Case Studies—Service Industry

Human Services Agency

NHB Advisors, Inc. was engaged by a non-profit agency that houses, trains and employs handicapped adults. New management had been engaged a year earlier to restore financial stability and develop a more viable business model. However, the lender did not want to continue its support. The NHB case team created a detailed financial model, cash flow projection and written report which clearly explained the cash flow dynamics of the client. NHB also evaluated the capability of the management team and was able to provide it with a strong endorsement. As a result, the lender decided to support the client, increased its loan facilities by 20% and lowered the interest rate by 3%.

East Coast Staffing Company

Harvey Nachman led a case team tasked to stabilize a leading East Coast office-staffing and permanent recruiting firm that had been adversely affected by the events of September 11th, and had failed to reduce its operating expenses, particularly those connected with owner compensation. In addition to being in default of loan agreements with its secured lender, employee and employer federal and state withholding taxes were seriously in arrears. When the shareholders declined to fund a turnaround alternative formulated by NHB, a sale of the business was successfully pursued by NHB that has the potential of repaying the lender and shareholder tax obligations in full through an ongoing royalty stream.