PHASES OF CHAPTER 11 COMMUNICATIONS
In a Chapter 11 case, a well-developed, strategic communications program directed at the company's key audiences can make a very challenging period somewhat less difficult and facilitate the path to recovery.
AFA advises clients facing Chapter 11 reorganization proceedings to use a four-stage approach to communications:
Pre-Filing Preparation:
In the days or weeks preceding a Chapter 11 filing, the company should prepare for the initial flood of communications that will result from the filing. In this hectic time our professionals handle key communications tasks and provide clarity of purpose.
We prepare the company for the wave of inquiries by preparing press releases, web site content and communications to employees, vendors, landlords, etc. We also help establish call centers and email addresses as a means to disseminate information and respond to inquiries. If necessary, we prepare company management for dealing with the media.
Filing and Post-Filing:
This is the most critical communications time in a Chapter 11 proceeding. If a company is able to communicate effectively during the days immediately following the filing, it can greatly mitigate the initial shock to operations and smooth the transition into a Chapter 11.
We work diligently during this frenzied period to implement the communications strategies developed in the pre-filing phase, allowing the company's management and legal and financial advisors to focus on stabilizing the business. At the same time, we work to ensure that the company delivers a consistent message on all fronts.
Reorganization:
Once the initial stages of the Chapter 11 are complete, we work to ensure the corporate communications strategy highlights the reorganization efforts and successful steps the company takes to maximize the value of its assets.
Effective communications with the media and official and unofficial committees of creditor constituents can facilitate the reorganization efforts and attempts to gain court approval on key initiatives. We recognize the added importance during this phase of working closely with the other retained professionals so that the reorganization strategy and accomplishments are publicized appropriately.
Plan of Reorganization:
When the time comes for the debtor to file its Plan of Reorganization, we will work in conjunction with management and legal and financial advisors to provide communications supporting the process of seeking and obtaining court approval of the debtor's disclosure statement and plan of reorganization.
Since the plan negotiation and approval process can often take several months to complete, we are conscious of and attentive to the need to modify a debtor's communications strategy during this time to reflect the ever-changing dynamics of plan negotiations.