ASSESSMENT ITEM 3 – CASE STUDY
Bruce and Belle are long-time friends: they went to university at the same time and studied a Bachelor of Business & Commerce. Twenty years have passed since graduation, and Bruce’s life has changed a lot. Last year he divorced his wife and six months later he won $10 million in the lotto.
Belle was never married Nor had children – her life was devoted to climbing the corporate ladder. She is the CEO of the Northern Territory’s largest real estate company, Sell-o-rama, but she has been worn into the ground with working 6 days a week, 12 hours a day for a long time.
Bruce meets her for lunch one day and raises the idea of a business venture with her. He suggests that they start up their own real estate agency (Bruce has a real estate licence, and so, incidentally, does Belle – though she does not sell, as such.) Belle resigns her position at Sell-o-rama, well aware that she is not able to use the client lists or any of the information from her ex-employer. Indeed, her contract prevents her from working within the entire Northern Territory as a real-estate agent for a period of 5 years after her resignation.
After working through all of the options available, including possible franchises, they decide to start a brand new business, which has no history or obligations to anyone. They don’t write up a business agreement between themselves, but agree over several coffee meetings that Bruce will put in the “financial capital” ($100,000 to begin with) and Belle will use all her skills and knowledge from her previous job as the “intellectual capital”, as she has no significant assets or cash to invest (Belle spent most of her income on posh holidays and designer clothes.)
Their business is called Pinnacle Real Estate, as they intend to only sell high-end properties. Their slogan is this:
“Pinnacle Real Estate, forget the sell-o-drama, and make the experience of selling your house a dream”.
They use a photo of Belle in all of their advertisements (see the woman holding the folder below). The second photo – of the man – is the one that was (and still is) used by Sell-o-rama in their advertising.
Within the first week they are both selling houses like mad – business is booming! Most of the clients come from the old business, as they received targeted marketing – Belle knew the Facebook pages that were most popular with her previous clients and advertised on those pages.
As soon as the ads of their new business hit the papers, the new CEO of Sell-o-rama – Ivan Torrible – becomes aware of the business. After a few days, he goes to Sell-o-rama’s lawyer and asks for legal advice.
ASSIGNMENT QUESTIONS
Part A:
You are the legal advisor. Please give advice to Mr Torrible on the facts above, identifying all of the possible issues.
Part B:
As the legal advisor, write a letter to Pinnacle Real Estate setting out Mr Torrible’s concerns, and what action/s you intend to take on behalf of Sell-o-rama.
Part C:
Give advice to Pinnacle Real Estate about who is likely to be sued, and whether they have any defences.
Belle Sell-o-rama
The Genesis Energy operations management team is now preparing to implement the operating expansion plan. Previously, the firm’s cash position did not pose a challenge. However, the planned foreign expansion requires Genesis Energy to have a reliable source of funds for both short-term and long-term needs.
One of Genesis Energy’s potential lenders tells the team that in order to be considered as a viable customer, Genesis Energy must prepare and submit a monthly cash budget for the current year and a monthly cash budget for the subsequent year. The lender will review the cash budget and determine whether or not Genesis Energy can meet the loan repayment terms. Genesis Energy’s ability to repay the loan depends not only on sales and expenses but also on how quickly the company can collect payment from customers and how well it manages its supplier terms and other operating expenses. The Genesis Energy team members agreed that being fully prepared with factual data would allow them to maximize their position as well as negotiate favorable financing terms.
The Genesis Energy management team held a brainstorming session to chart a plan of action, which is detailed here.
Since this expansion is critical to Genesis Energy expanding into new overseas markets, the operations management team has been asked to prepare an executive summary with supporting details for Genesis Energy’s senior executives.
Working over a weekend, the management team developed realistic assumptions to construct a working capital budget.
Based on this information, do the following:
Download this Excel spreadsheet to view the company’s cash budget. You will calculate the company’s monthly cash budget for the forthcoming year and quarterly budget for the subsequent year using this information.
Managing Files and the World of Windows”
Are socially responsible companies economically successful? In other words does it pay to be socially be responsible? Why or why not? Provide specific examples from the business environment.
no less than 250 words. Questions and sources are not included in the word count. For your response to the question include at least one source, using Modern Language Association (MLA) or American Psychological Association (APA) format, to support discussion question responses.
Financial Planning and Agency Conflicts” Please respond to the following:
Select a publicly traded corporation for which you would like to work or are currently working.
Research the corporation on its own Website, the public filings on the Securities and Exchange Commission EDGAR database (http://www.sec.gov/edgar.shtml), in the University’s online databases, and any other sources you can find. The annual report will often provide insights that can help address some of these questions.
Write an eight to ten (8-10) page paper in which you:
Your assignment must follow these formatting requirements: