Shell Game (Stand Alone 2) (3 page)

“Hello, Helen. How are you today? Is Mr. Burns treating you well?” This was a standard part of the banter between Edward and Helen. He always told her she could come work for him if she wasn’t being treated well.

“Everything’s fine, Mr. Winter,” the woman said in a monotone, dry voice. “I’ll tell Mr. Burns you’re here.”

Edward was surprised at Helen. She must be having a particularly bad day, he thought. Helen returned a few seconds later.

“You can go in now, Mr. Winter,” she said, an apologetic look on her face.

Edward walked past Helen’s desk into Stanley Burns’ office. Burns stood and greeted him, then ushered him into his usual chair. “Please sit down, Edward,” Burns said, closing the office door and seating himself opposite Edward.

“You look beat, Stan,” Edward said.

Burns shrugged. “The economy’s impacting a lot of our clients.”

Edward passed Burns a financial report his Chief Financial Officer, Nick Scarfatti, had prepared for the second quarter ending June 30. “Thank God our business hasn’t been impacted.” He didn’t want to gloat, especially when so many other businesses were suffering, but Edward was more than pleased with the condition of Winter Enterprises, Inc. “You will see in those reports that our sales are up. We’re requesting an increase in our credit to finance the acquisition of seven new sites and the construction of new restaurant buildings in Pittsburg. We’ve already identified the managers for all seven of those stores. We—”

Burns held up a hand, stopping him. “Before you get too far along with this, I need to tell you there are a lot of changes going on around here. We’re . . . I’m sorry to tell you, we will not be able to finance any more of your sites.”

Edward felt as though he’d been punched in the gut. “What are you talking about? Our financial condition has never been better.”

“We just can’t extend you any more credit. That’s it. Plain and simple.”

Edward tried to calm his anger. “Stan, do I recall correctly that you begged me to move my business to Broad Street National three years ago and told me at that time your bank had a statutory loan limit of $40 million to any one customer? We currently owe you $20 million, secured by at least $50 million worth of real estate. We’ve never been late a day on any of our loan payments, and we keep several million dollars in deposits with you. So what the hell’s going on?”

“It’s a different environment out there, Edward. We can’t do what we used to do. It’s just that simple.”

“You keep saying that, Stan. But it’s not simple. We’ve got a huge growth opportunity here. We’re growing market share as our competition is falling by the wayside, closing locations, or going out of business entirely. There’s never been a market more conducive to growth, and now you’re telling me you don’t want to be our financing partner anymore?” Edward stood and looked down at Burns fiercely. “This is a hell of a shot out of left field, Stan. I’ve already signed purchase agreements, put down forfeitable earnest money deposits on lots in Pittsburgh, and signed employment contracts with the seven store managers based on your past assurances of financing support.” He turned to leave the office when Burns’ tired voice halted him.

“Edward, please sit down. I haven’t told you everything.”

He whipped back around. “What more could there be?”

“The bank’s under a great deal of pressure. The Federal bank regulators ordered us to reduce our exposure to commercial real estate. You’re one of our largest commercial real estate borrowers, so the loan committee has instructed me to reduce our commitment to your company specifically.”

Edward, still standing, glared malevolently at Burns. “You’ve already explained that to me.”

“No. You misunderstand. We want you to pay off all of your loans as soon as possible.”

Edward laughed bitterly. “What are you smoking, Stan? The bank is making a lot of money off my business. You probably don’t have a better client than Winter Enterprises. We’ve got a large amount of equity in the real estate you’ve financed and we pay our bills on time. Is this a joke?”

Burns’ face had turned beet red. “This is no joke. I can’t tell you how badly I feel about this. I’m just following orders.”

“We have a loan commitment from the bank. We signed a master note with a twenty-year maturity on it, backed by all twenty-four of our restaurant properties.”

“That’s true, Edward, but the bank has the right to call that note at the end of each five-year anniversary of the note. The first five-year anniversary is July 29 of this year. We will need you to make other arrangements so you can pay us off entirely by no later than that date.”

“That’s two weeks from now. Impossible.”

“Nevertheless, that’s the way it’s got to be.”

“I want to talk to Sol Levin.”

Burns sighed. “That won’t do you any good.”

“I’ll be the judge of that,” Edward said.

“The regulators ordered our board of directors to terminate Mr. Levin this morning. He’s no longer the president of the bank.”

Edward was as angry as he could remember ever being. He didn’t quite understand the machinations behind the bank’s actions, but he sure as hell understood the implications. Now he had to go through the painful process of establishing another banking relationship in two weeks, putting together a massive loan application package and then schmoozing some new banker who knew nothing of his business and escorting the new banker to some or all twenty-four of his restaurant locations. By the time he reached his dark-blue Corvette parked in the bank parking lot, he’d calmed down enough to plot out a course of action. It would take a lot of time and effort to get together the package, but there had to be at least half a dozen banks in the area big enough to handle Winter Enterprise’s business and which would salivate at the opportunity.

After driving out of downturn and getting on the Schuylkill Expressway back to his office in Mt. Airy, Edward called Nick Scarfatti, his CFO, on his cell phone to ask him to clear his schedule that afternoon.

“What’s up?” Nick asked.

“Broad Street National Bank just dumped us as a client. I’ll explain when I get there.” He paused for a second and added, “You should call Paul Sanders; have him come in about three this afternoon. And you’ll need to start working on a finance package.”

Edward signed off and slammed his palm against the steering wheel, knowing the poor position he’d put Nick in. Nick Scarfatti was scheduled to go to Hawaii at the end of the week for a two-week, well-deserved vacation, but there was no way Nick could be out of the office at this time. “Damn bankers,” he growled, hitting the steering wheel again for good measure.

