American Bankruptcy Institute
"Restructuring Limitations Faced by Title IV Educational Institutions"
A powerful and commonly utilized tool in a restructuring is the commencement by a company of an insolvency proceeding, whether under the Bankruptcy Code or analogous law, in order to achieve desired changes to its capital structure and/or operations. However, there are certain instances where, due to legal or commercial reasons, the use of an insolvency proceeding is not available. Depending on the complexity of a company’s capital structure and the required operational changes, the absence of this option can greatly complicate and/or limit the company’s restructuring.