Ross and Steve went to the meeting with the independent evaluator about the companies that Fish wanted to buy.,
Before any discussion with Fish, the evaluator met privately with Steve and Ross.
"Both of these companies are worth about one hundred million each, by my estimation. Any estimate over a quarter of a billion total, is far too steep, and in that case, I would pass on it, and walk away. Now to the particulars. One of these companies is clear, no debt, excellent reserves, and in that case, you could even throw out my first number of one hundred and go as high as one fifty. Its the second company that is a problem. Questionable reserves, possible bank debt, old investors from years ago that could pop up anywhere and demand money or sue all of you at any time. That one is a definite pass" The evaluator said.
Ross sighed. "Fine. Being that this is your profession. RFS is retaining you to advise these decisions for us. Please do us a favor. Call Mister Fish with both Steve and I sitting here. If you get him, we will all get on a conference call, and you tell him exactly what you told us. Hopefully, he will quickly agree. You will tell us exactly what price to offer, and what the ceiling to go is. Then, we will call the people who now own this company, offer that price, tell them just what you said, and that we want one company, and are firmly passing on the second one. If they agree, fine. If not, then we have no choice but to walk away. I have been buying and selling enough companies in my twenty five years in the marketing business, to know not to buy a company with a situation like the one you described" Ross said.
"Fine with me. Let;s call Fish" The evaluator said.
The man called Fish's cell phone and John answered.
"John? I have Ross and Steve here with me. I examined the companies you guys gave me from top to bottom. I have one piece of good news and one piece of bad news. One of the companies is a solid buy. You guys could offer anywhere from one hundred mil to even up to one hundred fifty, and the deal would make sense. The other one, I would have to pass on. That second company has questionable energy reserves, possible significant bank debt, and old investors from years ago who might pop up and say they are owed money, which would make it time consuming, impossible, and maybe even dangerous to put together deals with your investors on these reserves,. Thus, we have to call this guy, tell him that I, the independent evaluator advised you to do this, and that you are offering X Dollars on one but are passing on the other,. If it a question of price negation of a certain amount on the company I advised you to buy, then fine, go right ahead,. If he insists it is a package deal, or wont be reasonable, then I would strongly advise you guys to pass. RFS is in too solid of a position between your reserves, investors, and cash flow, to risk it on something like this" The evaluator said.
"Okay. I will go along with that. Such is what we retained you for., Tell you what. Why dont you guys call him while Ross and Steve are sitting with you. Make him an offer, and I verbally say that I authorize you to make said offer. Steve, I and Ross will talk to Fritz, and I'm sure that when the situation is explained to him, he would agree. We have years of business and personal trust between all of us, that he will understand why you told us to do this" John said.
"Great. Thanks. We will get the guy on the phone, and then get back to you" The evaluator said.
The Evaluator then called Tom, the man involved with the company.
"Tom, this is Patrick. I am the evaluator who represents RFS Energy and the men who own said company. They retained me to examine the deal you offered them. The way I see it, one of the companies is a definite buy, and they are prepared to make you a firm but somewhat negotiable offer during this phone call. Both I and the partners of RFS have concern about the second company you are offering, as I see bank debt, questionable reserves, and possible claims by old investors if you try to turn this company over to RFS through sale. I do not want my clients to be left exposed in any way. I hope that you can understand their position and why I am saying this to them" Patrick said.
Tom sighed. "I was really hoping to do this as a package deal. Are you saying that if I drop my price some for the package, that they cannot work with both myself and the bank to negotiate a lower payoff deal?" Tom said.
Patrick sighed. "I cannot answer that question until I see in writing what both you and those who are owed debt would propose. I will tell you what. Please FEDEX a complete proposal to my office. I will look it over, give it to the partners of RFS, we will discuss it amongst ourselves, and then get back to you"
Tom sighed again. "If that is the best you can do, I will go along for now. Let's see if we can work something out"
Patrick got off with Tom and called TJohn back.
"I called the guy, John. He seemed to be hedging. Let me prepare a proposal on your behalf, email it to you, Ross and Steve. If you guys approve it, I will give it to him, and then see. We will not be able to solve this during Ross's trip down here. My suggestion, let Steve and Ross do their show, and let the process play out. I'm thinking that this will take 15 to 30 days"
"That's okay. This is too damn important and risking too much money to screw it up. This is not some ten to twenty five million dollar deal. I would rather get it right, or not do it at all, then rush it" John said.
