Introduction / revisit the four-step analytical approach and evaluate the strengths and weaknesses of debt structures in protecting lenders / investors when a company reaches crisis point.

  • Purpose: identify the borrower and where the assets and cash flow are
  • Risks: macro, sector, business and financial, management and owners
  • Debt profile: amount, currency, tenor, drawdown and repayment
  • Ranking: legal, structural, and effective
  • Covenants: predictive qualities of standard leverage loan covenants
  • Credit pricing and recovery rates.

CRISIS MANAGEMENT

  • Managing exposures to a company in distress: the short term crisis management and the medium term business revisions required to manage the situation.

Triggers to distress

  • Covenant breach
  • Liquidity crunch / Refinancing difficulty
  • Insolvent trading:
  • Defining insolvency 
  • Jurisdictional considerations
  • Exercise: Covenant breach and actions taken

Managing crisis

  • Management response to covenant breaches
  • Exercise: Exchange offers
  • Options for lenders
  • Potential parties to a restructuring
  • Appointment of external advisors
  • Cash management
  • Majority decision issues
  • Establish and certify the company's going concern status

Legal framework

  • Insolvency regimes
  • Responsibility of directors}
  • Recovery rates
  • US models: Chapter 11 (reorganization) and Chapter 7 (liquidation)
  • Exercise: Impact of Chapter 11 on Global companies
  • Overview of EU Insolvency Regulation
  • Establishing center of main interest (COMI) and secondary proceedings
  • Summary of insolvency procedures in UK, Germany, France, Spain
  • Exercise: Jurisdiction selection for insolvency proceedings.]

REMEDIAL BUSINESS PLAN

Evaluate the key business and operational decisions required by the company in order to place the business on a more solid foundation.

  • Identify underlying cause for the need to restructure
  • Over indebtedness
  • Operational issues
  • Determine a sustainable EBITDA
  • Assess viable level of debt
  • Overview of valuation methods: multiples, discounted cash flow or asset valuation
  • Obstacles to restructuring.

DEBT RESTRUCTURING ALTERNATIVES

  • Examine the available options, compare likely recovery against other alternatives and the current   market price of the company's debt, where applicable.

Exit Options for the Lender

  • Sale of exposure, hedge (CDS, credit insurance)
  • Negotiate: waive covenants, debt / equity swap, debt / debt swap, amend and extend
  • Accelerate: enforce, bankruptcy filing

Distressed Valuations

  • Cost of financial distress
  • Cyclicality on firm values
  • Quantify potential recovery for creditors
  • Relative claims and negotiating positions creditors
  • Stakeholders with special negotiating positions
  • Claims are not pro-rata
  • Intercreditor agreements and terms
  • Impact / influence of distressed / vulture funds on restructuring alternatives
  • Cram down rights: forcing confirmation of a plan over the objections of dissenting

WHO SHOULD ATTEND

  • Credit risk managers, bond and mezzanine and equity investors, lending bankers, and other finance professionals working in credit risk management and problem loan areas, including restructuring, work-outs and special care units.

COURSE OBJECTIVES

  • The purpose of this workshop is to identify the key analytic, structuring and restructuring lessons to be learned from deteriorating / failed credits. This is a highly interactive workshop where case studies and exercises are used to reinforce key learning points of the workshop

LEARNING INTERVENTIONS

  • At Jadarat, we believe that human understands more by engagement, by action. You get the best understanding of anything by trying it, thinking about it, talking about it, not by listening to a trainer and watching a presentation. In this work shop you will learn by educational games, community of practices, job assignments, action learning, storytelling, as well as classrooms, and storytelling.

PRE-COURSE ASSIGNMENT

  • Before the course, Jadarat assessment center will provide you with international, highly credible assessments that will measure your interpersonal skills, and give you a fruitful report that will help you improve your interpersonal skills, understand every employee needs, passion, communication style, and improve your ability to deal with every employee according to his character. You will also warm up for the course by doing some activities, and answering some questions in order to get ready for the training.

END-OF-COURSE ASSIGNMENT             

  • After finishing the course, you will test your knowledge by answering an assignment. This will let you know which areas you have a good understanding of, and which ones you need to understand better.

POST-COURSE FOLLOW-Up

  • You can replay the same course within 6 month and we are committed to full money back guarantee if the delegate's satisfaction is less than 85% in this course.

Jadarat is established to develop the leadership and innovation capacity of individuals and corporates in the Middle East. Our prolonged relations with our loyal customers are achieved through our commitment to quality in content, joyfulness in delivery, and excellence in operation. We guarantee unforgettable learning experience, holistic approach to leadership development, and innovative learning interventions that assure lasting change for our clients.

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