The Assignment Process
Throughout the Assignment for the Benefit of Creditors process, the attorneys at Leiderman Shelomith Alexander + Somodevilla, PLLC (“LSAS Law”) will be with you every step of the way. Prior to the commencement of the assignment process, LSAS Law attorneys will spend significant time with the company’s principals conducting extensive due diligence and vetting the company’s various assets, and determining the company’s liabilities (even those that may not have matured) and potential issues that may arise later in assignment process. This process is employed in order to validate and ascertain whether the strategic objectives of the assignment would be in fact attained through the assignment process.
Assuming that the assignment process remains the preferred strategy, LSAS Law will come-up with a list of potential assignees to choose from, and facilitate meetings and discussions with same. Once the client selects the Assignee, and the Assignee agrees to undertake the assignment case, a team from LSAS Law, led by one of its attorneys, will work on drafting the schedules and documenting the assignment. While this process is taking place, LSAS Law attorneys will maintain on-going communication with the prospective assignee to determine optimal timing to commence the assignment.
The assignment case is commenced upon the signing of the assignment documents and handing over the document to the Assignee. Within 30 days of commencement of the assignment, the Assignee will be required to conduct the deposition of key principal of the company. Typically, in advance of the deposition, the Assignee will engage with the company’s key personnel to secure documents, and may request additional documents pertaining to the company. These documents are used by the Assignee to determine the company’s financial state of affairs prior to the assignment, and whether the company is owed any monies or whether certain assets that were transferred to third parties may need to be recovered.
During this initial period, the Assignee may require additional help from the company’s former principals, and has the option to operate the company with an eye toward preserving the assets as a going concern to be sold to highest bidder at an auction. LSAS Law will assist the client during this process to ensure that it goes as smoothly an efficiently as possible.