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
- Stabilized organization; conducted sale
- Additional details can be found at Oxton Senior Living, LLC
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
- Court Appointed Receiver for Cullman ALF Group, LLC located in Alabama (Case #: 5:17-cv-02140-AKK) Westminster ALFs