Subchapter V offers companies with less than $7.5 million of qualifying liabilities an opportunity to reorganize in Chapter 11 using a more efficient and streamlined process. Many debts are excluded from this threshold – for example, unmatured lease liabilities and debts owed to insiders and affiliates – opening Subchapter V up to a wide array of middle-market companies across all major business sectors and industries, including retail, health care, financial services, energy, construction and transportation. Led by Partner George Angelich, our team has deep experience representing debtors, creditors, shareholders, and fiduciaries in Subchapter V cases across the country, including complex international situations involving dual restructurings and sales, reorganizations, and liquidations of domestic subsidiaries of foreign parent companies.
Subchapter V cases proceed on an expedited timeline, give the debtor the exclusive right to file a plan of reorganization, allow the Bankruptcy Court to approve that plan without creditor support, and do not (typically) feature a creditors’ committee. These and other nuances require experience and expertise to navigate successful client outcomes. Our team features thought leaders and counselors with a strong collective track record of developing and executing highly effective restructuring strategies tailored to each business and the objectives of key stakeholders. In 2022, the M&A Advisor recognized our representation of CoverFX in connection with its sale and restructuring in Subchapter V as the Chapter 11 Reorganization of the Year (Between $10MM and $100MM).
Subchapter V Resources
Key Events in the Timeline of Subchapter V Cases
Subchapter V Experience
In re G-Star Raw Retail Inc., et al., Case No. 20-16040 (Bankr. C.D. Ca.)
In re Summit Financial Inc., Case No. 8:21-BK-12276-SC (Bankr. C.D. Ca.)
In re CFX US Co., Inc., et al., Case No. 22-10022 (DSJ) (Bankr. S.D.N.Y.). Arentfox Schiff represented cosmetics company CoverFX (k/n/a CFX) in formulating and executing a successful multi-step restructuring process. We negotiated and executed consensual resolutions with secured and unsecured creditors, the sale of the company’s brand and inventory, and the confirmation of a Subchapter V plan within 48 days of the U.S. and Canadian companies’ chapter 11 filings. In 2022, the M&A Advisor awarded the ArentFox Schiff team of George Angelich, Justin Kesselman and Patrick Feeney Chapter 11 Reorganization of the Year (Between $10MM and $100MM) for this engagement.
In re New York Classic Motors, LLC, Case No. 21-10670 (MG) (Bankr. S.D.N.Y.)
In re Parking Management, Inc., Case No. 20-15026 (TJC) (Bankr. D. Md.)
Subchapter V Publications & Speaking Engagements
- George P. Angelich & Justin A. Kesselman, Panelists, Commercial Collection Agencies of America Annual Conference, Subchapter V: Unlocking Value in “Small Business” Bankruptcies, October 20, 2022.
- George P. Angelich, M. Douglas Flahaut & Justin A. Kesselman, Panelists, The National Association of Credit Management Annual Credit Congress, Subchapter V: Strategies for Unsecured Creditors to Maximize Value and Key Developments, June 7, 2022.
- George P. Angelich, Panelist, “A New Frontier or the Wild Wild West: Practice Considerations in Subchapter V Cases”, ABA, Business Law Section Hybrid Spring Hybrid 2022, March 31, 2022.
- George P. Angelich, M. Douglas Flahaut & Justin A. Kesselman, Panelists, The Credit Research Foundation Forum, The Creditor’s Roadmap Through Subchapter V: Finding Value in “Small Business” Bankruptcies, March 15, 2022.
- George P. Angelich, Justin A. Kesselman, & Patrick Feeney, “Small Business Reorganization Act in Practice: Issues and Strategies for Creditors in Small Business Bankruptcies”, Credit Research Foundation’s publication, Perspective by CRF, Q4 2021.
- George P. Angelich & Justin A. Kesselman, Panelists, Group Legal Services Association, Recent Developments in Bankruptcy, November 4, 2021.
- M. Douglas Flahaut, Panelist, Association of Insolvency & Restructuring Advisors’ 37th Annual Bankruptcy & Restructuring Conference, The Small Business Reorganization Act of 2019 – An Experiment Towards Success, June 30, 2021.
- George P. Angelich, Speaker, "Saving Small Businesses: Subchapter V, A Lifeline & Toolkit, Part 1 and 2," New York State Bar Association, April 16 & 23, 2021.
- M. Douglas Flahaut & Justin A. Kesselman, Panelists, Subchapter V: Getting the Most Out of Small Business Reorganizations, Credit Research Foundation, March 15, 2021.
- George P. Angelich, Speaker, Credit Research Foundation, Subchapter V: V Key Takeaways in Five Minutes, March 2, 2021.
- M. Douglas Flahaut, Central District Consumer Bankruptcy Attorneys’ Association, One Year Into SBRA: Meet the Subchapter V Trustees, February 20, 2021 (speaker).
- George P. Angelich, Panelist, “NYIC: The Small Business Reorganization Act: Perspectives from all the Major Players in a Case,” Insolvency 2020: Restructuring, Insolvency & Distressed Debt Virtual Summit, October 22, 2020.
- M. Douglas Flahaut, Speaker, Association of Insolvency & Restructuring Advisors’ 36th Annual Bankruptcy & Restructuring Conference, Small Business Reorganization Act of 2019: What you Need to Know Going Forward, June 9, 2020.
- M. Doughlas Flahaut & Justin A. Kesselman, Author, “COVID-19 Stimulus Legislation Aims to Make Chapter 11 Easier for Many More Small Businesses”, Daily Journal, April 2020.