Author: EMAGroup

The company was incurring significant legal costs in a dispute with the Teamsters, had lost its two anchor tenants at its warehouse, and was in dispute with the state of California over the classification of its drivers as independent owner-operators.

East Coast refinery of major oil company had been underperforming for many years and was acquired by an independent producer. Managed the post-acquisition integration, and 25% cost reduction over refinery operations, plus the build-out of back-office support for East Coast-based commodity trading operation.

U.S. Government agency funded build-out of rural telecommunication operator for five island operations. Delays in build-out result in less than expected revenues and inability to service governmental loans of $120 million and bond debt of $180 million. Multiple budgets and projections were significantly inaccurate, and debtholders had lost confidence in management team provide accurate cash flow forecasts and timely/accurate period-to-period financial statements.

After experiencing continuing losses without an exit, secured lenders foreclosed on company. The lenders preferred a quiet restructuring to discontinue part of the business while seeking a path to relaunch the remaining business.

Failed product launch resulted in severe operating losses and liquidity limitations which prevented ability to relaunch reformulated product. Leverage/hedge fund lender forced foreclosure because of loss in confidence over management actions. Management walked out when lender refused to finance product launch without adequate financial documentation or explanatory support.

Family office was unable to improve four-wall contribution post-acquisition with planned shift to higher-end services and streamlining of support costs. 

Deep covenant default resulting from substantial operating loss, excessive leverage, and non-compliance of loan and financial reporting requirements. Management had prepared a plan to remediate the business operations but was unable to reconcile planned improvements to obtain profitability. Company asked to exit bank because of excessive debt and significant operating losses.

Covenant default resulting from continuing operating losses and non-compliance of loan and financial reporting requirements. Compounded by senior lender’s growing impatience with management’s inability to execute on an operating plan. As a result, lender asked Company to exit the bank through a refinancing or other acceptable plan.

Deep covenant default resulting from ($5 million) operating loss and non-compliance of loan and financial reporting requirements, compounded by management’s inability to explain causes of operating losses or how to fix them. As a result, lender asked them to exit the bank through a refinancing or be sold through a court proceeding.

Transition of family-owned business to second generation was followed by a downturn in sales and profitability. Family members who inherited and were then responsible for managing the business were unfamiliar with retail operations. Because of operating losses and issues related to non-compliance on bank reporting covenants, incumbent lender asked that company find a replacement lender.