SIT­U­A­TION

• The oil & gas equip­ment man­u­fac­tur­er is a man­u­fac­tur­er of upstream and mid­stream process and pro­duc­tion equip­ment for the oil and gas industry
• 2019 rev­enues reached $137 MM with $20 MM in EBIT­DA but began to decline from the down­turn in ener­gy prices, with neg­a­tive EBIT­DA begin­ning dur­ing mid-year 2020 and per­sist­ed through the fall of 2021
• Chi­ron was engaged as Invest­ment Banker and Finan­cial Advi­sor in Octo­ber 2021 after the Company’s failed self re-financ­ing. At engage­ment, the Com­pa­ny was in default with their bank senior-secured lender and had over $10 MM of past-due accounts payable

OUT­COME

• Chi­ron suc­cess­ful­ly nego­ti­at­ed with the incum­bent senior-secured bank lender to obtain for­bear­ance, which allowed the Com­pa­ny access to its senior secured line of cred­it through­out restructuring
• Chi­ron restruc­tured the Company’s $31 MM lease with a third-par­ty land­lord, imme­di­ate­ly increas­ing liquidity
• Chi­ron nego­ti­at­ed with the Company’s Board, its Advi­sors, and its Pri­vate Equi­ty Spon­sor to inject $2 MM of equi­ty and lease for­bear­ance to facil­i­tate the refi­nanc­ing effort with new lenders
• Chi­ron suc­cess­ful­ly raised $1 MM+ of debt financ­ing by mon­e­tiz­ing the Company’s Employ­ee Reten­tion Tax Cred­it, fund­ed by a spe­cial­ty hedge fund, crit­i­cal to improv­ing liq­uid­i­ty dur­ing the restructuring
• Chi­ron mar­ket­ed the deal to over 380 lenders and suc­cess­ful­ly placed a quadru­ple tranche debt facil­i­ty total­ing over $19 MM
• The restruc­tur­ing and new financ­ings dra­mat­i­cal­ly increased the Company’s finan­cial sta­bil­i­ty. At clos­ing, liq­uid­i­ty increased 5.0x ver­sus the bank, com­mit­ted financ­ing increased by $16 MM, and past-due accounts payable were paid down by $3.5 MM

“The Chi­ron team was pro­fes­sion­al, proac­tive and effec­tive in advis­ing the com­pa­ny through its restruc­tur­ing and refi­nanc­ing process.” — John Can­non, Senior VP at Cadence Busi­ness Finance