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Mem
bers
1. Madiha Niaz
F2017051012
2. Aliya Manzoor F2017051018
3. Qurat ul Ain Akhtar
F2017051016
The restructuring of Danfurn
LLC
Company Background
• Affordable prices
Danfurn- Marketing
strategy
• Durability
• Exclusive design
Danfurn LLC
• Milwaukee accountant
Bridget Urmanski
Situation/Problems
• Sales declined 22% in 2010.
• EBITDA fell to $6.5 million during 2010, down from $10.9 million in
2009, and $29.2 million in 2008.
Exhibit 3 (Consolidated Statement of Operations) and
Exhibit 4 (Consolidated Balance Sheet)
.....On Excel Sheet
Horizontal Analysis of Net Sales
Net Sales
0.6
0.55
0.5
0.4
0.3
0.2
0.1 0.11
0
2007 2008 2009 2010
-0.1
-0.15
-0.2 -0.22
-0.3
Horizontal analysis of EBITDA
0.4
0.29
0.2
0.17
0
2007 2008 2009 2010
-0.2
-0.4 -0.39
-0.6
-0.63
-0.8
Results of downturns
• Danfurn did not meet the covenant of $8.5 million EBITDA in 2010.
• Secured Creditors at
Operating Subsidiaries
• Unsecured Creditors at
Parent
• Equity Holders
Refinance
Restructuring Debt
options
Sale
process Restructuring Bankruptcy
of Danfurn
Out of
court
restructure
Refinance
Debt:
• Availability of Financing
• Terms
Refinance
Debt:
• Restructuring would reorganize its debt obligations by either refinancing or
restructuring its existing debt
• Reduction of Interest rate
• Improve prices
Retain Investment
banker
• Highly helpful
• 90866-90200=666000
Stalking Horse
Credit Bidding
Restructuring
Plan:
• According to Bankruptcy Law chapter 11:
• Funding Issue
• Cash Collateral
• Potential for litigation with bank
• Dismissal for bad faith? Relief from Automatic stay
• Exit Financing
• New equity Investment
• Director Officer Liability issue
Funding issues
• Consensual foreclosure
• Debt for equity swap
• Sale by bank to third party
• New equity investment
• Director liability issues
• Wind down costs, payment of unsecured claims
• Priority tax and wages claims
Conclusio Refinance
Debt
n
Sale
process Restructuring Bankruptcy
of Danfurn
Out of
court
restructure
Open for questions