Priority 1 Holdings

Summary

Lender Advisor

Lexington Park, MD

Priority 1 is a diversified international aerospace and defense company with over three decades of experience to provide Intelligence, surveillance and reconnaissance technical operations.

Priority 1 faced a crossroads as it attempted to rebound from the termination of the AFRICOM program and recover from adversely affected financial performance in a time when the Company’s revolving credit facility was frozen. The Company lacked sufficient liquidity to continue quarterly debt service and provide a working capital cushion to operate on a normalized basis..

Key Challenges

Liquidity Constraints

Covenant Default

Tight Working Capital Position

Leveraged Capital Structure

Engagement Highlights

Reviewed historical and projected financials to identify performance trends.
Assessed management’s prior cost-cutting initiatives and their progress.
Reviewed and discussed the business development process, including Priority 1’s backlog and pipeline, to project any necessary liquidity needs.
Visited the Company for detailed discussions with management and tours of Priority 1’s facilities.
Developed high-level financial sensitivity models to extrapolate the Company’s base forecast into 2022 and to forecast results based on various win-loss assumptions, higher-lower revenue levels, and potential new programs.

Priority 1 Holdings

Summary

Lender Advisor

Key Challenges

Engagement Highlights

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