Below is a letter from Mr. John L. Morgan, beneficial owner of approximately 7% of Lenox (LNX), to Ms. Susan E. Engel, Chairwoman and CEO of Lenox.

Dear Susan,

When your board offered me a directorship on September 18, 2006, we discussed the reasons that made it unacceptable. At that time, I reiterated that I could best serve the shareholders of Lenox Group by assuming a leadership role on the Board of Directors and playing an active role in formulating and guiding the strategic direction of the Company. Furthermore, I expressed my intention to not make changes in the management or Board of Directors. My views were based on information I had at that time.

The Board’s rejection of my offer to help the Company create a successful strategy has given me a different perspective. I now feel that the Board has decided to pursue a course of action that is not in the best interests of the shareholders and is a continuation of the strategies that have failed to create value over the past ten years.

The management team and Board of Directors continue to behave like the Company is a large, successful Company that has margin for making more mistakes. I do not agree. My offer to assist the Company in changing its strategy to benefit shareholders has been rejected although I proposed to work with the existing management and Board of Directors. You have made your position clear and I hope this letter will do the same for me and other likeminded shareholders.

Very truly yours,

John L. Morgan

The Ownership Situation

First, let me explain the ownership situation. The reporting persons are John L. Morgan, Kirk A. MacKenzie, Jack A. Norqual, and Rush River Group. Rush River Group is a limited liability corporation (LLC) of which Morgan, MacKenzie, and Norqual are members.

Rush River was formed in December 1998 in Minnesota and “its principal business activities involve investing in equity securities of privately owned and publicly traded companies, as well as other types of securities.” As far as I can tell, the only members of Rush River are the three aforementioned men: Morgan, MacKenzie, and Norqual.

According to a recent SEC filing, Morgan beneficially owned 6.1% of the outstanding shares of common stock in Lenox, Rush River owned 0.79%, MacKenzie owned 0.07%, and Norqual owned 0.07%.

Please keep in mind that this 7% stake in Lenox is controlled by Mr. Morgan; but, not Winmark Corporation (WINA), a publicly-held franchisor of retail stores. This is an important distinction to keep in mind (especially since Winmark is a public company).

Morgan is the Chairman and CEO of Winmark; MacKenzie is the Vice Chairman. However, their stake in Lenox has nothing to do with Winmark. In fact, last time I checked, Winmark did not have any material investments in marketable securities.

The reported position amounts to 989,300 shares of Lenox. Shares of Lenox last closed at $6.23 a share. So, the position would be worth a little over $6.16 million. Since Winmark only has a market cap of $126 million, I want to make it clear Winmark does not have a position in Lenox – Morgan does. He just happens to be the Chairman and CEO of Winmark. I hope this clears up any possible confusion about Winmark.

Lenox

Now, I can move on to discussing the truly interesting aspect of this news, Lenox itself.

Lenox is the result of a September 2005 merger between Department 56 and Lenox Incorporated. Prior to the merger, Department 56 was known for its “Village Series of collectible, handcrafted, lighted ceramic and porcelain houses, buildings and related accessories that depict nostalgic scenes”. That last sentence was taken directly from the company’s 10-K, simply because I couldn’t write a better description myself. I assume most of you have seen the series. Even if you haven’t, I’m sure you can imagine the concept of a little porcelain Christmas scene.

Obviously, the Lenox name is much better known than the Department 56 name. Therefore, when Department 56 acquired Lenox, it changed its name to Lenox.

In its 10-K, the company calls the Lenox acquisition a “transformational event”. This term is too often applied to mergers that are far from transformational. In this case, however, it’s a perfectly accurate description.

Whether the transformation is for better or worse is debatable; however, the fact that the merger has transformed the company is not debatable. To put the size of this transaction in perspective, consider this: Today, Lenox (the combined company) has a market cap of $88 million. In September 2005, Department 56 paid $204 million to acquire Lenox Group. Immediately, this should tell you two things. One, the acquisition was probably quite large relative to the existing business. Two, the combined company’s stock price has tanked.

Both of these statements are true. Even when shares of Department 56 were a lot more expensive, the Lenox acquisition was very large relative to the existing business when considered from the perspective of market cap, enterprise value, sales, and just about any other meaningful measure of the size of a business.

Obviously, the combined company’s stock price has been falling hard since the merger. After all, the enterprise value of the entire company is not much greater than the amount Department 56 paid for the Lenox business.

The market is assigning a value of close to zero to the newly acquired Lenox business. This is remarkable considering the fact that Department 56 rarely traded at a lofty multiple when it was a stand alone business. In fact, the company’s shares often traded at a P/E multiple in the high single digits or low double digits throughout the past decade.

