Archive for September, 2020

Good afternoon

Based on our over 40 years of crisis management, restructuring and enterprise sale experience, we have never seen a financial crisis where uncertainty is greater than it is now.  Business leaders know that their enterprises will take a major economic hit, but they simply do not know how large or when it will be, where it will hurt most, or how long it will last. That uncertainty is causing businesses to “freeze” their decision-making.  This has been going on since April, 2020.

Gerbsman Partners believes that “freezing in place” will worsen financial and human outcomes and may even be fatal for some businesses. We strongly recommend that companies review their contingent real estate expenses, revenue prospects, liabilities, and creditor/senior lender issues and plan for the worst case.

Investors, board members, senior management and lenders must develop a crisis plans “NOW” for under-performing, under-capitalized and distressed companies. Plans will change as new information emerges, but implementing a crisis planning process immediately is vital, as it drives stakeholders to face hard realities and to take key actions early.  The ultimate objective here is to “Maximize Enterprise Value”.

Gerbsman Partners and its Board of Intellectual Capital can help you develop action plans for maximizing and monetizing enterprise value, and then implement those plans.

We look forward to assisting.


Steven R. Gerbsman – Principal, Gerbsman Partners

Robert R. Tillman – Member of Gerbsman Partners Board of Intellectual Capita



Terminating/Restructuring Prohibitive Real Estate, License, Payables & Contingent Liabilities


Gerbsman Partners has been involved with numerous national and international equity sponsors, senior/junior lenders, investment banks and equipment lessors in the restructuring or termination of various balance sheet issues for their technology, life science, medical device, cyber security, solar and cleantech portfolio companies. 

These companies were not necessarily in crisis, but had cash (in some cases significant cash reserves) and/or investor groups that were about to provide additional funding. In order to stabilize their Go-Forward-Plan and maximize cash resources for future growth, there were specific needs to address Balance Sheet and Contingent Liability issues as soon as possible.

Some of these areas where Gerbsman Partners has assisted, these companies have been in the process of termination, restructuring and/or reduction of:

Prohibitive Executory Real Estate Leases, Computer and Hardware-related Leases and Senior/Sub-debt Obligations

Gerbsman Partners was the “innovator” in creating strategies to terminate or restructure prohibitive real estate leases and senior and sub-debt obligations.

To date, we have terminated or restructured $810 million of such obligations for private and public companies, and which has allowed them to return to financial viability.

Accounts/Trade Payable Obligations

Companies in a crisis, turnaround or restructuring situation typically have account and trade payable obligations that become prohibitive for the viability of the company on a go-forward-basis. Gerbsman Partners has successfully negotiated mutually beneficial restructurings that allowed all parties to maximize value based on the reality or practicality of the situation.

Software and Technology-related Licenses

As per the above, software and technology-related licenses need to be restructured/terminated in order for additional capital to be invested in restructured companies. Gerbsman Partners has a significant, successful track record in these areas.


About Gerbsman Partners

Gerbsman Partners focuses on maximizing enterprise value for stakeholders and shareholders in underperforming, undercapitalized and undervalued companies and their intellectual properties. Since 2001, Gerbsman Partners has successfully maximized the values of 109 companies in a wide and diverse spectrum of industries. In the process, GP has successfully restructured/terminated over $810 million of real estate executor contracts and equipment lease/sub-debt obligations, and has assisted in over $2.3 billion of financings, restructurings and M&A transactions.

Gerbsman Partners has offices and strategic alliances in Boston, New York, Washington DC, McLean VA, San Francisco, Orange County, Europe and Israel.



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  Convertible Debt Terms – Survey of Market Trends 2019/2020  

By Evan Bienstock and Alicia Ryan

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The convertible debt market has remained remarkably stable over the last 15 months, despite considerable economic uncertainty related to the COVID-19 pandemic. Fenwick’s latest Convertible Debt Terms – Survey of Market Trends analyzes more than 100 issuer-side convertible debt transactions covering the period from January 1, 2019, through March 30, 2020. Serving as a resource for startup founders, investors and others interested in convertible debt market trends, this report also includes a snapshot comparison of the full report period through Q2 2020.

Key Findings

  • Year over year, deal sizes are down slightly—from $1.62 million to $1.58 million—with the exception of late-stage deals.
  • Q2 2020, however, saw an increase in deal size and interest rate over the median from the 2019-2020 reporting period, likely a result of companies looking to extend their runway in response to COVID-19.
  • Conversion discounts remain the norm, even in later stage debt issuances.
  • Valuation caps remain standard practice for more than 80% of “first money” transactions, but drop steeply at later stages.
  • In change-of-control situations, such as the sale of a company, most deals provide for a premium payout that is a multiple on top of the repayment of the principal balance. In fact, as many as 68% of late-stage bridge transactions contain a change of control premium.


Full Report

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One cannot and must not try to erase the past merely because it does not fit the present.

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