CCo fiercely protects confidentiality as an important element of establishing lasting relationships. Therefore, the names of our clients have been excluded from these case studies. In effect, these represent the unpublished tombstone ads for some of our most significant accomplishments in select market segments.
Contract Manufacturing
Defense Electronics
Software Development
Mortgage Banking
Aerospace & Defense
Contract Manufacturer
(Cincinnati, Ohio)
Description: Performed precision machining, fabrication and assembly under build-to-print contracts; $30 million annual volume; 200 employees; multiple locations across three states.
Circumstances: This company had been losing modest amounts of money for a number of years and finally reached the point where its primary secured lender demanded personal guarantees of the owner and was threatening to 'call the note' even though there was no payment default. The company's lawyer (Keating, Muething & Klekamp) eventually convinced the owner/CEO of the need for outside assistance; by that time a serious case of lender fatigue had set in.
Results: Reorganized operations and improved internal control systems, restructured $6 million secured loans (Fifth Third), reduced break-even point by over 25% and negotiated new long-term agreement in excess of $70 million with Fortune 100 customer (General Motors); remained on this company's board for a number of years after the transition.
Defense Electronics Firm
(Cincinnati, Ohio)
Description: Manufactured combat tactical radios under prime contracts with DOD customers; $20 million annual volume; 100 employees.
Circumstances: This company had a $20 million deficit as a result of under-bidding a number of fixed-price contracts, and yet was the sole U.S. supplier of critical military hardware. Both the company's CPA (Rippe & Kingston) and government contracts counsel (Jenner & Block) were able to convince the owner of the need to bring in interim leadership for a turnaround campaign that looked to the government for assistance.
Results: Arranged for a $7 million financial relief package with the U.S. Army (CECOM), requiring an extensive government audit, converted $10 million subordinated notes to equity, negotiated a standstill agreement with the company's primary secured creditor (Star Bank), and proposed an $80 million new procurement under a teaming agreement with a large prime defense contractor (Grumman). Company was ultimately forced into bankruptcy involuntarily before it was able to complete performance, as an unfortunate result of an impasse between the owner and interim leadership.
Database Software Developer
(Lafayette, Indiana)
Description: Developed and distributed software and helped develop applications for commercial customers as well as VARs; $25 million annual volume; 200 employees; offices in six states and the U.K.
Circumstances: This company embarked on an aggressive expansion program by borrowing heavily under a short-term line of credit (Indiana National Bank), only to witness a large competitor (Ashton Tate) dominate its niche in the marketplace. Worst of all, there was a dysfunctional leadership structure resulting from the founders' inability to get along with each other.
Results: Arranged the private sale of a majority equity stake and thereafter redirected the business thrust to a new market niche strategy, helped negotiate new software license agreements with large commercial customers (ADP et. al.), reduced fixed overhead costs, negotiated branch office lease terminations, and discontinued unprofitable foreign subsidiary operations; remained on this company's board for two years after transition efforts concluded.
Mortgage Banking and Servicing Group
(San Jose, California)
Description: Originated, sold and serviced residential loans; $100 million annual loan originations; 200 employees; twelve branch offices.
Circumstances: This group had expanded aggressively throughout the Bay Area and was selling fractionalized junior deeds-of-trust. The problem occurred when interest rates rose, defaults skyrocketed, and the ability to service non-performing loans on the books couldn't keep pace.
Results: Negotiated a fresh money loan and restructured an existing warehouse-line with the lead bank (Imperial Bank of California), oversaw servicing of a $70 million residential loan and REO portfolio, and protected creditors' rights and priorities during an informal reorganization effort, in concert with the California Department of Real Estate; remained on this company's board for several years after the transition.
Aerospace and Defense Contractor
(Cincinnati, Ohio)
Description: Manufactured complex systems and sophisticated components under subcontracts with most of the large prime contractors in the aerospace and defense industry (Boeing, GE, Lockheed, General Dynamics, Raytheon, etc.); $50 million annual volume; 250 employees; multiple locations
Circumstances: The transition efforts here involved reviewing the company's basic business model, negotiating several long-term strategic alliances with performance terms & conditions and escalation formulae, and developing an organizational structure that matched a renewed business strategy. This case is not really a turnaround; it illustrates that fresh thinking and employee empowerment can be instrumental at other stages of the business cycle to influence positive outcomes.
Results: Reorganized operations into cross-functional teams, developed strategic planning initiatives, implemented plans using balanced scorecards, arranged $5 million industrial revenue bond financing (Provident Bank) for new construction and growth projects, and helped achieve record backlog and profitability; currently serving on this company's board.