,
- specifying the selection criteria in a partial arrangement,
- determining criteria for building credit groups.
The Law Firm also has experience in the area of expert opinions on the fulfillment of negative conditions for approval of the arrangement by the Restructuring Court (article 165 Polish Restructuring Law).
The Law Firm offers to prepare a private creditor test or a private investor test, in accordance with the wording of article 140 Polish Restructuring Law, which stipulates, that such a test should be performed if – in the course of restructuring proceedings – the enterprise may be granted support by the state or through state resources in any form, in particular by reducing the amount of liabilities by way of an arrangement, dividing the repayment into installments, postponement of the deadline for performance of obligations or suspension, by operation of law or on the basis of a court or judge-commissioner order, of enforcement proceedings conducted in order to claim claims, granting loans, credits, sureties or guarantees.
We offer economic, legal and procedural support for those creditors whose debtor has become insolvent. We advise on how to protect your interests and how to optimally use the existing restructuring law instruments, which are available to creditors (e.g. application for compulsory receivership). We perform an economic and legal analysis of arrangement proposals in the context of financial benefits and identification of the existing risks related to the performance of the arrangement by the debtor. We supervise the restructuring proceedings in terms of the creditor’s interest, striving to maximize the benefits resulting from participation in the restructuring proceedings.
Insolvency
KMS has been providing specialized services related to bankruptcy law since 2011, in the following areas:
1. advising on a bankruptcy strategy in the context of the interests of the debtor or creditor,
2. representation of the debtor or creditor during the bankruptcy and proper proceedings (e.g. preparation of a bankruptcy motions with attachments),
3. pre-pack transaction consultancy, including:
- the valuation of the subject of sale,
- the formulation of an application for approval of the terms of sale,
- representation of the debtor or creditor in the proceedings for approval of the terms of sale,
4. expert opinions in the course of bankruptcy proceedings,
5. consumer bankruptcy of former entrepreneurs,
and other areas.
Pre-pack
KMS Law Firm offers comprehensive services in the field of coordinating the pre-pack liquidation process in accordance with article 56a-h of the Polish Bankruptcy Law. Law Firm – including Court Watch Polska Foundation – also co-creating a report on the functioning of the prepared liquidation in Poland, containing many detailed statements and data illustrating the practical dimension of the functioning of the pre-pack in Polish legal reality.
The law firm’s experts have both the necessary theoretical preparation and extensive practical experience, consisting of involvement in various types of bankruptcy proceedings conducted in Poland in the variant of prepared liquidation.
The law firm has had numerous successes in the pre-pack area, incl. such as:
- approval by the Court of the terms of sale of an enterprise consisting of a number of real estate with a value of over several dozen million zlotys in accordance with the request of the creditor represented by the Law Firm,
- approval by the Court of the conditions of sale of an enterprise in the construction industry with a value of twenty million zlotys, as requested by the debtor represented by the Law Firm,
- approval by the Court of the terms of sale of an enterprise consisting, inter alia, from a commercial property with a value of several million zlotys as requested by the debtor represented by the Law Firm,
- approval by the Court of the terms of sale of a company from the specialist IT services industry in accordance with the request of the debtor advised by the Law Firm,
- approval by the Court of the terms of sale of the property of the insolvent consumer represented by the Law Firm in consumer bankruptcy.
in the field of restructuring consultancy and representation before the Court
- preparation of an application for bankruptcy of the indebted company, together with an application for approval of the terms of sale pursuant to article 56a paragraph. 1 Polish Bankruptcy Law (prepared liquidation), as well as preparation of the necessary economic and legal argumentation in the field of materialization of the premises for insolvency, the company’s debt capacity to bear the costs of bankruptcy proceedings, as well as the proper quantification of the sale price of the subject of the prepared liquidation in accordance with the provisions of the bankruptcy law,
- making a complaint pursuant to article 56d paragraph. 2 Polish Bankruptcy Law for a possible decision dismissing the application for approval of the terms of sale
- legal representation of a creditor or debtor in proceedings for a declaration of bankruptcy of a indebted company, in particular representation before a bankruptcy court, temporary court supervisor / compulsory receivership over assets (including – taking a position and validating a possible report referred to in article 38 (3) of the Polish Bankruptcy Law), as well as before the District Court in possible appeal proceedings,
- coordination of the work of court experts involved in the valuation of the subject of the pre-pack, in particular by verifying whether the prepared description and estimate meet the normative requirements of article 56a-h Polish Bankruptcy Law and article 319 Polish Bankruptcy Law.
for the preparation of an inventory and estimation
• preparing a description and estimation of the subject of the prepared liquidation pursuant to article 56a paragraph. 3 of the Polish Bankruptcy La, i.e. for the purposes of the application for approval of the terms of sale referred to in article 56a paragraph. 1 Polish Bankruptcy Law during the prepared liquidation (pre-pack) by an authorized expert conducted in the list of court experts.
Managers’ duties
In the current legal framework, the examination of insolvency in order to determine the materialization of possible premises for insolvency (article 11 of the Polish Bankruptcy Law) has key importance for many legal areas. Starting from the obligation to submit a bankruptcy petition within the statutory deadline and a criminal sanction related to failure to comply with this obligation (Article 586 of the Polish Commercial Companies Code), through subsidiary liability of management board members for the company’s obligations under article 299 of the Polish Code of Commercial Companies and article 116 of the Polish Tax Ordinance, up to a number of legal and criminal risks related to operating in conditions of insolvency or threat of insolvency (e.g. article 300-302 of the Polish Penal Code).
