People > Office: Birmingham

Out-of-Court Workouts

Beginning in 2017, representing critical vehicle component manufacturer in successful workout with secured lender and key OEM customers, in collaboration with a national turnaround advisory firm. The company went from negative EBITDA margin to greater than ten percent, eliminated $5 million of past due trade debt, paid off its senior lender revolver and is in compliance with all bank covenants. All OEM customers stayed with the company, after providing approximately $4 million of pricing and subordinated loans to the company, which were repaid in full.

Represented dozens of other automotive suppliers, customers and secured lenders in multi-party workouts to ensure continued production of critical component parts while preserving secured lender collateral, often embodied in complex, heavily-negotiated Accommodation and Access Agreements.

Routinely represent debtors, creditors and key stakeholders in out-of-court workout situations nationwide, in all industries.

Represented numerous residential and commercial real estate builders in the wake of the housing market bubble in the mid-2000s in workouts with secured lenders, including negotiating forbearance agreements, surrender agreements and distressed sales, successfully mitigating impact on guarantors and preserving value.

Distressed Transactions

Represented a heavy truck supplier subsidiary in a successful distressed divestiture in 2022. The supplier was nearly out of liquidity and out of covenant with its lender, having drawn down almost its entire line of credit to fund losses due to unprofitable customer contracts. The subsidiary and parent were co-obligors of the debt, burdening the parent with potentially unsustainable debt. Together with a transactional team at Varnum, Brendan worked with a major restructuring financial advisory firm and investment bankers to negotiate an Accommodation Agreement with the supplier’s major customers and its lender. The customers unsuccessfully sought to burden the parent with the continued losses and force the sale of the subsidiary at a depressed price. The negotiated agreement instead required the customers to fund the company’s significant losses during an extended marketing and sale period that resulted in the sale of the subsidiary to a strategic competitor at an agreed upon strike price which the customers agreed to backstop. The end result was that the customers funded over $20 Million of accommodations to the supplier, and the sale price paid down substantially all of the debt incurred by the subsidiary, leaving the parent with a fair, sustainable level of debt.   

Represented Fabco Holdings, Inc. in sale of product portfolio and related technologies to Meritor, recognized as the Restructuring Deal of the Year in the $25-50 million category at the 2018 Annual Turnaround Awards, providing insolvency-related counsel with respect to the negotiation of the purchase agreement and other transaction documents, employee benefit and union matters and financing-related items.

Represented private equity-owned lightweight paper printer and specialty finisher Dickinson Press and Kingsport Book in an expedited, highly distressed sale to book printing industry consolidator CJK Group in 2018. Working collaboratively with a turnaround advisor they brought into the situation, Varnum assembled a multidisciplinary team and negotiated and closed the complex APA in less than two weeks, preserving the majority of jobs at both companies.

Represented private equity-owned medical device manufacturer in distressed sale to another private equity firm, preserving jobs and paying secured creditors and unsecured creditors through assumption of liability and sale proceeds (2019).

Represented Midwest oil and gas E&P company leading to successful settlement with equity interest holders and judgment creditor (2016).

Chapter 11 Debtor Representations

In re Telesource Services, LLC (Bankr. E.D. Mi. 2015) (filed Chapter 11 case for telephone company with $5 million of secured and unsecured debt and an asset value of $4 million, successfully obtained priming DIP loan to make payroll after heavily contested evidentiary hearing; successfully represented the debtor in a Section 363 sale, preserving the going concern value and jobs, and confirming a Plan of Liquidation for the wind down and dissolution of the company)

In re Gerald Johnson, Jr. (Bankr. E.D. Mi. 2013) (funeral home)

In re TMT, Inc., et al. (Bankr. N.D. Oh. 2013) (trucking)

In re Shanta Corporation, et al. (Bankr. E.D. Mi. 2012, 2015) (represented family-owned struggling group of nursing homes with $15 million of secured and unsecured debt and an asset value of $16 million in Chapter 11 confirmed Plan of Reorganization and subsequent Section 363-sale Chapter 22s)

