Goodman Networks Inc.

• 3/13/17 Recap: Frisco Texas-based minority-business-enterprise (MBE) and wireless network and satellite television systems servicer filed a prepackaged chapter 11 case to de-lever its balance sheet by $212.5mm. This is a story, in many respects, about a concentrated revenue base and too much debt. 83% of the company's revenue is attributable to AT&T and "substantial completion of AT&T's 4G network build-out has diminished the associated demand for Goodman's services." Consequently, the company wasn't generating enough revenue to sustain its capital structure. Now, holders of the secured debt will receive cash, $112.5mm of new debt, PIK preferred stock and common stock. To preserve the MBE status, current equity will get PIK preferred stock and 50.1% of the common stock. Query whether that level of retained equity is a lesson to those who invested in this MBE structure. 
• Jurisdiction: S.D. of Texas
• Capital Structure: $25mm RCF (MidCap Financial Trust), $325mm '18 12.125 % secured notes (Wells Fargo)
• Company Professionals: 
  • Legal: Kirkland & Ellis LLP (Patrick Nash, Joshua Sussberg, Joseph Graham, Laura Krucks, Alexander Cross) & (local) Haynes & Boone LLP (Stephen Pezanosky, Kelli Norfleet)
  • Financial Advisor: FTI Consulting (John Debus)
  • Investment Banker: June Creek Interests (Andy Jent)
  • Claims Agent: KCC (*click on company name for docket)
• Other Parties in Interest:
  • Ad Hoc Committee of Second Lien Bondholders (Alden Global, AllianceBernstein Global LP, J.P. Morgan Investment Management Inc., J.P Morgan Chase Bank N.A., Phoenix Investment Advisor LLC, Principal Global Investors LLC, Invesco Senior Secured Management Inc., Sound Point Capital Management LP)
    • Legal: Akin Gump (Michael Stamer, Charles Gibbs, Meredith Lahaie, Sara Brauner)
    • Financial: Greenhill & Co. Inc.
• Wells Fargo
  • Legal: Reed Smith LLP (Eric Schaffer, Lloyd Lim, Maura Nuno)
• AT&T Corp.
  • Legal: Sidley Austin LLP (Brian Lohan)

Updated 3/28/17