Westport, CTÂ Worth Avenue Capital, LLC (WAC) negotiated both a forbearance agreement as well as a discounted payoff with a regional bank for a small staffing company.
In this transaction, WAC's client has had an outstanding commercial loan with a New England based regional bank for approximately 14 years. The loan was written by the bank as a revolving line of credit to the borrower for working capital purposes. Unfortunately, the borrower's cash flow weakened over the last several years and the loan went into default. The bank subsequently retained outside legal counsel to commence litigation against the borrower.
WAC was able to negotiate a settlement with the bank in which this institution not only agreed to grant the borrower a five year forbearance agreement but also agreed to waive approximately $50,000 in principal, past due interest, legal fees, etc. on a $300,000 loan. As part of this settlement, the bank has now ceased litigation against the borrower who now has an additional five years to repay the loan with the bank.