Shearman & Sterling’s Special Situations and Capital Solutions team of partners works across practice groups to develop innovative solutions to capital structure and other complex problems. Each member of our special situations interdisciplinary team—including Capital Markets, Leveraged Finance and Direct Lending, Restructuring, Litigation, Mergers & Acquisitions and Tax—has the expertise to address the issues that arise in this unique context and spends a substantial amount of their time working with many of the world’s leading hedge funds, private equity funds, direct lenders, CLOs and other institutional investors.

This dedicated special situations team provides our clients with solutions supported by our legal expertise in many jurisdictions where we practice across the globe, including financial centers of the U.S., Europe and Asia. Our global footprint enables us to serve clients worldwide and uniquely positions us to handle cross-border issues.

Examples of the types of representations that benefit from our approach to special situations include:

• Liability management exercises to reduce or modify indebtedness through exchange offers and debt buybacks
• Out of court balance sheet restructurings
• New money capital raises, including through private loans, note offerings and equity rights offerings
• Acquisitions of distressed companies and assets
• Equity-linked transactions, including preferreds, convertibles and PIPE transactions
• Leveraged recapitalizations
• Rescue Financings
• Litigation risk assessments and mitigation

Our team analyzes the nuances of complex credit structures to help our clients structure creative solutions. Clients benefit from our global expertise and 360-degree approach, which ensures that our clients have a command of the legal rights that drive each special situation. We identify opportunities to enhance securities and other investments and help our clients maximize recoveries, protect their interests and make informed investment decisions.

Capital solutions often involve multiple investors with differing and sometimes conflicting interests. Our team advises clients on litigation risks and, where needed, provides full-service litigation and trial advocacy services to resolve disputes arising in the context of a special situation or capital solution transactions.

The special situations team is led by a partner that is a former investment banker and hedge fund professional and includes members of our Financial Restructuring & Insolvency, Leveraged Finance, Capital Markets, M&A, Tax and Litigation practices.

Ad Hoc Groups

• Ad hoc group of noteholders | in relation to Newmont Goldcorp Corporation consent solicitation eliminating certain acquiror guarantee requirements in connection with the transfer of assets by the guarantor to a JV with Barrick Gold Corporation in exchange for consent fee.
• Ad hoc group of noteholders | in connection with senior notes issued by Tupperware Brands Corporation.
• Ad Hoc group of lenders | to U.S. Shipping.
• Nuverra Environmental Solutions Inc. | in its up-tiering exchange transaction and later in its prepackaged chapter 11 case.
• Largest bondholder | in connection with Chapter 11 cases of TerraVia Holdings.
• Dealer managers | on several billion dollars of exchange offers by Energy Future Intermediate Holdings for multiple series of its debt securities.

Financing Solutions

• Bank of America (as lead arranger, agent and letter of credit issuer) and certain other asset-based lenders | who have provided Macy’s Inventory Funding LLC, a newly formed financing vehicle, with a $3.15 billion asset-based inventory financing.
• Bank of America | as lenders to Neiman Marcus in connection with $900 million exit ABL financing and $125 million exit FILO financing for Neiman Marcus in connection with its emergence from chapter 11.
• Morgan Stanley Senior Funding, Inc. | as Administrative Agent on a $2.2 billion senior secured term loan B facility for Royal Caribbean Cruises Ltd. to finance working capital and other general corporate purposes.
• Carlson Travel, Inc. | on its restructuring of existing indebtedness, which included (i) an exchange offer, (ii) a consent solicitation, (iii) issuance of rights offering units consisting of new notes and shares of common equity of a newly-created holding company, (iv) an equity contribution by CTI’s principal shareholder and (v) an amendment and restatement of CTI’s revolving credit facility.
• Administrative agent and an ad hoc group of lenders | on an out of court restructuring for an oil field services company, consisting of (i) a non-traditional ABL revolving credit facility to finance working capital and other general corporate purposes; (ii) an amendment to its existing term loan facility and(iii) partial debt to equity swap.
• Ad hoc group of lenders | in connection with the provision of $190 million super priority financing to Hornblower Cruises and related transactions.
• Ad hoc group of lenders | in connection with the provision of stretch ABL facility to an oilfield services company and related restructuring transactions.
• Direct lender | in connection with the provision of rescue financing to the specialty retailer.
• Barclays Bank PLC | as Administrative Agent and collateral agent under a first lien facility, DIP financing, exit facility and new second lien facility for RCS Capital Corp.
• Citibank, N.A. | as Administrative Agent on a $1.75 billion senior secured superpriority debtor-in-possession financing for Weatherford International Ltd., Weatherford International plc and Weatherford International, LLC | consisting of (i) a $750 million revolving credit facility and (ii) a $1 billion term loan facility to finance general corporate purposes and bankruptcy-related expenses.
• Barclays Bank PLC | as Administrative Agent on a $110 million senior secured exit revolving credit facility for CTI Foods Holding Co., LLC to finance the repayment of the borrower’s DIP facility and to provide funds for general corporate purposes.
• Barclays Bank PLC | as Administrative Agent on an $80 million senior secured superpriority debtor-in-possession ABL revolving credit facility for CTI Foods Holding Co., LLC to finance general corporate purposes and bankruptcy-related expenses.
• Citibank, N.A. | as Administrative Agent on a $6.3 billion DIP financing for Energy Future Intermediate Holding Company LLC and EFIH Finance Inc., consisting of a $5.475 billion senior secured DIP term loan facility and an $825 million senior secured delayed draw DIP term loan facility.
• Citibank, N.A. | as Administrative Agent on an $800 million debtor-in-possession financing for Westinghouse Electric Company LLC consisting of $800 million senior secured superpriority term loans to finance cash collateralized letter of credit facility and general corporate purposes.

