Patriarch Partners to Step Down as Collateral Managers of Zohar Funds

Lynn Tilton to Maintain Her Portfolio Company Roles and Ownerships

NEW YORK--(BUSINESS WIRE)-- Lynn Tilton, Chief Executive Officer of Patriarch Partners, LLC, today announced that her Patriarch Partners entities are stepping down as Collateral Managers of Zohar CDO 2003-1, Limited; Zohar II 2005-1, Limited; and Zohar III, Limited (collectively, the “Zohar funds”). Ms. Tilton and her firm will now focus on managing the more than 70 operating companies in the Patriarch portfolio. Ms. Tilton looks forward to working with a new Collateral Manager, whose appointment has yet to be announced, to ensure a smooth transition.

Patriarch’s resignation will have no effect on Ms. Tilton’s role as CEO of Patriarch Partners or her roles as manager, and in some cases CEO, of the portfolio companies she owns. Patriarch, its affiliates and its staff will operate as a family office and private equity company for the portfolio of businesses.

Ms. Tilton said, “The constant litigation between Patriarch and MBIA that began in 2009 and continues today has created an unproductive and untenable relationship between parties who by definition should be aligned. Since 2011, I have publicly represented to the controlling classes and the noteholders that my sole interest in serving as collateral manager was to serve the best interest of the funds, and that Patriarch was willing to transfer their collateral management roles if such would be in the best interest of the funds. The battles have led me to make the decision that I could no longer leave this choice open, but instead my firm and I must step down so we can focus fully on driving the value of the portfolio companies.”

Concurrent with this resignation, Patriarch Partners XV, LLC, the largest creditor of Zohar CDO 2003-1, Limited, will be withdrawing its opposition to the motion to dismiss the involuntary Chapter 11 cases that it filed for Zohar I. Patriarch XV filed the involuntary petitions in order to protect itself and Zohar I after years of fruitless restructuring negotiations with MBIA and with the good faith hope that a consensual plan of restructure could be accomplished. Despite Patriarch’s efforts, it has become clear that the parties will be unable to reach a consensual resolution in these matters. In order to avoid any further negative impact on the underlying portfolio companies, Patriarch has chosen to step down as Collateral Managers of the Zohar funds and focus its full attention on the portfolio companies.

About Patriarch Partners

Patriarch Partners, LLC, is an investment firm managing investments in more than 70 companies across 14 industry sectors. Patriarch and its affiliated entities focus on the acquisition and invigoration of undervalued iconic American brands where time, capital and sound strategy can rescue a business and restore value, creating and preserving jobs in America. The firm is devoted to rebuilding America one company at a time, one job at a time. Since 2000, through affiliated investment funds, Tilton has had ownership in and restructured more than 240 companies with combined revenues in excess of $100 billion, representing more than 675,000 jobs. Current investments include Dura Automotive, Spiegel Catalogs, MD Helicopters, Rand McNally, and Stila Cosmetics. Tilton’s platform is one of the largest woman-owned businesses in the country.

View source version on businesswire.com: http://www.businesswire.com/news/home/20160205005645/en/

Patriarch Partners, LLC
Richard White, 212-825-6836
[email protected]

Source: Patriarch Partners, LLC

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