Abraxas Group’s Restructuring Recap is a synopsis of recent articles touching on issues of value enhancement, restructuring and turnaround as they apply to middle market companies.

1. 1
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Lenders Can Only Watch as
Covenant-Lite Debt Strips Influence:
Restructuring Recap
October 25, 2016

2. “...now I'm a spent firework; but at least I've been a
firework.”
‒ David Mitchell, Cloud Atlas
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3. • David Johnson is a career change agent who has served as interim
manager or financial advisor on over $5 Billion of distressed middle
market transactions.
• In his nearly 20 years as a change agent, David has served as an advisor,
board member, interim manager, investor and operator at
organizations ranging in size from pre-revenue startups to the Fortune
500.
• David has several publications to his credit and is a regular speaker on
the topics of change management, performance improvement,
turnaround and restructuring. He received his MBA from the
University of Chicago and completed his undergraduate studies at
Fairleigh Dickinson University.
David Johnson
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Email: david@abraxasgp.com
Ph: 312-505-7238
Twitter: @TurnaroundDavid

4. • The majority of high yield issues in 2016 have
been “covenant lite”.
• The challenge of these structures is that, when
companies begin to show signs of strain,
creditors are powerless to act.
Lenders Can Only Watch as Covenant-Lite Debt
Strips Influence
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Links (here, here)
Twitter: @ejorr_6 |
@rob_cyran

5. Inside the Catastrophe at Mode Media
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The story of the reckless pursuit of growth over profitability, a shifting competitive landscape, and investors
losing faith, is very familiar; perhaps highlighting the fact that the fundamentals of business remain the
same, no matter the numbers involved.
Link
Twitter: @nmcalone

6. Department Stores are struggling to rationalize their footprints as customers continue their embrace of
ecommerce.
More Than 700 Department Stores Have Closed
Since 2013
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Link
Twitter: @philwahba

7. TheValuation History That Led to One Kings
Lane’s Fire Sale
Ecommerce startup One Kings Lane raised over $200 million between its founding, in 2009, and its last
round, in 2014. That final round valued the company at over $800 million. Less than three years later, the
would-be disrupter was sold to Bed Bath & Beyond for $11.8 million, highlighting the brutal economics of
startups.
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Links (here, here)
Twitter: @mikeytom |
@danprimack

8. Houston’s Plan to Cut Pension Costs in Half
Overnight
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Houston Pension Approach
Links (here, here)
Twitter: @LizFarmerTweets |
@BillFultonVta
Experts have been impressed by the recent proposal of Houston Mayor Sylvester Turner to reduce his city’s
$7.7 billion unfunded liability by nearly 50 percent.
Total Unfunded Liability 7.7$ B
Less: Concessions
Police -1.1
Fire -0.8
Municipal Employees -0.7
Total Concessions -2.6
Less: Pension Obligation Bond -1.0
Total Reductions -3.6
Remaining Unfunded Liability 4.1$ B
Source: Kinder Institute