saving familiesPlease take the time to read through our case studies below. The following are REAL EXAMPLES of client cases that we have successfully resolved for our clients along with a link to the actual acceptance letters from the creditors. Please take the time to read these success stories and SEE THE ACTUAL ACCEPTANCE LETTERS so you will understand the results we can bring you.

Additionally, you should take the time to read the ebook below, Saving Families One Business at a Time, Tales From the Front Line. This is a compilation of some of our best case studies. We had these successful clients interviewed so you can gain some greater insights into our process and see what kind of results we can bring you.

 

 

 

 

Construction Company With Real Estate

This construction supply company in Virginia experienced huge growth during the housing boom through 2006. The company was in a small rented warehouse space and they decided to take out a million dollar SBA 7a loan for expansion and to buy a commercial property to grow into. Almost immediately after moving to the new facility, the housing market crashed and their revenues started declining rapidly. After the individual business owners depleted all their business assets to keep the business alive and the loans current, they defaulted and sought the advice of Second Wind a few years after the crash.

We engaged their individual creditors and worked out a forbearance agreement that allowed the business to continue operating without any payments while we sought a purchaser for the commercial real estate. The cash flow of the business was immediately improved and we took the time to identify a buyer for the real estate and work on an exit strategy.

When a buyer was found, we worked with all the creditors to accept the sale and release the borrowers from all deficiencies owed while also finding a new location to move the business to. The company relocated to a more affordable location, the borrowers sold their underwater real estate and we negotiated a release of their personal guarantees for a fraction of what is owed.

At this time the borrowers are continuing to operate the business and are free from their SBA loan deficiency.

Total Outstanding Debt: $879,745.57
Payoff of Personal Guaranty: ($100,000)
Total Debt Forgiveness: $779,745.57

Debt Settlement Percentage: 11.4%

Release and Settlement Agreement

IT Managed Services Firm

This client had run a successful IT services firm in Colorado for nearly 17 years, beginning first as a small computer hardware vendor, and intelligently expanding into the cloud based services sector as the technology became accessible. During this period of profitability, the company received SBA financing to expand their operations – $900,000 in total debt. The timing couldn’t have been worse, as the recession hit this firm hard in 2008, and they lost some major clients that reduced their gross revenue to the tune of several million dollars. This company had demonstrated its ability to succeed, but factors outside their control contributed to their decline.

This firm had received a three month deferment from their SBA lender, and while that did provide some short term cash flow relief, after the deferment period, the losses continued to build. The company defaulted on its secured debt obligations shortly thereafter. The firm hired Second Wind and we quickly put a plan in place.

We were able to successfully negotiate a complete restructuring the business, providing a significant recovery value for the bank, whom would otherwise not be able to collect on this type of collateral (IT contracts & accounts). Following the restructuring, the lender worked with the borrower in facilitating a personal guarantee settlement that made sense for both parties – a number not too high to force a bankruptcy (which would make the bank lose out on the opportunity to recover this amount), while still providing a fair recovery value for the lender.

Total Outstanding Debt: $585,000
Sale of Assets: ($60,000)
Payoff of Personal Guaranty: ($50,000)
Total Debt Forgiveness: $475,000

Debt Settlement Percentage: 9.5%

Acceptance Letter

Family Owned Restaurant

This client purchased a pizza restaurant with 2 locations in New Hampshire in early 2008 with a $1.35MM SBA loan. Business revenues never came close to hitting projections and the business struggled to stay current on debt service. By early 2012 the business was in default on the SBA loan in addition to multiple other secured and unsecured creditors.

In addition to the client’s personal guarantee, the SBA also had a lien on commercial real estate and a separate business that was also owned by the guarantor. The client was at risk of losing everything. Second Wind worked with the SBA lender to structure a deal that sold the restaurant into a new operating entity, liquidated the commercial Real Estate, and settle with the remaining secured creditors. The resulting deficiency balance of roughly $600,000 owed to the SBA by our client as well as his other business were settled for $25,000 – 4% of the outstanding debt.

Total Outstanding Debt: $1,200,000
Sale of Assets: ($600,000)
Payoff of Personal Guaranty: ($25,000)
Total Debt Forgiveness: $575,000

Debt Settlement Percentage: 4.3%

SBA Acceptance Letter

Commercial Glass Repair Company

This client purchased a commercial glass repair company based out of Colorado in 2008, just before the economic downturn. Shortly after the purchase was completed, the business revenue began to drop steadily. Within months the business was unable to service its debt. The client came to us with over $1 Million in SBA debt along with several other unsecured creditors.

