Solution Trust Negotiates Favorable Cygnus Sportswear Deal

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Solution Trust Negotiates Substantial Debt Reduction and Amicable Out of Court Deal for Cygnus Sportswear

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Patience, industry and business acumen and a dash of moxie all play a critical role in assisting the parties to navigate the various hurdles that must be overcome to effectuate and leverage a successful transaction.

Solution Trust, a leading corporate restructuring and trustee related services firm, announced today the results of its successful representation of KSDS, Inc., dba Cygnus Sportswear (“Cygnus”), a sportswear wholesaler with manufacturing facilities in South Asia and distribution facilities in the United States and Europe, in a sale of substantially all of Cygnus’ assets to Knit Concepts, a textile company engaged in manufacturing and exporting knitted garments.

Peter Kravitz, Solution Trust Founder and Managing Principal, was hired by Cygnus as its Chief Restructuring Officer. Upon engagement, Mr. Kravitz immediately downsized and relocated the corporate headquarters and led sensitive negotiations with its creditors to effectively reduce and manage Cygnus’ debt and liquidity issues. Following months of intense negotiations, with the assistance of Hamid Rafatjoo, a Partner in Venable LLP’s Los Angeles Office, Cygnus recognized an approximately sixty percent (60%) reduction in its senior secured credit facility. This favorable outcome led to the successful sale of substantially all of Cygnus’ assets to Knit Concepts. The reorganized company will continue to operate under the Cygnus Sportswear brand name.

“When dealing with a highly leveraged balance sheet and severe liquidity issues, you need to be creative and ignore traditional roadblocks,” said Mr. Kravitz. “Patience, industry and business acumen and a dash of moxie all play a critical role in assisting the parties to navigate the various hurdles that must be overcome to effectuate and leverage a successful transaction. The commitment of all groups involved allowed for the avoidance of both bankruptcy and liquidation and gave way to a beneficial outcome.”

About Solution Trust: Solution Trust is a boutique firm of senior business and legal consulting professionals specializing in corporate governance, restructuring and trustee related services. Solution Trust professionals provide value through their roles in senior management such as Chief Restructuring Officers, Trustees of Family, Liquidating, Creditor and Litigation Trusts, and members of Trust Advisory and Oversight Boards and Boards of Directors.

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