by Arthur Rawl
“Those shops aren’t voodoo places. They are native herbal medicine shops selling traditional cures from the Amazon jungles. We’ve seen the same sort of thing in Capetown and Nairobi. It’s your imagination.”
“They were just as strange in Africa. It’s not just my imagination and the shops look a lot more prosperous here.”
“Robin, your problem is you’re over educated. That Doctor of Business Administration degree turned your mind away from the probable, past the possible into the preposterous. You see what’s not there with greater clarity than most people see the ground under their feet and in a deal, thankfully, you miss nothing.”
Theatrically, with the back of her hand pressed against her forehead, “For a minute there I thought I wasted all those tuition payments.”
“On my first day here I met you and Skip at one of the beef rotisserie restaurants that’s just down the road from here. You want to go there for an early lunch? I skipped breakfast this morning and I’m hungry.”
“Ah yes Baby Beef Rubiyat, you want to return to the scene of the crime.”
“No I want to have a good lunch and their meat was the best I’ve had in this city known for its beef.”
“My troops are supposed to land about two this afternoon. I gave reception their names already so as long as we don’t eat too slowly or too much I’d love to. Let me get this phone call … its Juan Batista for you.”
“Hello Juan, sorry we couldn’t spend more time together last night. The ladies kept me busy and then our host.”
“I would not have been as good company. We had been reviewing the draft of the post-closing financials with our accountants all day. That’s why I’m calling.”
“I assume you found something that may require an adjustment and there will be a delay.”
“Yes and no. You will get the financial statements tomorrow and they will reflect a significant adjustment for the sale of several parcels of land that wasn’t supposed to close for another two to three weeks. The proceeds from the sale were paid into the Federal treasury and will not be transferred to BrasTel because the Government says the company has been sold.”
“That seems like a straight forward enough adjustment. What am I missing?”
“The sale took place the day before BrasTel’s closing and funded the day after BrasTel’s closing. The book carry value of the parcels of land on BrasTel’s books was the equivalent of six and a half million US and the selling price at the same exchange rate was a little over twelve million US. The Public Utilities Commission has decided the BrasTel buyer is entitled to a credit of six and a half million. I have been asked to inform the buyer and ask for his comments if any.”
“It will be interesting to see how your auditors deal with it as well as how your attorney’s post-closing opinion letter treats the matter. I’ll call Dieter as soon as we hang up. I know what I’ll recommend but I think he is entitled to receive the recommendation first so I’ll wait with a response.”
“Management felt that would be the case.”
“I won’t ask how management felt about the commission’s position. But, I will tell you we had a long session with our auditors yesterday afternoon and all I can say is the accounting treatment remains under discussion.”
“I hope you are keeping your stakeholders informed. They might be helpful in sorting this out before my client really has to seriously consider it.”
“Please try to let me know how your client reacts as soon as possible. Management is focused on getting the post-closing financials issued on time tomorrow and thinks his view will be helpful.”
“I’ll do what I can.”
“That’s all we can ask. I look forward to talking to you soon.”
“Take care Juan.”
Not surprisingly Robin was standing in the doorway when I turned back to my desk. “From the side of the conversation I heard it sounds like lunch just fell off the schedule.”
“No, I think a good lunch is first in line. I’ll give you the details of the call while we are eating. I know what I’m going to recommend to Dieter and what he is going to say so there is no reason to miss lunch.”
“What happened to my compulsive colleague? I didn’t think you ever heard of a back burner. What’s new?”
“Alright you caught me. I think there’s more to what’s going on than what Juan said or may know. I want to think about it to be sure when we talk you’ll get my best guess about what’s going on so we can discuss strategy.”
“… and you’re going to make me wait so I can shoot from the hip.”
“Yes, but not very long. I’ve learned your quick first shot always ends up the best as long as you get a decent picture of what’s going on. We’ll leave in a few minutes but first try to reach Dieter and ask him if he can be here at three o’clock this afternoon. Tell him we have something important and need his guidance.”
“Do you want Alana here at three?”
“Not really. Let Dieter fill her in later. It will put a little distance between us and the real action and maybe create a little protection for you and I.”
Twenty minutes later Jóse Carlos was backing across the narrow sidewalk in front of the restaurant into one of the few spaces left under the trees shading the entry from the blazing midday sun. We were early so I didn’t make a reservation. That and I requested a quiet place in the back against the wall when most patrons wanted to be in the middle of the action assured us a table.
The tall blonde hostess in a too tight simple black dress led us to a corner table in the back of the room and with a smile asked us whether it was acceptable.
“The table is fine. Please ask the waiter to give us a few minutes.”
“Certainly Senhor.”
Robin watched her slowly walk back to the reception desk with her hips in full motion, “I bet she’s on the menu.”
“I wouldn’t be surprised if she had an after-hours client list. There aren’t many well-paying jobs for under-educated women and there’s a lot of Brazilian men willing to pay to have their fantasies come true.”