Additionally, the client owned had financed the purchase of the commercial space in which he operated the business. There was a separate SBA loan secured to that building. If the Glass repair business vacated, he would eventually default on the building payments and could lose the building to foreclosure as well, which would result in more shortfall liability.

Instead, we were able to work with the SBA lender on the business and sell the assets to a new operating entity for approximately $50,000. This transaction not only saved many jobs but also created a solvent tenant for the commercial real estate. This allowed the SBA to not foreclose on the commercial real estate because the rent payments provided by the new tenant were sufficient to cover the mortgage payments.

The client was able to maintain ownership of the building, save dozens of jobs for his employees, and was able to settle his personal obligations for 10 cents on the dollar. The bank received adequate consideration for the business assets, received its SBA guaranty, and was able to avoid the unwinding and liquidation of the commercial real estate loan.

Total Outstanding Debt: $1,060,000
Sale of Assets: ($50,000)
Payoff of Personal Guaranty: ($105,000)
Total Debt Forgiveness: $905,000

Debt Settlement Percentage: 10.4%

Settlement Agreement

Banquet Center with Real Estate

This client purchased an entire strip mall and parking lot in 2006 with SBA guaranteed funds and obtained a second loan to renovate the space and create a banquet center in the location. The strip mall would contain a bridal shop and a photo studio. By 2009 the photo studio had left and the bridal shop was significantly behind on their rent and facing eviction. The loan was not manageable by a single business entity and so both the banquet center and the real estate holding company both went into immediate default. The client’s came to us with just under two million dollars in debt and a closed entity and vacant strip mall.

In addition to the secured creditor issues, the clients were facing litigation from many unhappy customers, vendors and other personal debts related to the closing of the business.

Second Wind was able to communicate with the angered customers from the banquet center and worked out a very affordable discounted rate at a different banquet center in the area. We then worked out a settlement with the SBA guaranteed lender and divided the settlement amount between both loans.

This solution avoided any legal threat the clients would have faced from unhappy customers they could not repay and allowed the clients to move on with their lives without being forced into bankruptcy

Total Outstanding Debt: $1,959,109
Payoff of Personal Guaranty: ($100,000)
Total Debt Forgiveness: $1,859,109

Debt Settlement Percentage: 5.1%

Franchise Restaurant

This once successful pizza franchise restaurant, experienced significant declines in revenue. As revenues continued to drop, the business was not able to meet its basic operational overhead and the guarantor realized a successful exit strategy that involved a settlement of his personal guaranty was the only viable plan. With cooperation with the SBA lender, who was owed in excess of $510,000, we were able to sell the business to another franchisee, protect the client’s remaining assets, and then settle the personal guaranty for 5 cents on the dollar owed.

Total Outstanding Debt: $510,000
Payoff of Personal Guaranty: ($25,000)
Total Debt Forgiveness: $485,000

Debt Settlement Percentage: 4.9%

Approval Letter

Settlement of Personal Guarantee

This Second Wind client was an excellent example of why we refuse to turn anyone away. We agreed to represent this woman despite her lack of ability to pay because it is our mission and our obligation.

The client is a housewife whose husband is overseas in the United States Air Force* deployed within high threat areas. This client noticed a lack of proper, healthy food options in her area and obtained SBA financing to open a small locally grown, organic produce and meat market. Though the demand was enthusiastic in her area, unforeseen costs such as a fire, repeated theft at gunpoint and other damage cut into the working capital and the eventual economic downturn forced her to default on her debts. Despite the obvious danger and lack of funding, the client worked without staff seven days a week from 6am to 8pm to try and recoup the lost capital and regain her solvency.

Her body failed to support the ambitious plan and broke down. Repeated collapse forced her to close her doors as the final time, her customer emptied the cash register rather than calling an ambulance. She contacted her bank immediately and attempted to work out a solution to her default status despite having no business to fund such a plan. She was rebuffed and ignored for more than a year. Her first communication back despite her constant attempts, was a letter from the SBA telling her that her loan was about to be moved into collection by the United States treasury due to, “Your lack of communication in regards to loan number XXXXXXX.”

