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Case Studies

Leading Alternative Investment Firm

Business Services

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SIT­U­A­TION

  • Black Dia­mond Cap­i­tal Man­age­ment is a lead­ing alter­na­tive invest­ment firm with over $10 bil­lion in assets across four core plat­forms includ­ing Black Dia­mond Com­mer­cial Finance, LLC (the Com­pa­ny”)
  • IAP World­wide Ser­vices, Inc. (“IAP”) is the mid­dle mar­ket leader in pro­vid­ing expe­di­tionary and con­tin­gency oper­a­tions sup­port to the Depart­ment of Defense and Nation­al Secu­ri­ty Com­mu­ni­ty; 2022 rev­enues were $470.3MM
    • The Com­pa­ny was the major­i­ty senior secured lender to IAP and was also col­lat­er­al agent for the lend­ing syndicate
    • IAP by ear­ly 2023 found itself in con­sid­er­able finan­cial trou­ble, plus the syn­di­cate debt was matur­ing July 23, 2023. On Sep­tem­ber 18, 2023 a $114MM unse­cured judge­ment was domes­ti­cat­ed, threat­en­ing IAP’s sol­ven­cy, lead­ing to IAP con­duct­ing a sale process. Note: IAP was not able to seek bank­rupt­cy pro­tec­tion with­out los­ing its most valu­able gov­ern­ment con­tracts to competitors
    • Dur­ing the sale process IAP con­tin­ued to lose employ­ees and became increas­ing­ly finan­cial­ly unsta­ble, imper­il­ing it as a going concern
    • On Novem­ber 28, 2023 the Com­pa­ny, as col­lat­er­al agent, held an Arti­cle 9 pub­lic sale of IAP’s col­lat­er­al which com­prised sub­stan­tial­ly the entire business
  • The judge­ment cred­i­tor sought injunc­tive relief to the Arti­cle 9 pub­lic sale results, claim­ing that the process was con­duct­ed improperly
  • On Decem­ber 14, 2023 Chi­ron was hired by Com­pa­ny coun­sel for expert tes­ti­mo­ny on this Arti­cle 9 pub­lic sale

OUT­COME

  • Chi­ron pre­pared a Dec­la­ra­tion which was sub­mit­ted to the Unit­ed States Dis­trict Court, South­ern Dis­trict of New York, on Decem­ber 172023
  • Sub­se­quent to this date, the judge­ment creditor’s request for injunc­tive relief to the Novem­ber 28, 2023 Arti­cle 9 sale was denied
  • The Company’s affil­i­ates acquired IAP on Jan­u­ary 222024

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