The KMS Law Firm offers a comprehensive insolvency test in the context of the liquidity (Article 11 paragraph 1) of the Polish Bankruptcy Law) and property (Article 11 paragraph 2 of the Polish Bankruptcy Law), the integral part of which is the opinion prepared by the court expert Jakub Michalak.
It is worth emphasizing that the Law Firm has many years of experience in this area, giving opinions on the fact of establishing insolvency in several dozen companies, including listed companies. Opinions prepared by expert Jakub Michalak turned out to be procedural, and often also decisive, in many bankruptcy cases (in the old legal state), cases for payment under article 299 of the Polish Commercial Companies Code and in criminal and legal matters.
The Law Firm’s experts are also involved in scientific and journalistic activities in the field of insolvency research, which is manifested by, among others, two articles in the „Doradca Restrukturyzacyjny” concerning the methodology of examining the premises of insolvency (written by partners of the law firm, Jakub Michalak and Bartosz Sokół), as well as quotations in the leading comments on bankruptcy law.
The combination of knowledge and theoretical tools with many years of experience and understanding of business mechanisms means that the services offered by the Law Firm in the field of insolvency testing have been appreciated by clients for many years, and have also turned out to be effective and useful in the process.
KMS law firm specializes in crimes and economic offenses related to acting to the detriment of the managed entity or creditors, in particular in conditions of bankruptcy, including based on the following regulations:
- Article 286 Polish Penal Code – fraud,
- Article 296 Polish Penal Code – abuse of powers or failure to fulfill obligations,
- Article 300 Polish Penal Code – frustrating or reducing the satisfaction of the creditor,
- Article 301 Polish Penal Code – apparent bankruptcy,
- Article 302 Polish Penal Code – favoring creditors,
- Article 586 Polish Penal Code – failure to file a bankruptcy petition on time,
- Article 57 Polish Fiscal Penal Code – violation of the tax payment deadline,
- Article 77 Polish Fiscal Penal Code – failure to pay the collected tax.
The law firm conducts a legal, management and economic analysis of the facts in the case, which results in the provision of arguments and formulation of the client’s procedural strategy or a written expert opinion prepared by the expert. Experts KMS are conducted on the list of court experts in the scope corresponding to the above legal standards:
- determining the moment of occurrence of premises for declaration of bankruptcy for the purposes of proceedings regarding the liability of members of the management board of limited liability companies in connection with article 299 of the Polish Commercial Companies Code and members of the management board of commercial companies in connection with Article 116 of the Polish Tax Ordinance and in connection with Article 373 of the Polish Bankruptcy Law, as well as the moment of threat of insolvency in context of article 300-302 of the Polish Penal Code,
- estimating the value of the creditors’ losses in proceedings under Article 299 of the Polish Commercial Companies Code, and in the context of Article 373 of the Polish Bankruptcy Law,
- examination of the economic and financial capacity of business entities for establishing or contradicting the objective possibility of paying the tax (or its advance payment) to the tax authority on the date of the tax payment deadline, i.e. in the context of the infringement of Article 57 Polish Fiscal Penal Code – and the prohibited act under Article 77 Polish Fiscal Penal Code
- examining the rationality and legitimacy of management decisions in connection with criminal liability referred to in Art. 296 of the Penal Code in connection with with art. 308 of the Polish Penal Code, as well as establishing the permissible framework of economic risk, which is specific to the environment of the enterprise / business unit.
The uniqueness of the services provided by the Law Firm in the above-mentioned scope consists in combining economic and legal knowledge in order to make economic and managerial interpretation of specific economic events within the framework of penal typifications. The synthesis of economic and legal knowledge results in high procedural efficiency of the services provided by the Law Firm.
Due dilligence and valuation
KMS Law Firm offers services in the field of valuation of enterprises, organized parts of enterprises and other assets, especially for the purposes of bankruptcy and restructuring proceedings, including the process of prepared liquidation (the so-called pre-pack) pursuant to article 56a-h of Polish Bankruptcy Law.
The law firm has extensive experience in the valuation of enterprises and their components for the purposes of:
- sale of the enterprise in its entirety during the bankruptcy proceedings,
- sale of the enterprise as part of prepared liquidation (the so-called pre-pack),
- division proceedings after the cessation of marital property,
- an insolvency test pursuant to article 11 section 2 of the Polish Bankruptcy Law,
- payment of the share after a partner withdraws from the general partnership pursuant to Art. 65 of the Commercial Companies Code,
- establishing the value of the enterprise for tax purposes (including tax on civil law transactions),
- establishing the value of the enterprise for the purposes of criminal and penal-fiscal proceedings.
The company valuation is prepared on the basis of global and national standards of company valuation, with particular emphasis on the legal provisions that are relevant in the given facts. The valuations offered by the Law Firm are therefore not only complete and reliable in terms of valuation standards, but are also based on a comprehensive economic interpretation of the relevant legal provisions relating to valuation.
What can we do for you?
info@kmsbiznes.pl
+48 32 307 50 00
+48 22 122 02 50