*The policy of Second Wind Consultants is to offer our complete corporate services to active duty military personnel, pro-bono.

Thinking bankruptcy was the best option, this client contacted several lawyers, but after due diligence was completed, she was aghast to discover her filing of a bankruptcy would also require her husband to file due to the way her loans were secured, and the result of the bankruptcy would strip her husband of his clearance and cause him to be expelled from the position he had in the military.

At this time, the stress of the situation caused a break in her already weakened physical state and she began to lose weight and sleep. Her doctors were unable to solve the issue for months and she was hospitalized and fed intravenously and given medication to force sleep until less extreme methods began to take effect. She was diagnosed with an immune disorder similar to lupus. In addition, she was also diagnosed with adrenal failure and a joint disorder similar to chronic arthritis.

During her recovery stay, the client found our number and contacted us to see if there was any chance we could help her. She worked with Adam Gleason of Second Wind Consultants, and completed an Offer in Compromise package within thirty days of signing on as a client. The SBA accepted an offer of $15,000.00 in payments to absolve the approximately $100,000.00 debt one month to the day after submission of her original package. We are proud that we were able to help these people through their troubling debt situation.

Total Outstanding Debt: $101,248
Payoff of Personal Guaranty: ($15,000)
Total Debt Forgiveness: $86,248

Debt Settlement Percentage: 14.8%

Acceptance Letter From SBA

Retail Computer Business

This retail computer hardware business was purchased using a $1.5MM SBA loan. In the first several months of operating the business, sales did not match financial projections, and the downturn in the economy led to increasing difficulty and eventual inability to support their monthly debt service. They floundered for several years, liquidating all personal funds in order to keep the business alive. Shortly after injecting everything they had into the business, the owners came to us because they wanted out of the business but were still facing over $1MM in personally guaranteed debt to the SBA. We wound down the company and negotiated with all creditors to settle the owner’s personal guarantees.

Total Outstanding Debt: $1,073,000
Payoff of Personal Guaranty: ($20,000)
Total Debt Forgiveness: $1,053,000

Debt Settlement Percentage: 1.9%

SBA Acceptance Letter

Telecommunications and Network Company

A once profitable telecommunication and network solutions business in Texas experienced significant declines in revenue beginning around the start of the recession, as construction and spending significantly slowed. Being a new project based company, it was extremely sensitive to economic decline and therefore found itself in a position where it could no longer support it’s SBA debt. We reorganized this organization and successfully stripped over 1.5 million dollars in debt without interruption of the business. Further, the personal guaranty of the owner was settled for less than 3% of the outstanding balance owed to the SBA.

Total Outstanding Debt: $1,758,337
Sale of Assets: ($188,000)
Payoff of Personal Guaranty: ($50,000)
Total Debt Forgiveness: $1,520,334

Debt Settlement Percentage: 3.2%

SBA Acceptance Letter

Heavy Equipment Dealer

The client purchased his business from the previous owner. After settling into the business he noticed major discrepancies in the revenue produced when held against the projections used in the business sale. The client tried many different ways of increasing his sales, but the revenue never came close to the projected amount and so he could not meet the loan payments associated with the purchase from the business profits. When the client began operating the business there was an average of $230,000 in sales. That number dropped to $85,000 in just four years, indicating a 60% decline in the Florida market. Different factors such as the many businesses around him and the advertising in publications brought all of his business in. Through the course of ownership the magazines changed to a limited exposure online format and the dealerships, which brought his foot traffic in all closed, leaving the business surrounded by vacant lots. Second Wind Consultants was brought in to assist in the reorganization of this business. We provided guidance and strategy and were able the turn the company profitable. In addition we removed hundreds of thousands of dollars of debt.

Total Outstanding Debt: $849,438
Payoff of Personal Guaranty: ($25,000)
Total Debt Forgiveness: $804,938

Debt Settlement Percentage: 2.9%

Acceptance Letter

Veterinary Clinic

This Veterinary business was around for many years and experienced growth and success through the recession. The owners secured an SBA 504 loan and built a state of the art clinic to facilitate their growth. After moving into the facility, they experienced a few years of growth before revenues began declining. Shortly after the decline began, the owners came to us because they were several months in default with their lender and facing foreclosure on the real estate. We reorganized this professional corporation and in the process stripped off hundreds of thousands of dollars in debt without any interruption in business and settled the owners personal guarantees associated with the debt. The real estate property was sold and the business operated under a lease agreement, which greatly improved their cash flow.

