RESTRUCTURING AND SALE OF ASSISTED LIVING FACILITIES IN ALABAMA & GEORGIA

Recommended by the SEC and Served as Court Appointed Receiver

In 2017, HMP was recommended by the SEC to oversee 9 Assisted Living and Memory Care facilities in Georgia and Alabama in
payment default of bonded debt totaling $63M. Within a year of HMP’s appointment all 9 facilities were sold through a court
approved stalking horse sales process. Subsequently, HMP was recommended by BOKF, N.A, as indenture trustee, to serve as
receiver over 4 SH facilities with bonded debt totaling $33M.

Issues

  • Owner/Operator stopped making debt service payment to indenture trustees
  • Limited reserve funds to fund operations and implement turnaround strategy
  • Staffing levels (e.g., staff turnover, competency)
  • Commingling of funds between separately bonded communities

Approach

  • Review the current situation with the indenture trustee and workout counsel
  • Assemble an appropriate team for the assignment (i.e., legal, accounting)
  • Tour the facility
  • Interview key members of the management, administrator and staff
  • Evaluate current operations and financial performance
  • Prepare a written assessment of the current situation for the indenture trustee and the court
  • Implement plan identified in assessment

Results

Similar Recent or Ongoing Assignments (Bonded Debt Totaling $33M)

  • Court Appointed Receiver for FHR-Yuma Assisted Living Facility, located in Yuma, AZ (Case #:CV2016-017008)
  • Court Appointed Receiver for American Family Services, located in Parksley, VA (Case #: 2:17-cv-00167). AFS owns an Assisted
    Living Facility and a Skilled Nursing Facility located on a single campus on the Eastern Shore of Virginia
  • Court Appointed Receiver for Decatur ALF Group, LLC located in Alabama (Case #: 5:17-cv-02141-HNJ) Westminster ALFs –
    http://westminsteralreceivership.com/
  • Court Appointed Receiver for Cullman ALF Group, LLC located in Alabama (Case #: 5:17-cv-02140-AKK) Westminster ALFs –
    http://westminsteralreceivership.com/
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