Wandro Attorneys Assist Farm Clients in Confirming Chapter 12 Plans to Restructure and Retain Farm
During December of 2020 Wandro attorneys Brian Lalor and Terry Gibson were able to assist two farm operators in gaining approval of restructuring plans under Chapter 12 of the Bankruptcy Code, enabling those clients to retain their farming operations and significantly restructure their indebtedness.
One case concerned a farmer from northeast Iowa who farms approximately 690 acres of row crop ground and has a smaller cattle operation. This client owed over $1.8M to his primarily lender, which the lender had declared in default and had threatened to commence foreclosure action against the client. Under the Chapter 12 plan approved by the Bankruptcy Court on December 9, 2020, the client was able to retain his farm ground, restructure the debt owed to the lender to avoid foreclosure, and has a mechanism to be able to transfer the operation to his grandson, as the client was hoping to do. The Wandro team also assisted this client with obtaining a input financing line of credit from a new lender during the Chapter 12 proceeding that the client will be using again for his 2021 crop and livestock operation.
The other case also involves a farming couple in the northeastern part of Iowa that operate a farming operation consisting of over 150 head of feeder cattle, a custom feeding operation, and farm approximately 200 acres of row crop ground. The clients also owned a separate company that operates a significant dairy operation that also filed for protection under Chapter 12 of the Bankruptcy Code. The Wandro team was asked to step in to represent the clients and their dairy operation in the spring of 2020, after their Chapter 12 cases had stalled and were facing actions by their primary secured creditor to dismiss their case and proceed with foreclosure actions. After getting involved the Wandro team was able to assist the clients in negotiating a plan that was confirmed on December 19, 2020 by the Bankruptcy Court that allowed the clients to restructure over $700,000 of debt to their primary lender, to pay off certain equipment financing, and to avoid repayment of over $650,000 of debt owed to their primary lender.
The Wandro commercial, ag and bankruptcy law team of attorneys Steven Wandro, Terry Gibson and Brian Lalor, and paralegal Dani Pigman, understand the issues facing farmers and the economic realities of farming. We are ready and willing to go the extra step to assist farmers throughout the state of Iowa that are struggling to meet the demands of their lenders and need assistance in restructuring their farming operations and debt loads. We strive to assist farmers to meet their goals, whether that be to retain the operation as is, or to restructure the operation to ensure that it can be operated in a successful manner going forward. We think it is important to reach a result that will provide a fair return to the farmer, not just the farmer’s creditors.
Don’t wrestle with the issues alone- give us a call for a free consultation and know that there is a path forward.