The New Business

You probably already know what Lenox does. If you don’t, a quote from the company’s 10-K does a good job of explaining what the newly acquired business does:

“The company sells dinnerware, crystal stemware and giftware, stainless steel flatware, and silver-plated and metal giftware under the Lenox and Gorham brands. Dansk is the company’s contemporary tabletop, houseware and giftware brand. The company sells premium causal dinnerware and fine china dinnerware, giftware and collectibles under the Lenox trademark, and sterling silver flatware and sterling silver giftware under the Gorham and Kirk Stieff trademarks. The company believes that it is the largest domestic marketer of fine tabletop products.”

I’m sure you noticed a bad omen in the above paragraph. One of the company’s brands (Dansk) is described as the company’s “contemporary” brand to differentiate it from the other two brands. Obviously, having fine products that are not considered contemporary is a bit of a problem.

In fact, it may be a very large problem in the years ahead. Overall, it seems the market is moving away from formal dinning and towards more upscale casual dinning. This is not a new phenomenon; nor, is it likely to be a short-lived one.

On the other side of the scales, you do have the simple, undeniable fact that the company has one of the best brand names in its industry. It is also a big player in a very small industry. Those are both advantages that are difficult (if not impossible) to duplicate. For a $200 million business, Lenox has a lot of history – and perhaps, a lot of potential.

The Old Business

A big part of the problem with the performance of the company’s shares (both over the short-term and the long-term) has been the performance of Department 56. In 2005, sales from Department 56’s Village Series declined 21%, “which was consistent with the longer term trend” according to the company’s 10-K. In fact, sales had clearly been declining each and every year from 1999-2005. Furthermore, sales in 2004 were substantially less than sales in 1996. So, even though there wasn’t a continuous, straight-line decline in sales over the past ten years, the general trend for sales of the Village series has been decidedly negative for a full decade now.

To combat the “substantial attrition of the Gift and Specialty channel” the company has settled on two strategies intended to both “offset the decline of the Village business” and “to grow revenues long term”. Those strategies are “expanding the company’s channels of distribution outside its traditional Gift and Specialty channel” and “expanding the company’s product offering to include year-round gift products.” The former strategy sounds promising; the latter strategy sounds implausible.

Lenox is already moving to implement both strategies. In fact, the company made a small acquisition that should help expand Lenox’s year-round product offerings. But, I remain highly skeptical of attempts to transform the gift products business into anything other than a highly seasonal business.

The Acquisition

At the time it was announced, I thought the Lenox acquisition sounded like an interesting move for the company. Department 56’s operations looked lean; the operations at Lenox did not. Furthermore, the price paid for Lenox didn’t look unreasonable, especially when compared to the kinds of prices many public companies have often paid to make such large (”transformational”) acquisitions.

In September 2005, Department 56 acquired Lenox in a $204 million deal (including $7.6 million in transaction costs). Department 56 funded the acquisition “through a $275 million senior secured credit facility consisting of a $175 million revolving credit facility and a $100 million term loan”.

As mentioned earlier, the combined company adopted the more recognizable Lenox name.

Restructuring

As a result of the merger, the company closed approximately half of the stores belonging to its new Lenox subsidiary. In total, the company closed 31 Lenox retail stores. As of February 1st, 2006, this left the company with only 36 retail stores. Six stores were operated under the Department 56 name; the remaining 30 stores were operated under the Lenox name.

After the merger, the company consolidated some of its operations. For instance, Lenox sold its Langhorne, Pennsylvannia facility when it moved certain operations to Bristol, Pennsylvannia. The company has used the cash proceeds of such sales to pay down debt incurred in the Lenox acquisition.

New Concept Stores

Lenox plans to launch a new mall-based chain of stores that will sell all of the company’s brands (Department 56, Lenox, Gorham, and Dansk). The company plans to open three “All The Hoopla” stores during 2006. A fourth store will be opened in 2007.

Opportunities

The combination of Department 56 and Lenox presents several interesting opportunities. Perhaps most importantly, there’s the hope that Lenox will become a leaner operation. Aside from any cost-savings made possible by the merger, there is also the simple fact that Department 56 was always a leaner operation than Lenox, and that the management at the new company might be more adept (or more determined) to keep costs down.

There is also some promise to the idea of selling all of the company’s brands together. To a large extent, the distribution channels are similar. The “All The Hoopla” concept proves the company is committed to this bundling of its products. However, it’s hard to see how the company’s products are going to be much of a draw on their own. Is there really enough demand for these Lenox operated retail stores? The company’s current plans call for a very limited launch. So, the price of failure would not be very great. Obviously, a success here would greatly benefit the company in the long run.

Conclusion

Lenox is an interesting opportunity. The business looks very cheap based on averages of past sales, EBIT, pre-tax earnings, etc. However, Lenox is now an entirely different company. The old Department 56 business faces rapidly declining sales. Neither Lenox nor Department 56 looked like a very promising business at the time of the merger. Today, they don’t look a whole lot more promising together.