"Agreed" Both Ross and Steve said.
They got off the conference call.
"Guys, go about your business. Let me deal with this, and then we will talk again" Patrick said,.
"Okay, do your thing,. We will stay in touch" Ross said, as Ross walked out of the office with Steve.
Ross and Steve felt a sour feeling as they left Patrick's office.
"Well that sucks. Tell you what. We know that neither one of us are prepared to do a routine show with investors. Sleep over tnight, go home tomorrow to your other charade, and then we will deal with this and do a bigger show in a few weeks. I never like to cancel or postpone a show due to any other reason but partner illness, but this may be an exception" Steve said.
"Understood, and agreed" Ross said.
Ross and Steve went out to dinner, and then Ross called Kayley.
"I'm coming home in the morning. I might go into the office for a few hours if I get out of here early. The "Big Deal" might either be greatly scaled down,, or not happen at all. The evaluator found out about unknown bank debt, and possible old claims or even lawsuits by investors. We offered a safer, scaled down deal for RFS but the guy balked. Neither Steve nor I are in the mood for a routine deal, so I am going to come home. Better to be with you, then cry in my beer, and fuck things up here" Ross said.
"Sorry, Ross, but maybe this can be worked out. You guys have won so often on RFS, maybe this was just the law of averages of something not working out. Maybe something will work out, just wait and see" Kayley said.
"Thanks. See you tomorrow by early evening" Ross said.
"Okay, try to rest, Sweet Dreams" Kayley said.
"You too, teacher" Ross said.
Ross had restless sleep that night. He checked out of the hotel, went to the airport, and his 7 am flight from OKC changed in Dallas and landed at JFK at 1 pm NY Time.
Ross went to RossShell, and when he got there, another "Anvil" of problems hit him, of, as an old cartoon might show, a weight of about a ton or 2000 pounds.
What was this "Anvil?"
How would it affect Ross and or RossShell after what was likely Ross's most negative trip to OKC ever?
That would be seen.
Before any discussion with Fish, the evaluator met privately with Steve and Ross.
"Both of these companies are worth about one hundred million each, by my estimation. Any estimate over a quarter of a billion total, is far too steep, and in that case, I would pass on it, and walk away. Now to the particulars. One of these companies is clear, no debt, excellent reserves, and in that case, you could even throw out my first number of one hundred and go as high as one fifty. Its the second company that is a problem. Questionable reserves, possible bank debt, old investors from years ago that could pop up anywhere and demand money or sue all of you at any time. That one is a definite pass" The evaluator said.
Ross sighed. "Fine. Being that this is your profession. RFS is retaining you to advise these decisions for us. Please do us a favor. Call Mister Fish with both Steve and I sitting here. If you get him, we will all get on a conference call, and you tell him exactly what you told us. Hopefully, he will quickly agree. You will tell us exactly what price to offer, and what the ceiling to go is. Then, we will call the people who now own this company, offer that price, tell them just what you said, and that we want one company, and are firmly passing on the second one. If they agree, fine. If not, then we have no choice but to walk away. I have been buying and selling enough companies in my twenty five years in the marketing business, to know not to buy a company with a situation like the one you described" Ross said.
"Fine with me. Let;s call Fish" The evaluator said.
The man called Fish's cell phone and John answered.
"John? I have Ross and Steve here with me. I examined the companies you guys gave me from top to bottom. I have one piece of good news and one piece of bad news. One of the companies is a solid buy. You guys could offer anywhere from one hundred mil to even up to one hundred fifty, and the deal would make sense. The other one, I would have to pass on. That second company has questionable energy reserves, possible significant bank debt, and old investors from years ago who might pop up and say they are owed money, which would make it time consuming, impossible, and maybe even dangerous to put together deals with your investors on these reserves,. Thus, we have to call this guy, tell him that I, the independent evaluator advised you to do this, and that you are offering X Dollars on one but are passing on the other,. If it a question of price negation of a certain amount on the company I advised you to buy, then fine, go right ahead,. If he insists it is a package deal, or wont be reasonable, then I would strongly advise you guys to pass. RFS is in too solid of a position between your reserves, investors, and cash flow, to risk it on something like this" The evaluator said.
