When unsecured creditor committees are formed, indenture trustees are appointed more often than individual bondholders. Investors benefit from a committee participant that understands their strategies, needs and mindset, is willing to be an active advocate for investors’ objectives, and is commercial – all while understanding their duties as a committee member.

When bondholders lack confidence in the indenture trustee, they often choose to drive the restructuring process themselves, which regularly results in these holders receiving MNPI and becoming restricted.

With respect to syndicated loans (whether performing or non-performing), borrowers typically share information with lenders that they do not share with bondholders or equity. If lenders opt to receive this private information they may become restricted from trading in other parts of the company’s capital structure. If lenders opt not to receive it, they become disadvantaged from an information standpoint and therefore open themselves to risk.

Investors may choose to delegate activities that require the receipt of material non-public information to Ankura Trust as indenture trustee, loan administrative agent or creditor representative with the confidence knowing our professionals have:

• The expertise and skillsets to drive situations towards outcomes desired by investors; and
• The commercial-awareness and experience to know when it is appropriate to approach investors with the option of receiving material non-public information.

Our involvement can benefit investors by minimizing the time they are restricted from trading.

Today, many indenture trustees can be passive or slow to respond to the needs of investors. This often results in the investor taking a more involved/active role in the restructuring process than they otherwise would, resulting in the consumption of valuable personnel-hours for the investor.

Engaging Ankura Trust to lead and execute many of the day-to-day, time consuming but necessary activities of a restructuring process creates leverage for investors to free up their own human resources. This enables teams to focus on other critical activities such as the strategic and decision-making aspects of the case at hand and/or identifying new investment opportunities – thereby significantly reducing or eliminating the opportunity cost of extensive participation in a restructuring.

Ankura Trust will not commit our capital to transactions and only works for creditors, thereby avoiding the potential relationship conflicts of more traditional administrative agents.

Therefore, whether in performing or non-performing situations, investors can be confident that Ankura Trust will proactively monitor the financial health of the borrower/issuer, challenge covenant calculations and the related treatment of corporate transactions (i.e. with respect to EBITDA add-backs, permitted transactions, etc.) to ensure full compliance with the applicable credit agreement or bond indenture, and communicate information as and when needed.

We believe our involvement as either indenture trustee, loan administrative agent, or creditor representative will serve as an additional line of defense for investors who may be resource constrained and ultimately lead to faster identification of issues related to borrower/issuer non-compliance. This will also provide the lender with the option to remain free from receiving MNPI, and therefore trading restrictions, should they so choose.