PROBLEM RESOLUTION
Companies that are growing, entering new projects or joint ventures, acquiring companies or borrowing
excessive funds will almost always encounter some type of serious commercial or financial problem that
requires prompt attention and resolution. Examples of serious problems include:
- breaking the financial covenants of a corporate loan agreement, and having the
bank demand payment
- disputes between joint venture partners over policies and distributions of funds
- disputes between joint venture partners where the ventures were formed to effect
contracts for third parties, and where the disputes affected the ventures' performance.
- credit defaults for financial, character or criminal reasons.
William "Chip" Gehle has had significant experience in problem resolution, workouts, turnarounds,
litigation and bankruptcy during his banking, corporate and consulting career. Examples include:
- Managing a troubled three way joint venture with Mexican and Brazilian partners to construct offshore
platforms for Pemex. The Mexican partner filed a fraudulent lawsuit against both other partners, never
served papers, and obtained default judgments worth $40 million. Because of close “on the ground”
relationships, obtained notice of the judgment just in time to file an injunction in Mexican court, before
the judgment was executed against my employer and the Brazilian joint venture partner. Ultimately,
negotiated a settlement resulting in the satisfactory completion of construction projects for Pemex,
and in the recovery of $30 million for my employer and the Brazilian partner.
- Working with Enron Engineering & Construction Company pre- and post-bankruptcy, he was
responsible for the sale of assets held as collateral, for the sale of companies with net operating losses,
for the negotiation of settlements related to numerous claims from project owners, subcontractors and
suppliers. He represented the company from commercial perspective in litigation resulting in a
favorable $22 million judgment through a jury trial.
- Managing the turnaround of a manufacturer of modular buildings used in remote and severe weather
sites, based in the Bahamas. He inherited a $14 million troubled loan, developed the strategy of
financing new contracts on a project by project basis, sweeping a pre-determined amount of the profit
margin of each project until the debt was reduced to acceptable levels. When confidence and
reasonable debt levels were restored, normal lending was resumed under a revolving credit.
- Managing a $30 million syndicated loan to a Texas distributor of heavy equipment. The primary
owner of the business died during a recessionary period and left the business to his two sons.
The sons resisted any cutbacks in the business and the business rapidly lost 2/3 of its net worth,
placing the loan in financial jeopardy. He led negotiations of the bank syndicate with the borrower and
convinced the borrower to adopt cost savings and working capital preservation plans. He then
assisted the company in refinancing with the captive finance company of the equipment manufacturer.
- Managing a $20 million revolving credit facility for a Mexican contractor to Pemex. Although the
company performed very well, his employer wanted out, due to a change in corporate strategy. He
convinced his employer to work with the borrower through the completion of all existing contracts, and
assisted the client in obtaining refinancing by providing an explanation of appropriate financing
structure to replacement lenders, and a favorable reference.
- Managing a $30 million syndicated loan to an Argentine oil and gas exploration company to build a
jack-up drilling platform. When the company entered a dispute with the US jack up contractor, work
stopped and the loan was in jeopardy. He convinced the syndicate to post a $14 million standby letter
of credit in favor of the contractor, that was payable in favor of the contractor if our client lost
arbitration with the contractor. Work resumed on the platform, and ultimately our client won the
arbitration decision. No payment was made under the standby letter of credit, the platform was
completed and employed, and the loan was ultimately repaid from oil production revenues.
- Inherited 22 past due loans made by a money center bank in Mexico, where export credit insurance
was voided due to product disputes. He negotiated settlements or extended repayment plans that were
honored by most of those borrowers.
Tel. (1) 832-878-4614, wgehle@internationaldiligence.com
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