In re S.D. Benner, L.L.C. (Bankr. W.D. Mi. 2011) (substituted in as debtor counsel on eve of motion to appoint Chapter 11 trustee; successfully defended against motion and successfully confirmed Plan of Reorganization for property companies with $21 million of secured debt and an asset value of $36 million)

In re Bing Construction (Bankr. E.D. Mi. 2011) (construction)

In re Fort Wayne Foundry Corporation (Bankr. N.D. Ind. 2009) (automotive)

In re Griswold Building, LLC, et al. (Bankr. E.D. Mich. 2009) (represented debtor/owner of historic Dime Building (n/k/a The Chrysler House) in downtown Detroit with $50 million of secured debt and an asset value of $71 million)

In re Greektown Holdings, LLC, et al. (Bankr. E.D. Mich. 2008) (hotel and gaming) (after casino and hotel with $475 million of secured and unsecured debt and an asset value of $400 million was forced to file Chapter 11 to complete botched construction of permanent casino and hotel space, successfully represented debtors in heavily contested cash collateral, exclusivity and claim objection matters and Plan of Reorganization)

In re Williams Panel Brick, Inc. (Bankr. E.D. Mi. 2008) (building supply)

In re Pine River Plastics, Inc. (Bankr. E.D. Mich. 2007) (automotive) (represented global plastic injection molder with multiple manufacturing facilities, $36 million of secured and unsecured debt and an asset value of $24 million, in pre-petition workout and Chapter 11 filing and successful Section 363 sale and liquidating plan confirmation)

In re Oxford Automotive, Inc. (Bankr. E.D. Mi. 2004) (automotive)

Chapter 11 Secured Creditor Representations

In re Goodrich Quality Theater, Inc. (Bankr. W.D. Mi. 2020) (regional movie theater chain) (represented senior agent and lenders of $30 Million in pre-petition workout and subsequent Chapter 11 sales of substantially all of the borrower’s assets, including representing agent and lead lender in debtor-in-possession financing facility)

In re Collins & Aikman Corporation (Bankr. E.D. Mi. 2005) (automotive) (represented pre-petition agent of $750 million senior secured pre-petition debt and $300 million post-petition DIP loan)

In re Intermet Corporation and Ganton Technologies, Inc. (Bankr. E.D. Mi. 2004) (automotive) (represented pre-petition agent of $300 million senior secured pre-petition debt and $60 million post-petition DIP loan)

In re Thomas and Monique Hicks (Bankr. W.D. Mi. 2015) (agriculture) ($6 million senior secured debt)

In re Wheaton Medical, S.C. (Bankr. N.D. Il. 2019) (medical) (successfully challenged use of cash collateral, obtained adequate protection payments)

In re VAE, LLC (Bankr. E.D. Mi. 2018) (mobile home)

In re Hardrock HDD, Inc., et al. (Bankr. E.D. Mi. 2017) (construction)

Chapter 7 Secured Creditor Representations

In re Electric Last Mile, Inc., et. al. (Bankr. Del. 2022) (electric vehicle OEM) (represented senior secured creditor / land contract vendor with $30 Million-plus claim, obtaining full payment for client plus post-petition default interest and attorneys’ fees.

In re Clio Holding Company, et. al. (Bankr. Del. 2020) (national building supplier) (represented senior agent and lenders of $26 Million in pre-petition workout and subsequent Chapter 7 sales and liquidation, negotiating a cash collateral agreement with the Chapter 7 Trustee, overseeing the sale of the borrower’s operating assets in a series of going-concern sales and the collection of outstanding accounts receivable)

Receiverships and Other State and Federal Litigation Matters

Ernest Acquisition Real Estate, LLC and TCH Investing LLC (2019) (represented buyer at state court receivership auction and subsequent sale of real estate and equipment)

VAE, LLC and Westshore, LLC (2018) (representing junior secured creditor in state court receivership of two mobile home parks)

Michigan Conference of Teamsters Welfare Fund, Trustees of v. McKinley Trucking Company, Inc. (E.D. Mi. 2017) (represented dissolved company defendant in claim of union related health care fund)

