Residential Mortgage Investment Fund
Industries
Force 10 served as the Chief Restructuring Officer and Financial Advisor to this real estate loan investment fund, which was reorganized under Chapter 11.
PME Mortgage Fund, Inc. began as a for-profit, sponsor-led “investment club” in the 1980s. The club’s “members” loaned money to PME on an unsecured basis, and PME then loaned the investors’ capital on a 1st, 2nd, or 3rd-lien basis. Over the years, PME had foreclosed on many of its loans. The sponsor then allegedly began to profit from the information and sophistication disparity among club members by purchasing Notes from PME at a discount, exchanging real estate, and restructuring investment terms – all in the name of providing liquidity to the investors/club members. Litigation ensued, and Force 10 was retained as Chief Restructuring Officer and Financial Advisor to guide PME through an orderly Chapter 11 liquidation.
We initially stabilized the administration and collection of notes, then analyzed and determined which projects to liquidate and which to complete. We managed an orderly liquidation process of its REO portfolio, investigated transactions, and performed funds tracing to initiate and support breach of fiduciary actions and achieve settlements. Force 10’s involvement resulted in Chapter 11 creditors receiving recoveries far exceeding those paid to creditors who liquidated before Chapter 11.
