Large Company Turnaround



Large Company Turnaround - Trident USA Health Services
James Peck, Morrison & Foerster LLP
Frank A. Oswald, Togut, Segal & Segal, LLP
David M. Posner, Kilpatrick Townsend & Stockton LLP
James J. Mazza, Skadden, Arps, Slate, Meagher & Flom LLP 
Mark Buschmann, PJT Partners
Russell Perry, Ankura Consulting Group LLC
William Jordan, Alston & Bird
David MacGreevey, AlixPartners, LLP
Robert Britton, Paul, Weiss, Rifkind, Wharton & Garrison LLP
David Hilty, Houlihan Lokey

About the Turnaround:
On September 20, 2019, TridentUSA Health Services, the nation’s largest mobile diagnostic healthcare services provider, completed a successful restructuring, which delivered the company’s balance sheet by approximately $600 million, saved nearly 5,600 jobs, and preserved Trident’s going-concern operations. 

This turnaround was a rare operational restructuring of a services business facing liquidity constraints attributable to industry headwinds. In particular, the company experienced a sustained decline in its financial performance, which had been compounded by significant challenges collecting receivables from a distressed skilled nursing facility customer base. Those factors restricted the company’s ability to service its debt and make capital expenditures necessary for its technology-driven business.

Even after an out-of-court recapitalization in April 2018 that injected $40 million of new money, the company continued to face persistent headwinds which affected customers, write offs of significant receivables, increased pressure on reimbursement rates, intense capital requirements, and constrained liquidity.

Accordingly, in February 2019, Trident and 22 of its affiliates filed for Chapter 11 with approximately $800 million of prepetition debt. To address its operational issues, less than 40 days into the cases the company and its advisors delivered a business plan that was premised on a “shrink to grow” strategy designed to turn around their operations. The company began to implement this turnaround plan, which focused on: (i) right-sizing its footprint to refocus on its profitable operations; (ii) rationalizing its x-ray, lab, and ultrasound service offerings; and (iii) improving collections.  

From a legal perspective, Trident’s turnaround story is one that involved the complex intersection of healthcare, finance, and bankruptcy law.

First, Trident faced challenges to its 2018 recapitalization asserted by secured lenders that had previously consented, as well as the creditors’ committee, arguing that the 2018 recapitalization should be unwound. After significant litigation and negotiations, the parties resolved these matters, providing increased recoveries that included payments to unsecured creditors of nearly 10 times what was originally proposed.

Second, two qui tam relators filed prepetition complaints seeking $489 million under the False Claims Act, alleging that Trident engaged in an illegal “swapping” scheme to price services below cost in exchange for referrals of Part B Medicare business. The relators also sought a determination that their claims were non-dischargeable, which threatened Trident's reorganization. After weeks of mediation with the qui tam relators and the U.S. government overseen by Hon. James Peck, the company settled the claims for $9.5 million and received full releases.

With these accomplishments, Trident’s Chapter 11 plan was accepted by its secured creditors and by general unsecured creditors on a consolidated basis. Judge Sean Lane confirmed the plan, and the company emerged from bankruptcy.  As a result, Trident continues to provide essential medical diagnostic services to key customers, ensuring patients’ access to these critical services.

ConferenceAgenda

Agenda subject to change - all times in CDT
 

Tuesday, September 29, 2020  
8:00 a.m. - 11:30 a.m. 

Morning Coffee Shop Chat Rooms

Sponsored by MACCO Restructuring Group, LLC

8:45 a.m. - 9:00 a.m. Daily Announcements 
9:00 a.m. - 9:30 a.m.

Guided Meditation Class

Sponsored by Ritchie Bros

9:00 a.m. - 10:00 a.m.

Opening Session: Mega Trends 3.0               

Sponsored by Saul Ewing Arnstein & Lehr LLP

10:00 a.m. - 10:20 a.m.  VIP Access with Mega Trends 3.0 Panelists
10:30 a.m. - 11:30 a.m. 

TMA NOW Event 

Sponsored by AlixPartners, LLP

12:30 p.m. - 1:30 p.m.

General Session: Options! Options! Options! Alternatives to Bankruptcy       

Sponsored by Sherwood Partners, Inc.

12:30 p.m. - 3:30 p.m. 

Re-Energized Afternoon Coffee Shop Chat Rooms

Sponsored by MACCO Restructuring Group, LLC

1:30 p.m. - 1:50 p.m.  VIP Access with Options! Options! Options! Alternatives to Bankruptcy panelists 
2:00 p.m. - 3:00 p.m.

Education Session: Contested Issues in DIP Financing in the Uncertain World of Our New Normal

Sponsored by Riemer & Braunstein LLP

2:00 p.m. - 3:00 p.m.

Education Session: Managing Chaos in the Era of Loan Defaults: What Lenders and Borrowers Need to Know

Sponsored by McCarter & English, LLP

4:00 p.m. - 7:00 p.m. 