“… and they flock to the big city looking for a rich husband because they’ve been told how beautiful they are from the time they’re born. Same damned story everywhere. Now, what about Juan Batista?”
“You were right, he called about a possible adjustment. BrasTel sold some land the day before we closed.”
“That’s straight forward enough. The land’s sales price in cash replaces the hard asset value and there’s no adjustment necessary.”
“It’s not that simple. The proceeds were paid into the national treasury the day after our transaction closed not into BrasTel under the theory that BrasTel was no longer a government asset and the land was government property.”
“They get the nice try award.”
“Not so fast. Management went to the Public Utilities Commission and made that point. The Commission has taken the position that any possible adjustment should not exceed the carry value of the land before the sale and any profit from the sale remains with the government.”
“Okay, what are the numbers?”
“The carrying value of the land in US Dollars was about six and a half million and the selling price was just over twelve million.”
Robin’s face started working and in a moment, “They’re playing games. They’re setting up a confrontation over nothing. What are they trying to distract us from?”
“Right again Professor, that is precisely the question. The seller’s accountants and lawyers are both required to give post-closing opinion letters to the buyer. There is no question whether the land transaction is of a nature and material enough to require comment on the appropriateness of its treatment at closing from both professional firms. Considering that, the seller is either trying to set up an unnecessary negotiation over a small amount of money or they are trying to distract the buyer from something else. Something that is much more important.”
“So what do we do?”
&nbs
p; “Tell our client and wait to see how he reacts after he talks about it with the General. I think he’ll listen to us and then he will call Alana and they will hurry off to consult.”
“What about asking for a list of the properties sold and check to see what’s on them and whether the selling price makes sense?”
“Normally I would agree with you but with this one I think waiting may tell us enough when we get Dieter’s answer.”
“Okay, I’ll wait only because it’s not our money but I don’t like waiting. The place is filling up with the rich, powerful and noisy so let’s order. Now I’m starved and I don’t want to rush through lunch, not here anyway.”
At five minutes of two we opened the office door to the sound of the phone ringing. Robin grabbed, “Yes, we just got back. I was going to call. Please wait five minutes and have security bring them up. Thank you. Yes, I’ll remember.”
“Were we bad children?”
“He tried to make it sound that way. His whole life seems to be about building security.”
“Think about who owns this space. Maybe his life is on the line.”
“Thanks, I really needed that kind of reminder. I’ll keep it in mind when I’m sorting out what next to do with my life.”
“Well, while you are sorting things out move our money into our personal UK accounts. Leave half a million in our business account and split the rest fifty-fifty between us.”
“I thought the split was to be sixty-forty with you getting the sixty.”
“As they say in the military, consider it combat pay.”
“Thanks again, I really didn’t need ‘that’ reminder. Greet the troops and get them settled in the conference room. I’m going to the girls’ room.”
“I’d like you to be part of the conversation with Dieter so get them started and then come to my office. Remember, Dieter is usually early.”
“Yes boss, I’ll cut my girl’s room time short.”
“That’s the story Dieter. Both Robin and I believe there is more to it. The position being taken doesn’t make any sense. I spoke with our attorney and he says there is nothing in Brazilian law to support what is being proposed.”
Dieter scratched his chin and looked down at his shoes, “Ja, of course you are right. It could be anything else. It makes the post-closing due diligence much more important if it can be done at all.”
“One thought we had was to look at the properties sold to see whether they have buildings on them and then look at the values on the books to see if they are reasonable. Lastly, we can look at the selling prices allocated to each parcel and the amounts the properties are assessed at for real estate tax purposes to see if it all makes sense. Their game may be to have us fight about a selling price that does not have any relationship to the true values.”
“Perhaps, what do you suggest we do next?”
“Call Juan Batista and tell him we have consulted with you. Our position is we first have to understand the details of the properties and their improvements, the selling price, the process through which the selling price was determined and of course the identity of the buyers and, if they are corporate structures, the people behind them before we can consider the seller’s position regarding the accounting for the closing. The post-closing financials will be here tomorrow so we will begin looking for other questionable items of sufficient size to justify this kind of game playing.”
“Good, we will talk after the call please. Now I will go to say hello to Sra. Alana if we are done here.”
“That’s all for the moment. I will call you after I talk to Juan. Should I use Alana’s office number?”
“No, I have been given the use of a cellular phone with a Brazilian number.” Dieter pulled out and turned over a business card, “I will write it here for you.” Then sliding it across the table, “I am sure we will be able to work this out but I will not be turned into Father Christmas by the sellers. If we are due something we will get it. Good afternoon to you both and thank you.”
Robin was on her way to the conference room when I returned. “Let me check on the troops and then I’ll be back. I want to sit in when you call Juan.”
“How much time do you need? I want to call him during normal business hours.”
“Five or ten minutes and then I’ll send them home. They can come back tomorrow morning and I’ll run the usual class for them so they know specifically what we’re looking for and what we want.”
