Allied Defense Group
The Allied Defense Group, Inc. (“ADG”) was a publicly traded, multinational defense business focused on the manufacture and sale of ammunition and ammunition-related products for use by the U.S. and foreign governments. Due to delays in new orders from ammunition and weapons contracts, ADG began to experience a significant disruption during the 2Q of 2007 with sales declining more than 50% year over year. The deterioration in financial performance resulted in an event of default under the company's existing convertible note agreement. Charlie represented ADG in the restructuring of approximately $30 million in senior subordinated convertible notes resulting from a failed convertible PIPE (private investments in public equities) transaction and supervised the M&A sale processes for its subsidiaries.
KEY ACHIEVEMENTS
Charlie successfully restructured the toxic PIPE allowing the company to sell and/or restructure its American and European subsidiaries. They also advised on the sale of several of ADG's subsidiaries, including:
The VSK Group, a global leader in security surveillance systems
Global Microwave Systems, a California based manufacturer of satellite antennae and transmissions systems
Titan, a U.S. manufacturer of pyrotechnic devices for the U.S. military
Charlie helped ADG explore strategic alternatives in relation to its American and European subsidiaries.
Consequently, ADG successfully:
Recapitalized its senior subordinated convertible notes ("Original Notes") in the principle amount of $30 million and related warrants
Resolved all outstanding disputes with its bondholder group represented by four financial institutions
Exchanged the Original Notes for new senior secured convertible notes and common stock of the company
Received $15 million in new funding from existing bondholders
Over the succeeding 2 years, ADG sold several of its subsidiaries, using the proceeds both to reduce and ultimately pay off in full the amounts due the bondholders, and to support the recovery of the company’s remaining munitions business. Ultimately, the holders of the Original Notes were paid in full, and equity remained unimpaired.