Quick-Service Restaurant Franchisee

Situation

  • Advised the senior lender syndicate of a major quick-service restaurant franchisee with $250 million of senior debt
  • Operating costs had increased dramatically, primarily driven by rent expense
  • The Franchisor had introduced a new branding scheme, which also increased capital expenditure projections
  • The Company was unable to make its scheduled interest and principal payments to the lender group

Execution and Results

  • Provided an assessment of the viability of the company’s business and turnaround plans
  • Performed in-depth analyses of corporate, regional and local-level operations;
  • Provided an assessment of the lender group's collateral position
  • Worked with the Company to develop a cash flow management tool tracking receipts and expenditures, resulting in a stabilization of cash flow and an increase in cash on hand
  • Negotiated a successful financial and operational pre-packaged bankruptcy solution to maximize the lender group's recovery

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