On the other hand, it’s important to look past the company’s recent results (which include a large write-off). It will take time to see the full effects of the merger. At present, it’s difficult to judge either company independently, because of the acquisition.

Still, this is clearly a cheap business by most measures. There are problems at Lenox (as there were problems at Department 56). But, if the business can be run right, it should reward shareholders who buy at today’s extraordinarily low levels.

Morgan’s letter presents both the hope that there will be change and the realization that such change will not be easy. Clearly, the company’s past performance has been unacceptable. The stock has never been as cheap as it is today; but, the problems have been just as bad.

Lenox offers an interesting opportunity for patient investors. Nonetheless, being a Lenox shareholder is certain to frustrate you even if it does eventually reward you.

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You’re sitting there one day, off from work due to the stress of your unsecured debts weighing heavily upon your shoulders. Suddenly, in the background noise from the TV you hear a fantastic deal – consolidate your existing debts into ‘one easy affordable loan’. You think wow, just what I need to get my debts under control and you get the sales blurb.

Sounds great doesn’t it?

Debt consolidation in the UK is not a new phenomena these days. It’s been around a while. Lots of people have taken out debt busting consolidation loans. So why is the amount of debt in the UK still rising so fast? And why are bankruptcies, IVA’s and debt counselling services stretched to their limits and running at all time high figures right now? Well people get sold on the advantages but I’d recommend thinking about the disadvantages too!

Advantages of debt consolidation UK

Well the interest rate normally comes down on the unsecured debt amount borrowed making the monthly payments easier to afford.

Your debts come under control quickly so the annoying telephone calls and letters from irate creditors stops.

Disadvantages of debt consolidation UK (this is the bit they don’t want you to think too hard about)

To get a debt consolidation loan usually requires some form of property. By consolidating the unsecured debts to your home some of the equity has now been lost. So what was once an unsecured debt now forms part of a charge over your property. Every legal advert in the UK selling this type of service will point out in the small print that your home is at risk if you fail to keep up payments on (this now larger) secured loan. So you’ve put more risk onto your property. I regularly meet people who have bought their house maybe 20 years ago for figures like £80,000 on a house worth £110,000 to find that a decade on they have a house worth (say) £180,000 with a new debt consolidated mortgage of £150,000. So they still only have a similar amount of equity in the property but also have a mortgage now nearly double in size!

Another disadvantage is that the term of the borrowing is usually increased. Well sometimes the debt consolidation companies in the UK will sell that as a benefit with a line like ‘you can take longer to pay your debt and allow yourself time to get on top of your borrowing over the coming years’. I find that an odd statement. You have doubled your mortgage in a decade and you have found yourself in debt but suddenly your spending habits will change and you’ll be debt free at some point in the future. What are your thoughts as you read that? Another interesting point arises here. Because the term is often longer, you will possibly end up paying much more of your hard earned money for that unsecured borrowing by the time you pay off your new secured lending.

Did the debt consolidation company ask what your lifetime ambitions are? You see, you may have got out of the immediate debt issues but you may just also have signed away the possibility of that early retirement / new car / that holiday to see your family down under too. You see, if the amount you are paying back is higher than you had budgeted for then you may need to work longer to achieve your dreams. Was this discussed with you?

Did you consider at least 6 solutions for getting our of debt trouble before you decided on your debt consolidation loan? Can the company you speak to even name 6 solutions for getting out of debt trouble? If not then you have ignored several other options that may have been more suitable for the financial position you found yourself in. It’s rare indeed to find loan and mortgage brokers that are fully trained in solutions to tackle insolvency and debt issues. They have their offering and will talk about the monthly repayment figures to demonstrate how you could be better off, but is it the best way forward? Well naturally, that depends on your situation.

A final word on debt consolidation in the UK

Now, I do believe that debt consolidation has its place but I also think that there could be more done to understand that there are other options for getting out of debt. Getting the right debt help and advice is essential. Look at the advantages and the disadvantages for each solution you consider for debt resolution and then make a more informed decision.

There are more options for getting out of debt trouble then most people realise, that includes debt consolidation but is not limited to just that course of action.

If you would like to know what the 6 solutions to debt in the UK are then you can get debt help and advice from Ed Pearson at Debt Dr.

This article does not constitute regulated advice. Please remember that any action regarding financial advice should always be taken only after considering the specifics of your own situation.

To find out more about Ed try, http://www.advice4debt.co.uk/debtquiz.htm

Ed Pearson is a Debt Dr offering debt help and advice to individuals and small businesses across the UK.

Whilst you may love the stuff he writes, you should only ever take action once you have considered your own set of financial circumstances with a professional. This article does not constitute financial advice.

