Hain Capital Group

If you are holding a claim against a company in bankruptcy you may have been contacted by us or other prospective buyers who may wish to make you an offer for your claim. The following is intended to answer some of the questions you may have about selling your claim.

  • How did you find me? (read answer)
     
  • Why doesn't the debtor just pay me? (read answer)
     
  • What if the consideration you receive from the Debtor is worth less than what you
        paid me for the claim? Will you demand your money back? (read answer)
     
  • Why should we sell our debt? (read answer)
     
  • What recovery rate do creditors usually get from debtors? (read answer)
     
  • Is Hain Capital a broker? (read answer)
     
  • Aren't all trade claim buyers the same? (read answer)
     
  • How does Hain Capital determine a price? (read answer)
     
  • When do I get my cash? (read answer)
     
  • Does Hain buy priority claims? (read answer)
     
  • What if the Debtor does not list the amount it owes me correctly? Does Hain buy
        claims that are classified as contingent, unliquidated or disputed? (read answer)
     
  • If Hain wants to buy a claim, doesn't that mean it's worth something? (read answer)
     
  • Will the debtor view me unfavorably for having sold my receivable? (read answer)
     
  • Is Hain Capital affiliated with the debtor or the court system? (read answer)
     
  • Is the process confidential? (read answer)
  • How did you find me?
    We obtained your contact information from public bankruptcy documents. We believe we provide a valuable service that may be of interest to you. (Back to top ^)


    Why doesn't the debtor just pay me?
    The Bankruptcy Code states that the filing of a petition with the court stays all actions against the debtor. This prevents you from pursuing remedies against the debtor's assets or taking other actions. (Back to top ^)


    What if the consideration you receive from the Debtor is worth less than what you paid me for the claim? Will you demand your money back?
    No. While Hain Capital Group will require that the claim it is buying is a legitimate claim backed by evidence, its standard documentation does not include recourse with regard to recovery percentage. (Back to top ^)


    Why should we sell our debt?

  • Immediate Liquidity. According to Standard & Poor's, the typical length of a major Chapter 11 reorganization from the initial filing of the petition to the actual distribution to creditors of funds or securities (if any) is nearly three years. Indeed, recovery (if any) to trade claimants usually takes an additional several months from the effective date of a plan of reorganization. The sale of your trade claim will result in the immediate conversion of your non-performing receivable into cash.
  • Elimination of Bankruptcy Review and Correspondence. Typically, Chapter 11 reorganization requires a great deal of correspondence between the debtor, the bankruptcy court, and creditors. The sale of your trade claim will curtail the correspondence to you and eliminate your responsibility to follow the proceedings.
  • Elimination of Recovery Risk. Hain eliminates your recovery risk. Hain is a fund specializing in distressed companies and thus is able to spread this risk over Hain's large portfolio of investments.
  • Elimination of Consideration Risk. In successful reorganizations, creditors can receive cash, bonds, stock, or a combination thereof. Often, and particularly in smaller bankruptcy cases, bond and stock consideration paid cannot be liquidated efficiently.
  • Potential Tax Advantages. There may be tax advantages associated with selling your claim. Please consult with your tax advisor for details.
  • Potential Accounting Advantages. There may be accounting advantages associated with selling your claim. Please consult with your accountant for details.
     (Back to top ^)


    What recovery rate do creditors usually get from debtors?

    Each case is unique. In perhaps the majority of cases, there is virtually nothing left to pay unsecured claims after administrative expenses and secured creditors are paid. Furthermore, distributions, if there are any to be made, could take months or even years to materialize. A dollar today is worth much more than a dollar in a year's time, particularly when the released cash can be used to re-invest in your business. (Back to top ^)


    Is Hain Capital a broker?
    Hain Capital is an investment management firm with a large amount of available capital. Hain Capital purchases claims on a principal basis. (Back to top ^)


    Aren't all trade claim buyers the same?
    No. Hain Capital provides an exceptional level of service and competitive pricing to its customers, as evidenced by its customers' written testimonials. Also, Hain Capital is a member of Trade Claim Buyers Association ("TCBA"), a trade association that promotes standards and practices in the trade claims business. The TCBA promotes timely docketing and payment and other practices and standards that are fair and beneficial to the business.

    We are confident that when you do your due diligence, you will choose Hain. (Back to top ^)


    How does Hain Capital determine a price?
    Hain employs experienced personnel with a background in distressed reorganizations. These personnel analyze a company, its chances for survival, trends in its industry and the legal challenges it faces. Hain Capital then determines whether a recovery is possible and the timing and form of any potential distributions. (Back to top ^)


    When do I get my cash?
    Typically, within five business days of the execution of documentation. (Back to top ^)


    Does Hain buy priority claims?
    Certainly. Hain Capital purchases all types of priority claims including administrative, secured, lien, tax, reclamation and 503(b)(9) claims. (Back to top ^)


    What if the Debtor does not list the amount it owes me correctly? Does Hain buy claims that are classified as contingent, unliquidated or disputed?
    Hain Capital will pay you for your scheduled claim based on the amount shown on schedules filed with the bankruptcy court. Please contact Hain Capital for details regarding other claim types. (Back to top ^)


    If Hain wants to buy a claim, doesn't that mean it's worth something?
    While Hain would like to claim that Hain's personnel are prescient, that is simply not the case. Hain and other firms often purchase claims that are ultimately worthless. An unfortunate feature of bankruptcy reorganizations is that the direction of a case can change extremely rapidly in ways that simply cannot be predicted, even by experts. (Back to top ^)


    Will the debtor view me unfavorably for having sold my receivable?
    As anyone who has been involved in a bankruptcy knows, the debtor is in a struggle for its survival. Tracking the activities of suppliers with respect to pre-petition amounts is very low on a debtor's list of priorities. Simply providing any terms on post-petition shipments (which will incidentally be accorded administrative expense priority by law) will make your customer very happy and will improve its chances. (Back to top ^)


    Is Hain Capital affiliated with the debtor or the court system?
    No. Hain Capital is an independent investment fund. (Back to top ^)


    Is the process confidential?
    While court proceedings are generally a matter of public record, Hain is very careful to not disclose any confidential information, including the price paid. (Back to top ^)
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