Miles & Stockbridge’s lawyers regularly assist manufacturing and distribution companies in navigating and preparing for the many legal and practical issues that can arise when suppliers and vendors experience financial distress. The insolvency, dissolution or bankruptcy of a supplier or vendor can wreak havoc on a company’s operations and directly affect its bottom line.
Through our extensive Commercial Finance and Creditors’ Rights practices, and our deep firmwide experience in the manufacturing and distribution industries, we help our clients proactively develop strategies and implement procedures to reduce the impact of troubled suppliers and vendors. When we are informed by a client that its supplier or vendor is financially distressed, we quickly assemble a team to assess our client’s need for continuity of supply, to evaluate the options and potential risks and to create and implement a strategy that enables our client to maintain its own production schedule and business operations and avoid breaching contracts with its own customers.
We have substantial experience dealing with the full range of issues attendant to a troubled supplier or vendor, including:
Negotiation and drafting of accommodation agreements, access agreements, tooling agreements and participation agreements
Removal of tooling and dies
Enforcement of UCC Article 2 rights and remedies
Enforcement of setoff rights, and Supply chain management.