Spiked Coffee Shop Chat Rooms

Sponsored by MACCO Restructuring Group, LLC

4:00 p.m. - 5:00 p.m.  TMA 101: First-Timers and New Members Event 
5:00 p.m. - 6:00 p.m. 

Education Session: The Dark Days and Nights for the Sports Industry

Sponsored by FTI Consulting, Inc.

5:00 p.m. - 6:00 p.m.

Education Session: Beyond the Transaction: Stories of Post-Merger Integrations

Sponsored by CohnReznick LLP

6:00 p.m. - 7:00 p.m. 

TMA Variety Show 

Sponsored by Ritchie Bros

Wednesday, September 30, 2020  
8:00 a.m. - 8:30 a.m. 

Turnaround Yoga Class 

Sponsored by Ritchie Bros

8:00 a.m. - 11:30 a.m. 

Morning Coffee Shop Chat Rooms 

Sponsored by Newpoint Advisors Corporation

8:45 a.m. - 9:00 a.m. Daily Announcements 
9:00 a.m. - 10:00 a.m.

General Session: They Might Be Giants: The Titans of Today and Their Lessons from Along the Way

Sponsored by Hilco Global

10:00 a.m. - 10:20 a.m.  VIP Access with They Might Be Giants: The Titans of Today and Their Lessons from Along the Way panelists 
10:30 a.m. - 11:30 a.m. 

TMA NextGen Event 

Sponsored by Arch + Beam

12:30 p.m. - 1:10 p.m.

Keynote: Mariana Mazzucato: Never Waste a Crisis: Rethinking Capitalism During COVID-19

Sponsored by Gordon Brothers

12:30 p.m. - 3:00 p.m.

Re-Energized Afternoon Coffee Shop Chat Rooms

Sponsored by Newpoint Advisors Corporation

1:10 p.m. - 1:30 p.m.  VIP Access with Keynote Speaker 
2:00 p.m. - 3:00 p.m.

Education Session: Figuring Out Retail: What Was Already Bad Just Got a Lot Worse

Sponsored by Hilco Global

2:00 p.m. - 3:00 p.m.

Education Session: The Impact of COVID-19 on Higher Education: A Schism of Debt, Endowments, and Educational Challenges, Too

Sponsored by Alvarez & Marsal

4:00 p.m. - 5:00 p.m. 

TMA Awards Celebration: "Better Together Roundtable"

Sponsored by Ritchie Bros

4:00 p.m. - 7:00 p.m. 

Spiked Coffee Shop Chat Rooms

Sponsored by Newpoint Advisors Corporation

5:00 p.m. - 6:00 p.m. 

The Business IMPACT of Diversity and Inclusion: Strategic Conversation Workshop

Sponsored by Burford Capital

6:00 p.m. - 6:20 p.m. VIP Access with Diversity and Inclusion Workshop panelists 
6:00 p.m. - 7:00 p.m.  TMA Family Feud
Thursday, October 1, 2020  
8:00 a.m. - 11:30 a.m. 

Morning Coffee Shop Chat Rooms 

Sponsored by Gulf Coast Business Credit

8:45 a.m. - 9:00 a.m. Daily Announcements 
9:00 a.m. - 9:30 a.m. 

Impact Fitness Class 

Sponsored by Ritchie Bros

9:00 a.m. - 10:00 a.m.

Keynote: Duncan Wardle, Innovation & Creativity in a Virtual World

Sponsored by Burr & Forman, LLP

10:00 a.m. - 10:20 a.m.  VIP Access with Keynote Speaker Duncan Wardle 
10:30 a.m. - 11:30 a.m. 

TMA Talks: International 

Sponsored by Deloitte

12:30 p.m. - 1:30 p.m.

General Session: Will the Patient Survive? The Healthcare Industry in a COVID-19 World

Sponsored by Carl Marks Advisors

12:30 p.m. - 3:00 p.m. 

Re-Energized Afternoon Coffee Shop Chat Rooms

Sponsored by Gulf Coast Business Credit

1:30 p.m. - 1:50 p.m. VIP Access with Will the Patient Survive? The Healthcare Industry in a COVID-19 World panelists 
2:00 p.m. - 3:00 p.m.

Education Session: Intentions in Retention: Ethical Considerations When Being Retained in Bankruptcy Cases     

Sponsored by SM Financial Services Corporation

2:00 p.m. - 3:00 p.m. 

Education Session: Market Liquidity and Impact

Sponsored by Deloitte

3:30 p.m. - 4:00 p.m.  VIP Access 
4:00 p.m. - 7:00 p.m. 

Spiked Coffee Shop Chat Rooms

Sponsored by Gulf Coast Business Credit

4:00 p.m. - 5:30 p.m. 

Virtual Capital Connection + Networking Event

Sponsored by Duff & Phelps, LLC and Getzler Henrich & Associates LLC

5:30 p.m. - 6:30 p.m. 

TMA 'Big Tent' Celebration

Sponsored by Ritchie Bros