Total Outstanding Debt: $1,392,140
Sale of Assets: ($608,000)
Payoff of Personal Guaranty: ($24,000)
Total Debt Forgiveness: $760,140

Debt Settlement Percentage: 3.1%

Bank Acceptance Letter

Gas Station Repair Business

This gas pump repair and installation business ran profitably for years. However, the economic downturn caused by the recession in combination with the completion of upgrades to all gas pumps within the state caused the business to come to a screeching halt. The economic downturn resulted in very few new gas stations opening and needing new product. The fact that the state mandated that all gas pumps be upgraded recently meant that very little repair was needed. The guarantor, left without his business, was now facing a $350,000 shortfall on a business loan and $485,000 shortfall on real estate loan. We wound down the business, liquidated the assets, and settled two SBA loans, one as a term payment with no interest, removing all personal guaranties of the client.

Total Outstanding Debt: $850,775
Payoff of Personal Guaranty: ($39,000), $15,000 lump sum, $24,000 paid over time.
Total Debt Forgiveness: $811,775

Debt Settlement Percentage: 4.6%

SBA Acceptance Letter

Printing & Advertising Company

This printing and promotional business in Southwest Florida experienced decades of healthy profit until the great recession started, when Florida’s economic meltdown began and businesses were closing faster than they were opening. It quickly became apparent that without drastic measures, this business’ secured SBA lender would forcibly wipe them out. We successfully managed to strip hundreds of thousands of debt off and preserve the underlying business opportunity.

Total Outstanding Debt: $300,000
Payoff of Personal Guaranty: ($14,600)
Total Debt Forgiveness: $275,400

Debt Settlement Percentage: 4.8%

SBA Acceptance Letter

Advertising & Promotional Goods Company

This custom embroidering company took a hard hit during the great recession. Cuts were made across the board, including the laying off of staff, moving to a smaller location, and the slashing of salaries. Still, the debt payments were crushing and it was only a matter of time before the business entered default with its secured creditor. Second Wind was able to successfully negotiate a buyout of the assets, which preserved the business opportunity and prevented the additional loss of several jobs. In addition, the former owner’s personal guarantee was settled for pennies on the dollar.

Total Outstanding Debt: $290,000
Sale of Assets: ($10,000)
Payoff of Personal Guaranty: ($10,000)
Total Debt Forgiveness: $270,000

Debt Settlement Percentage: 3.6%

Wells Fargo Acceptance Letter

Art Dealer

In the beginning of the new year, the client noticed his revenue was lower than in previous years. He believed this to be a temporary occurrence and chose to move forward with developing his business. He did this by opening a second remote gallery. With two galleries open, the inventory moved at a significantly faster pace than anticipated and the business began to be overwhelmed. The client ran his businesses by buying large purchases of art through lines of credit and then selling the artwork to generate a profit and to pay back on the lines of credit. Shortly into the following year the lines he operated his business with were cut back or cut off. This led to a spiraling downward trend and eventually led to Second Wind Consultants being engaged. We saved the galleries and worked out the client’s personal obligations. The client came to us with over 750,000 dollars in credit debt beyond the SBA obligation of which, most were worked out for 20-25% or lower. The SBA debt was discharged and the client resumed his business without the massive overhang of debt that was crushing him.

Settlement Letter

Concrete & Masonry Business

This concrete and masonry business in Southwest Florida was purchased at the height of the housing boom. The new owner operated the business through several years and experienced very little success before the bottom fell out of the housing market and new constructions. He continued injecting hundreds of thousands of dollars in personal funds to keep the business afloat while taking a minimal paycheck. As the competition died around him we were able to reorganize the business, sell of underutilized assets and strip off $1,101,667 in debt from the business. We later settled the personal guarantee of the owner for a minimal amount and also helped him facilitate a short-sale of his personal residence which he also walked away from without any deficiency balance.

Total Outstanding Debt: $1,101,667
Sale of Assets: ($96,000)
Payoff of Personal Guaranty: ($15,000)
Total Debt Forgiveness: $270,000

Debt Settlement Percentage: 1.5%

UPS Capital Acceptance Letter