MW Capital Funding, Inc. v. Magnum Health And Rehab Of Monroe LLC, et al. (E.D. Mi. 2016) (nursing homes) (represented debtor chain of nursing homes in federal receivership and pre-receivership negotiations)

Computer Business World v. Thomas Eugene, et al. (2008) (represented defendants in state court post-judgment contested matters, successfully halting overreaching collection efforts of judgment creditor, holding non-dischargeable judgment, through successful motions to quash; the case became known as the “Sippy Cup Case” by presiding Judge Potts after oral argument when facts came out that during sheriff’s deputies’ collection raid on defendants’ private residences, the deputies removed all contents of the houses including their children’s sippy cups)

Regularly represent automotive toolmakers in pre-litigation contract disputes and litigation matters related to tooling lien rights

Wind Downs and Liquidations

Represented agent and lender of $26 million of senior secured indebtedness in liquidation of national builder supply company borrower (2020)

Represented Tier 2 automotive supplier unable to negotiate pricing increases with key customers and forced by secured lender to close its doors and liquidate, paying off secured lender in full (2019)

Represented Midwest family-owned scrap company in wind down and sale of remaining assets (2018)

Due to loss of key customers, represented family-owned trucking company in the wind down and liquidation of its rolling stock and related assets, paying employee-related and other priority claims (2017)

Chapter 11 General Creditor and Landlord Representations

In re Inspired Concept, LLC (Bankr. E.D. Mi. 2020) (restaurants) (represent landlord of five open locations and a number of locations that were closed pre-petition in a 12-location restaurant reorganization case in Mid-Michigan)

In re University Physician Group Creditor Representation (Bankr. E.D. Mi. 2018) (medical) (represented Wayne State University as plan sponsor of successful Plan of Reorganization providing $16 million in exit financing and defeating claims asserted by competing physician groups after extensive, expedited discovery, briefing and oral argument)

In re Great Lakes Comnet, Inc. (Bankr. W.D. Mi. 2016) (telecommunications) (represented sub-contractor asserting contested mechanics’ lien claim, litigated novel issue regarding improvement to property leading to favorable settlement before trial)

In re Chassix Holdings, Inc., et al. (Bankr. S.D.N.Y. 2015) (automotive) (represented customer/member of unsecured creditors committee)

In re Contech U.S., LLC (Bankr. E.D. Mi. 2009) (automotive)

In re Blue Water Automotive Systems, Inc. (Bankr. E.D. Mi. 2008) (automotive)

In re Continental Promotion Group, et al. (Bankr. M.D. Fl. 2008) (financial services) (represented customer as constructive trust claimant of bankrupt rebate processor)

In re Kimball Hill, Inc. (Bankr. N.D. Il. 2008) (construction) (represented key building material supplier in large home builder Chapter 11)

In re Plastech Engineered Products, Inc. (Bankr. E.D. Mi. 2008) (automotive)

In re Engineered Plastic Products, Inc. (Bankr. E.D. Mi. 2006) (automotive)

In re Uni Boring Co., Inc. (Bankr. E.D. Mi. 2005) (automotive)

Chapter 11 Unsecured Creditor Committee Representations

In re Body Contour Ventures, LLC (Bankr. E.D. Mich. 2019) (aesthetic medicine)

In re Plasco Tooling & Engineering Corporation (Bankr. E.D. Mich. 2017) (aerospace)

In re General Products Corporation (Bankr. E.D. Mich. 2016) (automotive)

In re DRS Household Services (Bankr. E.D. Mich. 2015) (home health care company)

In re Latex Foam International, LLC (Bankr. D. Ct. 2014) (mattress manufacturer and retailer)

In re SSI Technology, Inc. (Bankr. E.D. Mich. 2014) (defense industry)

In re W.T. Harvey Lumber (Bankr. M.D. Ga. 2012) (local hardware store chain)

In re Thriftco, Inc., et al. (Bankr. W.D. Ky. 2010) (local hardware store chain)

In re Eurway, Inc. (Bankr. N.D. Tx 2009) (regional furniture store chain)

In re TI Acquisition, LLC (Bankr. N.D. Ga. 2008) (carpet manufacturer)

