CRG Financial LLC (CRG) is an investment firm that provides liquidity to creditors who are holding debt against bankrupt companies (“debtors”) by purchasing their receivable. CRG offers creditors of certain debtors an opportunity to sell their receivables (known as “claims”) for an immediate cash settlement.

The Chapter 11 filing precludes the debtor from paying obligations, including obligations to many of its vendors and suppliers, incurred before the date that it filed for bankruptcy protection. Invoices for these obligations are now considered pre-petition claims and will be dealt with through the bankruptcy process.

Elimination of Recovery Risk: Unsecured creditors are the last creditors in line to receive distributions. In many cases, recoveries are low or non-existent for unsecured claims after administrative expenses (lawyer and advisor fees) and secured creditors are paid. Selling your non-performing claim for cash allows you to secure a definitive recovery, eliminating the risk of an uncertain bankruptcy outcome.

Immediate Cash Conversion: The average duration of a corporate bankruptcy case is approximately 1-2 years from the petition date to the plan effective date, but many cases take far longer due to litigation, disputes between creditors, facility shutdowns, and labor issues. Selling your non-performing claim for cash eliminates the time risk associated with a bankruptcy case and allows you to immediately re-invest the proceeds back into your business.

Elimination of Consideration Risk: Assuming there is sufficient value remaining at the conclusion of a bankruptcy case, unsecured creditors may receive distributions of notes, stock, cash or a combination thereof. Notes and stock are difficult and costly to liquidate and often cannot be sold immediately. Selling eliminates the risk of receiving illiquid securities.

Elimination of Time and Cost associated with the Bankruptcy Process: Corporate bankruptcy cases involve a great deal of paperwork and correspondence between the Debtor, the bankruptcy court and creditors. Selling your non-performing Trade Claim for cash eliminates the time, money and valuable human resources required to follow and participate in a bankruptcy case from beginning to end.

Potential Tax Benefit: Selling may provide your company with a tax benefit by applying the loss on the uncollected portion of your receivable against current Income. Please consult with a tax professional for advice on your specific situation.

The entire process from first contact to receiving your funds can be completed within a few days. CRG can wire payment within 24-48 hours of receiving the complete documentation on the claim.

The Chapter 11 filing precludes the debtor from paying obligations, including obligations to many of its vendors and suppliers, incurred before the date that it filed for bankruptcy protection. Invoices for these obligations are now considered pre-petition claims and will be dealt with through the bankruptcy process.

If you are a creditor in a Chapter 11 bankruptcy case, you may be required to file a Proof of Claim in the bankruptcy court in order to validate your claim against the Debtor. CRG highly recommends companies file a Proof of Claim to help with the claims reconciliation process. If you are a creditor in a Chapter 7 bankruptcy case, you need to file a proof of claim.

Please call today to discuss your options.