Litigation

• Citibank, N.A. | in its capacity as administrative agent and lender under a revolving credit agreement in connection with the chapter 11 bankruptcy cases of Valaris plc and certain of its subsidiaries, including in intercreditor litigation in the U.S. Bankruptcy Court for the Southern District of Texas.
• Southland Royalty Company | in its chapter 11 case, successfully prosecuted litigation with major midstream counterparty to establish that dedications of hydrocarbons in midstream agreements did not establish real property covenants burdening the company’s assets following a sale.
• A major financial institution | in a fraud case brought by investors in a CDO for which our clients acted as arranger and collateral manager.
• A financial institution | in connection with fraud claims brought by one of Korea’s largest banks seeking millions in damages regarding investments in seven different CDOs in 2005 and 2006.

M&A

• ArcelorMittal | in its $7 billion acquisition of Essar Steel with Nippon Steel Corporation under the Indian Insolvency and Bankruptcy Code.
• Magris Resources Canada Inc. | in connection with its stalking horse agreement to acquire substantially all of the assets of Imerys Talc America Inc., Imerys Talc Vermont Inc. and Imerys Talc Canada Inc. for $223 million.
• Avenue Capital Group | in its $175 million acquisition of Milacron Inc. with DDJ Capital Management, LLC, pursuant to 363 sale.
• Sagard Capital and Fairfax Financial | in their joint stalking horse bid to acquire the assets of Performance Sports Group.
• Prairie Farms | in connection with its acquisition of certain assets of Dean Foods in a court-approved sale process.
• JBS Holdings USA, Inc. | in the purchase of 64 percent of Pilgrim’s Pride Corporation pursuant to a $2.8 billion plan of reorganization.
• Fairfax Financial Holdings | in its joint “stalking horse” bid with Sagard Capital Partners to acquire all of the assets of Performance Sports Group Ltd.
• Landry’s Inc. | in connection with its stalking horse bid for the assets of RUI Holding Corp.
• Hunt Power Holdings L.L.C. | in pursuit of a $12 billion acquisition of Oncor Electric Delivery Company.
• Chinese state-owned enterprise | as potential stalking horse purchaser for the assets of Molycorp, Inc.

Restructuring

• Valaris plc Restructuring Cases | Representing Citibank, N.A., in its capacity as administrative agent and lender under a revolving credit agreement in connection with the chapter 11 bankruptcy cases of Valaris plc and certain of its subsidiaries.
• Stoneway Capital Corporation |  Representing Stoneway Capital Corporation and certain of its affiliates in connection with a restructuring of their bond and mezzanine debt.
• Ad hoc group of noteholders, | under pari passu first-lien notes, in connection with chapter 11 cases of Windstream Holdings.
• Southland Royalty Company Restructuring Case | representing Southland, a privately-held independent exploration and production company focused on the acquisition and development of hydrocarbons, as the debtor in its restructuring.
• Ad hoc group of counterparties | holding approximately 2,000 MWh in long-term PG&E power purchase agreements..
• PG&E Corporation Restructuring Cases | Represent several agents and ad hoc groups of lenders and noteholders to PG&E power purchase agreement counterparties.
• Ad hoc group of operating company noteholders | in connection with the restructuring of Frontier Communications and its affiliates.
• Medley Capital | Represent Medley in various complex workouts, including workouts utilizing foreclosure under Article 9 of the Uniform Commercial Code.
• LifeCare Holdings LLC Restructuring Cases | Represent Seaport Loan Products and Wilmington Trust as co-agents in connection with the Chapter 11 cases of LifeCare Holdings LLC and certain of its affiliates following the prepetition representation of an ad hoc group of term loan lenders to the company.
• Blackhawk Mining LLC Restructuring Cases | Represent a group of ad hoc first-lien lenders in connection with the Chapter 11 cases of Blackhawk Mining LLC and certain of its affiliates.
• Ad hoc group of equity holders | in connection with the chapter 11 case of AMR Corporation.
• A trading desk of a major bank | and distressed investment funds in connection with their investments in junior preferred stock issued by Fannie Mae and Freddie Mac.
• A distressed investment fund | in connection with Detroit’s Chapter 9 case.
• Puerto Rico | Represented numerous parties in connection with investments in defaulted securities issued by instrumentalities of Puerto Rico.
• Lehman Brothers Insolvency Proceedings | Represented Bank of America and Merrill Lynch in connection with their worldwide exposure to Lehman Brothers Holdings Inc. and its affiliates, including in connection with the U.S. Chapter 11 cases of various Lehman affiliates and SIPA proceeding of Lehman Brothers Inc.

Structured Credit

• Barclays | as part of the “big bank” derivative counterparty group in connection with the settlement of Barclays’ derivative claims pursuant to Lehman Brothers’ Chapter 11 plan.
• Various financial institutions | in connection with their derivatives exposure to Linn Energy, LLC, Penn Virginia Corporation, Atlas Resources Partners LP, Sandridge Energy, Inc., Breitburn Energy Partners LP, Halcón Resources Corporation and other oil and gas companies.
• Intercontinental Exchange, Inc. (ICE) | in connection with safe harbor/counterparty risk analysis as well as their exposure to MF Global Holdings Ltd. and its affiliates, including in connection with the U.S. chapter 11 cases of various MF Global affiliates and the SIPA proceeding of MF Global Inc.