In re Premier Products, Inc. (Bankr. W. D. Mich. 2007) (automotive supplier)

Liquidating Trusts

Unsecured Creditor Trust of In re Body Contour Ventures, LLC (Bankr. E.D. Mi. 2019) (representing liquidating trustee, investigating potential Ponzi scheme and other fraud claims against insiders; reviewing claims for bases of objection)

Unsecured Creditor Trust of In re General Products Corporation (Bankr. E.D. Mi. 2017) (representing liquidating trustee, investigated and prosecuted Chapter 5 causes of actions; reviewed and objected to claims, representing trustee in contested claims objections)

In re PT Liquidation Corp. (Bankr. W.D. Mi. 2016) (represented involuntary petitioning creditor and subsequently appointed Chapter 7 trustee as special counsel, successfully prosecuted preference action portfolio and settled claims pre-litigation with directors of debtor on breach of fiduciary duty and deepening insolvency claims)

Adversary Proceeding Representations

In re A. P. Liquidating Company (Unsecured Creditor Committee v. Qwest Communications Corporation) (2002) (telecommunications) (successfully represented defendant in $300 million destruction of business damages claims brought by unsecured creditors committee, winning case on directed verdict motion)

Represented plaintiffs and defendants in over 150 preference and fraudulent transfer actions across the country

Chapter 11 Equity Interest Holder Representations

In re Frank W. Kerr Company (Bankr. E.D. Mi. 2016) (pharmaceutical industry) (represented shareholders of company in involuntary Chapter 11 in pre-litigation negotiations resulting in favorable out-of-court settlement)

In re Pro Golf of America, Inc. (Bankr. E.D. Mi. 2006) (retail franchisor) (represented owner of golf equipment franchisor in Chapter 11)

Chapter 11 Asset Sale Buyer Representations

In re Gissing North America LLC, et. al. (Bankr. E.D. Mi. 2022) (Tier 1 automotive supplier) (represented Angstrom Automotive Group in the turn-key acquisition of two manufacturing in Auburn, Maine, and Sidney, Ohio in highly-expedited two week process, negotiating the asset purchase agreement and concurrently arranging for the purchase of real estate in Maine while negotiating agreements and resolving objections with many of Gissing’s suppliers and customers with the major OEM customers)

K & D Industrial Services Holding Co., Inc. (Bankr. E. D. Mi. 2019) (represented buyer in acquisition of industrial service company)

In re Thomson-Shore, Inc. (Bankr. E. D. Mi. 2019) (represented buyer in acquisition of distressed printing company)

In re ECOtality, Inc. (Bankr. D. Az 2013) (electric vehicle charger manufacturer) (Department of Energy grant recipient ran out of cash, forcing OEM to inject emergency loan to fund Chapter 11 filing and highly expedited bidding and auction process to ensure continued maintenance of in-place charging units; represented strategic customer in successful bid and purchase of EV charging stations at drastic discount)

Involuntary Petitioner Group Representations

In re PT Liquidation Corp. (Bankr. W.D. Mi. 2016) (automotive)

PACA-Related Engagements

In re Cherry Growers, Inc. (Bankr. W.D. Mi. 2017) (represented cherry product marketing and sale co-op in bankruptcy case of cherry grower co-op, defending secured claims against asserted PACA claims)

In re Badalament, Inc. (Bankr. E.D. Mi. 2005) (represented major international grower / senior PACA creditor of debtor fruit wholesaler)

General Representations

Outside bankruptcy and workout counsel for large international building supply holding company and its subsidiaries.

Bankruptcy and workout counsel for numerous automotive suppliers, lenders, financing companies and other companies.

Chapter 9 Representations

In re City of Detroit (Bankr. E.D. Mi. 2013) (represented one of largest bondholder insurer creditors as local counsel in historic large city Chapter 9 case; participated in multiple contested matters and evidentiary hearings)

Chapter 15 / Foreign Proceeding Representations

In re Stelco, Inc. (2004) (steel) (represented Canadian steel supplier in its pre-Chapter 15 Section 304 foreign proceeding to enforce the automatic stay to protect U.S. assets)