RESTRUCTURING AND SPECIAL SITUATIONS

BORROWER REPRESENTATION

Evaluation of lender’s real perspective on the Borrower, which if often not shared directly with borrowers

Extension of additional capital to facility turnaround, recovery, and solvency

Negotiation of amendments to provide for extensions of maturity, amortization and rate

Exploration of forgiveness and/or conversion of debt positions into equity

Managing borrower and external resources to prepare for and navigate through financial restructuring

LENDER REPRESENTATION

Sale of whole loan or a portion of loan to a third party

Cost reduction initiatives for the company to enhance cash flow

Consideration of allowing borrower to implement certain low cost / high return capex initiatives to enhance cash flow

Asset sales by the borrower, with proceeds to pay down debt

Merger or sale of borrower

Explore refinancing alternatives for the borrower

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PORTFOLIO COMPANY REPRESENTATION

Provide support to management team, allowing management to focus on core operations

Identification of G&A reduction opportunities

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Re-negotiation of lease terms

Assessment of management team

Negotiation with trade creditors 

Management of relationship with financial sponsor and/or other stae

Assessment, negotiation and engagement of requisite external resources

RESTRUCTURING ADVISORY SOLUTIONS

Valuation of companies, entities, securities and assets, both as going concerns and in liquidation scenarios

Assistance to management in preparing financial forecasts and presentation

Development of restructuring proposals

Advocacy in the negotiation of terms and conditions with creditors with the goal of amending and restructuring existing debt and equity

Sales or purchases of distressed companies, divisions, and assets

Sales or purchases of performing and nonperforming loans

Structuring, negotiation, and confirmation of plans of reorganization

Structuring and analysis of exchange offers

Arranging for rescue financing, DIP facilities and exit financings

Support in hiring or managing external resources

KEY TENANTS OF EFFECTIVE ADVICE TO COMPANIES IN FINANCIAL DISTRESS

Understanding of enterprise valuation of a company or asset using objective and time-tested approaches

Trusted relationship and an open and realistic dialogue with company management and its key constituents with respect to the advantages and disadvantages of various strategic alternatives including assets sales, merger scenarios, sources of additional equity and debt financing alternatives

Access to a broad range of potential financial and strategic buyers, which allows management to select the most credible buyer with the least execution risk

Educated view on conditions in the capital markets and the availability and cost of equity and credit

Strong relationships with banks and institutional investors with expertise in special situation lending and investing

CHALLENGES IN SPECIAL SITUATIONS ADVISORY MANDATES

Restricted access to new capital

Total debt exceeding enterprise value

Conflicts between the various constituents that hold competing claims or interests

Covenant and/or payment defaults on debt instruments

Commencement or threat of bankruptcy proceedings