Edward was back in his office by noon. He called Nick Scarfatti into his office. As usual, Nick looked as though he’d stepped off a page from
Gentlemen’s Quarterly
. His blue pinstriped suit showed no wrinkles, his white shirt was starched, and his red power tie was perfectly knotted. His black wingtip shoes were spit-shined and his hair and mustache were perfectly cut in a conservative style. He was dressed like a stereotypical Wall Street banker. Luckily for Edward and Winter Enterprises, Nick was as conscientious about preparing accurate financial reports as he was fastidious about his personal appearance.

“I hate to do this to you, Nick, but I need you here until we resolve this financing issue.”

“I figured that already,” Nick said with a wry grin. “My wife’s going to kill me.”

“I’m sorry, Nick. We’re on the ropes here. Stan Burns only gave us until the end of this month to pay off our loans at the bank.”

Nick waved a hand. “Annie’ll understand. Eventually. I’ll get started on a presentation for the banks. Which banker are you going to call first?”

“Probably Van Snowden over at Curtis Bank & Trust. He’s been after me for years to take some of our business over there.”

“He’s a good banker, Eddie. I think Curtis Bank & Trust would treat us right.”

Edward shook his head. “I just don’t get it. Broad Street was kissing our butts a couple years ago. Now they, in effect, kicked those same butts out into the street.”

Nick started to leave, but Edward stopped him. “Nick, don’t argue here, but the company’s going to pay for a trip to Hawaii for you and your family. Hopefully soon, right after we get past this hiccup. It’s the least we can do.”

Nick smiled, genuinely this time, at Edward. “That will take some of the heat off me when I talk to Annie. Thanks.” He hesitated a second and then said, “Can I convince you to call Annie and tell her about postponing our trip?”

“I’d sooner go back to Iraq.”

“Chicken.”

Edward laughed. “You got that right. When do you think you’ll have an updated financing package?”

“It’s Wednesday. Make an appointment with Van Snowden for Monday.”

“I’ll do it. Thanks.”

As Nick left the office, Katherine walked in.

“So, what happened at the bank?” she asked as she took a seat on the couch. “Nick told me right after you called him that they want us to pay off our loans.”

“Mom, I don’t have a clue. There’s something really wrong at Broad Street Bank. Burns told me the regulators ordered the directors to fire their president. Sol Levin’s been at the bank for twenty-five or thirty years. Wanting us to move our business can’t have anything to do with us; it’s got to be an internal problem at the bank. Our business is very profitable and we’ve always complied with the requirements of the loan agreement.”

“Maybe Paul will know something; he’s usually got his ear to the ground.”

“He’ll be here this afternoon,” Edward said, nodding.

“I pulled all the bank loan files for him to review,” Katherine said. “Maybe there’s something in there that will give us more time.”

“Good idea,” Edward said, “but don’t count on it. Burns wouldn’t have pulled the plug on us unless he’d done his homework.”

“You seem pretty calm about this.”

“I am really angry at the way Burns treated me. But I’m not worried. With our history and financial position, every bank in the area should be begging us for our business. This is just a little bump in the road, albeit a painful bump.” He grimaced and added, “I had to ask Nick to postpone his vacation.”

“That’s terrible. He’s put off taking a family vacation for three years now. I don’t envy—”

Nick Scarfatti entered the office quickly, without knocking, and turned on the television in the corner. “Sorry to interrupt, but I thought you’d want to see this.”

The screen showed a close up of a reporter holding a microphone. The sign on the building behind her read Broad Street National Bank. “ . . . but, according to a press release issued by the bank’s board of directors, Broad Street National Bank is in excellent financial condition, citing that the termination of Sol Levin, the bank’s long-term president, was due to deterioration in the bank’s commercial real estate loan portfolio. Broad Street is one of Philadelphia’s larger independent financial institutions and one of its largest commercial real estate lenders. We called the local office of the Federal Deposit Insurance Corporation to see if they had anything to add to the bank’s press release, but they declined to comment. As Eye Witness News has reported over the last two years, the Federal Deposit Insurance Corporation has taken over more than two hundred banks in the United States. We will keep our viewers informed of any further developments. This is Linda Reynolds, Eye Witness News.”

Nick turned off the television with the remote and gave Edward an open-armed gesture. “Very strange.”

“There’s more to this than ‘deterioration in the bank’s commercial real estate loan portfolio’,” Katherine offered. “That stupid reporter will probably start a run on the bank as a result of her spurious little statement about the FDIC.”

“I think replacing Broad Street will work out for us,” Edward said. “It sounds like they’ve got big problems.”

After Nick and Katherine left his office, Edward pulled up Sol Levin’s cell number from his BlackBerry and called him.

“Hello?” a woman answered.

“Patsy, it’s Edward Winter. I just heard the news about Sol and wanted to say how sorry I am.”

“Thanks, Edward,” Patsy Levin said. “Let me get Sol for you.”

Edward second-guessed his decision to call Sol as he waited. As bad as his problems were with the bank, Levin’s appeared infinitely worse.

“Hey, Eddie,” Levin said, his normal basso voice resonating over the telephone. “I appreciate the call.”

“I don’t know what to say or do, Sol. But if there’s any way I can be of assistance, I hope you’ll call me.”

“Patsy and I are going to our place in the Poconos for a couple weeks. When we get back, I’ll call you. Maybe we can get together for a drink.”

“I’ll look forward to it, Sol.”

Levin didn’t respond for a moment and Edward wasn’t sure what else to say. He was about to say goodbye when Levin said, “I’m not the only one with problems, Eddie. Before I left my office today, I found out about the edict the bank examiners had brought down on the bank. They’re forcing Broad Street Bank to slash its exposure to commercial real estate loans. That means companies like yours are going to be run out of the bank.”

“I know, Sol. Stan Burns broke the news to me today.”