Schulte represented Cerberus Business Finance LLC and TCW Asset Management Company LLC and their respective affiliates in their acquisition of Patriot Services LLC (now known as Carrier & Technology Solutions LLC) through a Chapter 11 plan of reorganization.
Patriot National, Inc., a leading provider of technology and outsourcing solutions to the insurance industry, has agreed to be acquired by certain funds and accounts managed by each of Cerberus Business Finance, LLC and its affiliates and TCW Asset Management Company LLC. The transaction will be effectuated under a plan of reorganization pursuant to the terms of a restructuring support agreement (“RSA”) between Patriot National and its lenders, Cerberus and TCW, under which the Company and its direct and indirect U.S.-based subsidiaries will file voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code.
The Company expects that it will continue to operate its business in the ordinary course and the Chapter 11 filing is not expected to have a meaningful impact on the Company’s day-to-day operations. Specifically, the Company intends to continue to provide uninterrupted service to all of its carrier customers in accordance with the terms of the current agreements. Furthermore, it is anticipated that all commissions due to brokers who commit to continue their business relationships with the Company will be paid in the ordinary course of business or in full under the Plan. The Company expects the reorganization, which is subject to the completion of definitive documentation and regulatory approval, to be completed early in the second quarter of 2018.
Under the RSA announced today, certain funds and accounts managed by Cerberus and TCW will convert a portion of their claims under the financing agreement in consideration for 100% of the new equity to be issued in Patriot National and the Subsidiaries under the Plan. All existing equity interests in Patriot National and the Subsidiaries will be extinguished, and Patriot National will no longer have any affiliation with its founder and former CEO Steven Mariano, who resigned earlier this year.
Schulte advised Cerberus and TCW with business reorganization partner Adam Harris (Picture) and associate Lucy Kweskin. The team also included tax partner Kurt Rosell; bank regulatory partner Joseph Vitale and associate Jessica Romano; finance partner Eliot Relles and special counsel Joseph Fastiggi; M&A and securities associates Andrew Fadale and Sarah Sullivan; investment management associate Matthew Savoff; employment & employee benefits partners Ian Levin and Holly Weiss, special counsel Stephen Brecher and associate Adam Gartner; and intellectual property, sourcing and technology special counsel Scott Kareff.
Involved fees earner: Adam Harris – Schulte Roth & Zabel; Lucy Kweskin – Schulte Roth & Zabel; Kurt Rosell – Schulte Roth & Zabel; Joseph Vitale – Schulte Roth & Zabel; Jessica Romano – Schulte Roth & Zabel; Eliot Relles – Schulte Roth & Zabel; Joseph Fastiggi – Schulte Roth & Zabel; Andrew Fadale – Schulte Roth & Zabel; Sarah Sullivan – Schulte Roth & Zabel; Matthew Savoff – Schulte Roth & Zabel; Ian Levin – Schulte Roth & Zabel; Holly Weiss – Schulte Roth & Zabel; Stephen Brecher – Schulte Roth & Zabel; Adam Gartner – Schulte Roth & Zabel; Scott Kareff – Schulte Roth & Zabel;
Law Firms: Schulte Roth & Zabel;