The Company is a manufacturer of AC and DC motors.  The AC motors are used primarily in the refrigeration industry, while the DC motors are used in a variety of industries, including automotive and agriculture.

The Company had been generating annual EBITDA of $4 to $5 million and was capitalized with a combination of Senior and Subordinated debt totaling approximately $17 million.

During the two preceding years, the Company lost one of its major customers to a foreign source and its CEO to an illness.  Annual EBITDA dropped to approximately $1.5 to $2.0 million.

The Company brought in a new CEO. The new CEO developed a plan to stabilize operations and improve profitability, as well as address the foreign threat to its customer base.

FDP was asked to perform a limited review of his plan, its actions and strategies.  While concurring with the plan, the fact remained that the Company was significantly over-levered and it was unlikely that the Company would be able to service its debt from future profits.

Prior to FDP’s engagement, the Company had hired an investment banker to sell the Company.  The investment banker was not experienced in selling distressed assets and the sale engagement was subsequently turned over to FDP.

FDP conducted an auction for the Company’s assets, found a buyer and negotiated the sale of the assets.