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Crisis Management

Liquidity Management

  • VRS provides economic stakeholders with transparency around short term liquidity by developing detailed, bottom-up 13-week cash flow models and monitoring short term liquidity through routine variance reporting.
  • We routinely extend the timeline to execute a potential restructuring transaction by identifying and implementing near-term cost cutting initiatives and working capital improvements.
  • As CRO, we exercise business judgment for the company in managing disbursements and, when necessary, maintain exclusive control over cash as an independent fiduciary.
  • We protect a distressed company’s officers and directors with an acute understanding of, and hypersensitivity to, the fact that a distressed company may not continue to incur ordinary course trade debts without the ability to pay those obligations in the ordinary course.
  • In chapter 11 bankruptcies, we negotiate cash collateral and DIP financing budgets, routinely testify in support of motions to approve the use of cash collateral and/or DIP financing and ensure the administrative solvency of the chapter 11 estate.

Stakeholder Management & Communications

  • VRS believes that a core tenet of every successful restructuring is frequent, timely and transparent communication with key stakeholders in an empathetic manner, with an understanding of each stakeholder’s unique perspective.
  • We communicate with management and the board with a focus on their primary objective: preserving the going concern and saving jobs. 
  • We communicate with employees with an understanding that people continue working at a company in financial distress because they care about each other and about the success of the company, that its more than just a job. We also understand that sometimes the most jobs are preserved through a reduction in force and we are empathetic when this is a necessary path forward.
  • We communicate with lenders regarding strategic options, approaching the discussion from the lender’s point of view, focusing on maximizing recovery.
  • We communicate with trade creditors with an understanding of their goals of mitigating credit risk, getting accrued balances paid and preserving an ongoing customer in a manner that complements their own business success.
  • We communicate with equity holders with an understanding that equity investors often face not only the prospect of the loss of their investment, but also face creditors’ inquiries as to what went wrong, with an expectation that equity will contribute more capital to stabilize the business.