Case Study
Software
Company
The
company, founded in 1995, was in the business of developing and
selling software, services, and training.
The main operations were in California with a subsidiary overseas.
In
1997 the company began experiencing cash flow problems and in 1998
underwent a restructuring program that included a new senior management
team and a new board of directors.
The
board made an unsuccessful attempt to secure a strategic partner or a
merger candidate to resolve the operating difficulties.
Potential buyers were not interested because of the company’s
considerable debt.
As
a result of the Company’s significant liabilities and pending
litigation, the Company considered seeking protection under the United
States Bankruptcy Code, but decided against this because of the
substantial expense.
The
company's management evaluated its options and decided to liquidate under
a General Assignment for the Benefit of Creditors.
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The
Hamer Group accepted the assignment with the intention of selling the
business as a going concern.
In order to preserve the integrity of the
assets and going concern value, it was essential that the assets be sold
immediately, without delay.
Failure to consummate a sale would have
undoubtedly caused a foreclosure by the secured parties and the loss of
value available to pay unsecured creditors.
Prior
to the assignment, we advertised the business assets for sale as a whole
and contacted potential buyers who had earlier expressed an interest.
Subsequently, these buyers submitted bids at auction conducted on behalf
of us as the Assignee.
We
sold all of the assignment estate's interest in the assets of the company,
including furniture, fixtures and equipment, accounts receivable,
contracts, trademarks, patents, as well as other tangible and intangible
assets to the successful buyer.
Finally
we were able to include overseas assets as part of the purchase which was
a deal maker for the successful buyer.
From
start to finish this process took less than two weeks.
This
kind of situation has proven to be of considerable interest to investors,
and in particular to Investment Bankers.
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