Patriot National Inc.

• 1/30/18 Recap: Once publicly-traded ($PN, delisted) Florida-based tech and outsourcing solutions services provider to the insurance services space (primarily in the workers' compensation sector) has finally filed the prearranged bankruptcy it announced back at the end of November. This company's downfall is a lesson in making sure that a company's customer base is well-diversified. Here, one insurer, Guarantee Insurance Company, accounted for 55% of the policies serviced by the debtors and a similar percentage of the debtors' gross revenues. In November 2017, the Florida Office of Insurance Regulation notified the Florida Department of Financial Services of its determination that GIC ought to be in receivership. Which is what then happened. Whoops. The loss emanating out of this occurrence "was particularly severe." The company was also in default under its Financing Agreement with Cerberus Business Finance LLC. This perfect storm led to a negotiation and restructuring support agreement with Cerberus and TCW Asset Management Company, which will convert a portion of their claims under the financing agreement into 100% of the company's equity. The lenders will provide a $15.5mm DIP credit facility.
• Jurisdiction: D. of Delaware
• Capital Structure: $223mm debt (Cerberus Business Finance LLC)    
• Company Professionals:
  • Legal: Hughes Hubbard & Reed LLP (Kathryn Coleman, Christopher Gartman, Jacob Gartman) & (local) Pachulski Stang Ziehl & Jones LLP (Laura Davis Jones, James O'Neill, Peter Keane)
  • CRO/Financial Advisor: Duff & Phelps LLC (James Feltman)
  • Financial Advisor: Conway MacKenzie Management Services LLC
  • Claims Agent: Prime Clerk LLC (*click on company name above for free docket access)
• Other Parties in Interest: 
  • DIP Lender: Cerberus Business Finance LLC
• Official Committee of Unsecured Creditors
  • Legal: Kilpatrick Townsend & Stockton LLP (David Posner, Gianfranco Finizio, Kelly Moynihan) & (local) Morris James LLP (Carl Kunz III, Brenna Dolphin)
  • Financial Advisor: Province Inc. (Sanjuro Kietlinski)

Updated 4/2/18