Fiduciary
Services

Pass Go - Collect $3.0 million: Asset Management for Hoteliers

Two 300-room Five Star hotels were suffering from annual losses on revenues of $25 million. Losses were due to low occupancy, low average room rates and high indirect costs. A bank group had taken ownership in a foreclosure proceeding and hired a hotel management company to run day-to day operations, but the banks also wanted another set of eyes reviewing operations. The Agent Bank selected a PMCG Principal to provide local representation and operational oversight. PMCG immediately identified options to reduce cost and increase cash flow while also uncovering several instances where excessive management fees and payments were improperly charged to operations. Over $3.0 million in improper fees and payments were recovered almost immediately. Revenue and profitability was improved over a period of just a few years and both hotels were sold for a gain of over $15 million, after liquidation of bank debt.
 

Working in the Vineyards: Receivership

The senior lender required that a PMCG Principal become the Receiver as a condition for providing an additional $500,000 in funding to finish and harvest the growing crop on a 1,000-acre vineyard. Much of the crop was committed under long-term purchase contracts to wineries for their premium programs but because of prior cultural neglect, the quality of the grapes was in question. The wineries were threatening to cancel grape purchase contracts worth $3.5 million unless immediate action was taken. PMCG's Principal assumed management of the property, corrected the problems, finished the crop and preserved the long-term contracts with the wineries allowing the property to be sold with the proceeds fully repaying all creditors.

When the Boat Won't Float: Assignment for the Benefit of Creditors - Liquidation

A ship supply business with four locations on the West Coast had PMCG appointed as the Assignee for the Benefit of Creditors. Although the total inventory remaining on the company's financial statements was valued at $1.0 million, claims from 1,200 creditors totaled $1.8 million. An initial PMCG audit determined that the actual book value of the inventory was less than $800,000 and liquidation value would be substantially less. Nevertheless, PMCG was able to collect accounts receivable in excess of $100,000, auction off the remaining inventory, pay expenses and make three liquidating distributions to creditors.

 

Taking the High Road: Collateral Agent & Director - Rail Transportation

A PMCG Principal was chosen to represent a class of creditors holding $18.0 million in secured claims and equity under Plan of Reorganization. The re-organized company manufactured rail cars, performed contract maintenance and had a large fleet leasing operation. The Collateral Agent responsibilities included taking custody of pledged collateral, representing constituent interests on the Board of Directors, monitoring company operations, cash flow and covenant compliance. PMCG also acted as disbursing agent for payments to the creditors. 		 


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