“Okay, I had an email from my lawyer in New York. He wants me to call him today. He sounded a little concerned about something.”
“I hope our deal hasn’t fallen apart.”
“I don’t think so. He said he settled the other damages amount question for an amount equal to fifty percent of the agreed compensation amounts with the additional amount paid as liquidated damages that buy the release of any other claims against Lazer. He said he should have a draft agreement for us to review in another day or two.”
“Sounds good, I like the extra cash. Is he handling anything else for you?”
“No, just Lazer.”
“I’m sure there is a confidentiality clause in the agreements so it can’t be about a book deal.”
“I’ll find out. See you in a few minutes.”
“Hello, it’s Carl Matthews. Is he in?”
“Hello Mr. Matthews. He is here but he’s on the phone. I think he’s finishing up if you can wait.”
“I can wait.”
“Are you still in Brazil? I’d love to go there.”
“Yes, still in São Paulo. Most of the Brazilians I know would love to go to New York.”
“I guess people everywhere want to go somewhere else. I think he just hung up. Hold on please.”
“Hello Carl. I assume I can thank my e-mail for the call.”
“Hello, the weather is fine here in São Paulo. How are you?”
“… ah, fine, yourself.”
“Just wonderful. What can I do for you?”
“I got a call about three hours ago about an invitation for you. It was from an investigator at the SEC office on Foley Square. He wants to talk to you about Lazer.”
“He knows I was fired?”
“He knows and I told him you were still in Brazil but doing nothing for or concerning Lazer.”
“Interesting … What did he sound like?”
“He sounded like he wants to go fishing with you.”
“Was his invitation formal or informal.”
“No subpoena just an informal invitation.”
“When are the Laser agreements going to be ready?”
“I got the final agreements this morning. They have been signed by Lazer’s people and can be executed in counterparts by the two of you.”
“I assume they contain the usual broad confidentiality restrictions.”
“As broad as they come. I’m not sure you can even say the word Lazer using a capital ‘L’.”
“Email the agreements to me once you’ve looked at them. I’ll sign and have Robin sign tomorrow, get them notarized and put them in an overnight express packet to you. Once I’m sure they are on the way out of the country we can have a conversation about the SEC’s kind invitation.”
“I think that works.”
“I’ll call you when they are on their way.”
“Good, I’ll send the agreements by email within a half an hour. The faster I have them in hand the faster you’ll have your money. It’s in their lawyer’s trust account right now and he’ll wire it to my trust account when I deliver your signed copies. I need two copies with original signatures from both of you. When the money arrives I’ll need signed disbursement instructions from you and Robin. Please email your bank wire numbers etcetera to me and I’ll prepare the instruction letter for you. I’ll also send you my final invoice with the instruction letter and the amounts you and Robin get will be shown net of that amount split proportionately according to the amounts of your settlements.”
“I’ll pay your bill so
do not deduct anything from Robin. She was just collateral damage in the grudge match between Sam and I.”
“Whatever you say Carl. I don’t see it that way but you’re the client.”
“Thanks, I’ll make sure things get turned around quickly here. Thanks for everything. We’ll talk after the money moves.”
I turned from the window back to my desk to find Robin standing in the doorway. “How are your troops? Did they come with a brain or two?”
“They’re good, surprisingly so. If you plan to keep an office here, you may want to hire one of them. One has an MBA from Harvard and the other has one from the Kellogg School at Northwestern University in Chicago. Both are fluent in English, French and Spanish.”
“All of that also means they are from the ‘right’ families here in Brazil.”
“What does your lawyer say?”
“The SEC wants to talk to me.”
“That’s your problem, what about my money?”
“It’s in the escrow account of Lazer’s lawyer who will move it into my lawyer’s trust account when he delivers the signed agreements. We’ll have the final contracts by email in about an hour so tell the notary downstairs we will need her services. Also tell her we will need to send documents by overnight international express service before we leave today. Put the wire instructions for my London account on a piece of paper along with the instructions for the account you want your money sent to. We’ll put that in the overnight express delivery and we should get a disbursement instruction letter for signature by email tomorrow that we can return by email. In short in a day or two you’ll have enough money to buy us lunch.”
“Thanks, I’ll call downstairs right away. Oh, by the way, thanks for the charity, I’ll keep it of course.”
“You are very welcome. Let me call Juan Batista back and tell him our client is considering the situation so hurry back.”
I turned to the window. The beautifully tended garden below was the picture of peacefulness but, somehow, I missed the reassuring crowded confusion of Av. Paulista. There I didn’t feel I was being lulled into submission, lulled into a life that was not the one I envisioned with hectic days and weekends as an English country squire. Perhaps the General started the process but now Alana had her firm hand on the helm and was in firm control. Maybe that wasn’t all that bad … or was it. She was clearly the most exciting woman I had ever meet. Smart, beautiful, self-assured and completely without inhibitions. What else could a man ask for? What else could he ever want? Then why am I unsure, why learning who she really is made such a difference.