Case History#5   The Company A growing services company. The Problem CSI was retained by this company to locate financing to fund additional growth. Immediately on beginning the engagement, it became evident that the company’s financial records were in disarray. Payables and receivables were inaccurate, the company had accumulated substantial losses, and actually had a large negative net worth. Numerous creditors and the Internal Revenue Service were threatening legal action. The company’s lawyer was claiming a substantial ownership interest in the company. The company’s owner was considering a loan proposal made by a banker he had recently met socially. The Solution CSI developed a reorganization plan that reduced the breakeven point by more than 30%, a level that would produce a profit at current business levels every month. Using information furnished by the client, we implemented a cash plan and created pro forma statements for twelve months. Extended terms were arranged with creditors and the IRS. A plan was drawn to broaden the market base to fund employment levels that could deal with the unplannable peak loads that had created customer service problems in the past. The loan proposal was analyzed, and it was concluded that it was not a loan proposal at all, but a disguised attempt to gain ownership and control of the company. The situation with the company lawyer was analyzed, and it was determined that, although there was substantial disagreement about what had actually been said, no one could produce a written agreement that the lawyer had an ownership interest. The Result The parts of the reorganization plan implemented resulted in a major reduction in operating expenses, a return to profitability and a positive cash flow. Corporate Strategies associate William Goldberg negotiated with the lawyer and arranged for an agreement where the lawyer relinquished any claims on the business in exchange for fees for services, payable according to a deferred payment plan. The banker, when it became apparent that the client was aware of the ramifications of the agreement, rescinded his offer   Case History#1 Case History#2 Case History#3 Case History#4 Case History#5

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