Adams and Reese Partner and Construction Practice Team Co-Leader Trent Cotney was interviewed by the Construction Dive in the Feb. 1 article, “Florida Contractor Files for Chapter 11.”
Tampa, Florida-based general contractor Matcon Construction Services filed Chapter 11 bankruptcy protection in U.S. District Court citing COVID-19 post-pandemic challenges, material and labor shortages, supply chain delays, inflation, fixed-price, and fixed-schedule contracts, among other issues.
More construction-related bankruptcy filings could be on the horizon this year due to issues with the supply chain, inflation, labor and financing, said Cotney to the Construction Dive. “There is a trend of contractors and trades filing for bankruptcy protection and I anticipate additional filings. I believe these bankruptcies arise primarily out of issues with material volatility and the inability to adjust fixed-price contracts.”
The purpose of Chapter 11 of the U.S. Bankruptcy Code is to rehabilitate a business as a going concern or reorganize finances through a court-approved reorganization plan. This reorganization plan must be accepted by a majority of the debtor’s creditors.
Read the complete article here.