"Okay. I will go along with that. Such is what we retained you for., Tell you what. Why dont you guys call him while Ross and Steve are sitting with you. Make him an offer, and I verbally say that I authorize you to make said offer. Steve, I and Ross will talk to Fritz, and I'm sure that when the situation is explained to him, he would agree. We have years of business and personal trust between all of us, that he will understand why you told us to do this" John said.
"Great. Thanks. We will get the guy on the phone, and then get back to you" The evaluator said.
The Evaluator then called Tom, the man involved with the company.
"Tom, this is Patrick. I am the evaluator who represents RFS Energy and the men who own said company. They retained me to examine the deal you offered them. The way I see it, one of the companies is a definite buy, and they are prepared to make you a firm but somewhat negotiable offer during this phone call. Both I and the partners of RFS have concern about the second company you are offering, as I see bank debt, questionable reserves, and possible claims by old investors if you try to turn this company over to RFS through sale. I do not want my clients to be left exposed in any way. I hope that you can understand their position and why I am saying this to them" Patrick said.
Tom sighed. "I was really hoping to do this as a package deal. Are you saying that if I drop my price some for the package, that they cannot work with both myself and the bank to negotiate a lower payoff deal?" Tom said.
Patrick sighed. "I cannot answer that question until I see in writing what both you and those who are owed debt would propose. I will tell you what. Please FEDEX a complete proposal to my office. I will look it over, give it to the partners of RFS, we will discuss it amongst ourselves, and then get back to you"
Tom sighed again. "If that is the best you can do, I will go along for now. Let's see if we can work something out"
Patrick got off with Tom and called TJohn back.
"I called the guy, John. He seemed to be hedging. Let me prepare a proposal on your behalf, email it to you, Ross and Steve. If you guys approve it, I will give it to him, and then see. We will not be able to solve this during Ross's trip down here. My suggestion, let Steve and Ross do their show, and let the process play out. I'm thinking that this will take 15 to 30 days"
"That's okay. This is too damn important and risking too much money to screw it up. This is not some ten to twenty five million dollar deal. I would rather get it right, or not do it at all, then rush it" John said.
"Agreed" Both Ross and Steve said.
They got off the conference call.
"Guys, go about your business. Let me deal with this, and then we will talk again" Patrick said,.
"Okay, do your thing,. We will stay in touch" Ross said, as Ross walked out of the office with Steve.
Ross and Steve felt a sour feeling as they left Patrick's office.
"Well that sucks. Tell you what. We know that neither one of us are prepared to do a routine show with investors. Sleep over tnight, go home tomorrow to your other charade, and then we will deal with this and do a bigger show in a few weeks. I never like to cancel or postpone a show due to any other reason but partner illness, but this may be an exception" Steve said.
"Understood, and agreed" Ross said.
Ross and Steve went out to dinner, and then Ross called Kayley.
"I'm coming home in the morning. I might go into the office for a few hours if I get out of here early. The "Big Deal" might either be greatly scaled down,, or not happen at all. The evaluator found out about unknown bank debt, and possible old claims or even lawsuits by investors. We offered a safer, scaled down deal for RFS but the guy balked. Neither Steve nor I are in the mood for a routine deal, so I am going to come home. Better to be with you, then cry in my beer, and fuck things up here" Ross said.
"Sorry, Ross, but maybe this can be worked out. You guys have won so often on RFS, maybe this was just the law of averages of something not working out. Maybe something will work out, just wait and see" Kayley said.
"Thanks. See you tomorrow by early evening" Ross said.
"Okay, try to rest, Sweet Dreams" Kayley said.
"You too, teacher" Ross said.
Ross had restless sleep that night. He checked out of the hotel, went to the airport, and his 7 am flight from OKC changed in Dallas and landed at JFK at 1 pm NY Time.
Ross went to RossShell, and when he got there, another "Anvil" of problems hit him, of, as an old cartoon might show, a weight of about a ton or 2000 pounds.
What was this "Anvil?"
How would it affect Ross and or RossShell after what was likely Ross's most negative trip to OKC ever?
That would be seen.