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Chapter 12 (Debt): Dr. Martenson explains how, since debt is a claim on future money, it is therefore a claim on future human labor. To put it simply, debt is future consumption taken today. Key Concept 7 is introduced, that “ever-growing debts implicitly assume that the future is going to be larger than the present.” Dr. Martenson challenges this assumption, and what it means for us if that condition of growth is not met. www.chrismartenson.com

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Are you struggling to work out how you should be dealing with debts? Rest assured you are not alone, as more and more people are struggling to deal with their unsecured debts due to rising living costs and a lack of willingness to lend by most high-street banks.

You don’t have to worry about dealing with debts alone, there are companies our there that are willing to help you leave your debt worries behind and look forward to a debt free future. No matter how much debt you have or how many unsecured creditors you owe money to, it is never too late to seek out ways of dealing with debts.

There are a number of debt solutions on the market which are all designed to help you deal with debts and reduce your monthly payments to your creditors. These include:

Debt Management Programme – The debt management programme is offered by many financial solutions companies across the country. They are designed to offer you a reduced payment to your creditors. Making your unsecured debts more affordable means that you can keep to a good standard of living without having to worry about missing payments to your unsecured debt, but it is likely that the length of time you will be paying back this debt will increase.

Debt management programmes are only really suitable for those with debt which is less than £12,000, if your debt is higher than this level and you are struggling then you may be more suitable for an IVA.

IVA (Individual Voluntary Arrangements) – IVA’s were introduced as a more realistic alternative to bankruptcy for those who are struggling with high levels of debt. Once accepted onto an IVA, the average term is 60 months. During this IVA term you must commit to making a set reduced payment to your IVA. This will be distributed amongst your creditors who will write off any unpaid debt upon completion of an IVA.

An IVA is a legally binding contract between you and your unsecured creditors so it is essential that you continue to make the payments to your creditors so you do not have to risk bankruptcy.

These are just two of the ways which you could be dealing with you debt. The best way to go about dealing with your debts and to become debt free is to get in contact with a company which can offer you the full range of debt solutions.

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Debt vs. Equity. Market Capitalization, Asset Value, and Enterprise Value.

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The markets are changing. And that is a fact that cannot be denied. In fact, they are more dynamic than ever before, and the rate of change is phenomenal.

Changing market trends are a beyond our control. The reason we are talking about this topic today is because of the current market situation, where everyone is so worried about everything. If you look back into the history of our finances, there has never been a time so strong and with such a lot of growth opportunity as we’ve had over the last few years. But then, all things change, and what goes up must come down (according to an old Indian saying).

But a lot of things are looking up. There is a lot of market potential in emerging markets, and all we need to do is look beyond our borders, and things will be fine. The problem with some fellow baby boomers is that we do not look beyond the USA. The USA has been the first country to foster globalization, and today, we believe that the same globalization is threatening us. However, once we break free of the psychological shackles that we have created for ourselves and truly believe that the whole world is one global village, new opportunities will suddenly crop up.

Our children, the echo boomers, are better than we are in comprehending this. They are more global in their outlook, and thanks to the work that we have done, they have the whole world to do business with. And with e-commerce playing a larger and larger role in our daily life, the market trends are bound to change. So, sit back, enjoy and adapt to these changes. That will ensure that our lives are happy and we stay in control.

www.boomeryearbook.com is a social networking site connecting the Baby Boomer generation. Share your thoughts, rediscover old friends, or expand your mind with brain games provided by clinical psychologist Dr. Karen Turner. Join today to discover the many ways we are helping Boomers connect for fun and profit.

For www.boomeryearbook.com

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12_29_09 Gerald Celente on Fox Business; 2010 Market Trends www.peopleforfreedom.com

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Before seeking an SBA (Small Business Administration) loan, borrowers should analyze several key business finance issues. This article will serve as an overview of the most important business loan and commercial real estate loan factors to assess before buying a business investment with an SBA loan in order to avoid numerous potential misunderstandings about a complicated business financing process.

Finalizing an SBA loan and refinancing a Small Business Administration loan are two of the most problematic commercial mortgage and business loan scenarios for business owners. There are practical business finance solutions for both of these common business investment problems.

Are SBA Loan and Business Finance Programs Difficult?

There are usually two schools of thought about getting a Small Business Administration loan to buy a business:

(1) Avoid this kind of commercial loan at all costs.

(2) Use such a business finance loan whenever possible.

These conflicting investment financing viewpoints are due to a commercial mortgage business loan process that is perceived as complex and difficult by many commercial borrowers.

In reality SBA loan programs are more practical than they often appear. It is critical to the success of a Small Business Administration loan program to be working with a business finance advisor and lender that is proficient at this difficult commercial mortgage and commercial loan process. There are many potential commercial financing problems to avoid when attempting to obtain a small business loans, and very few lenders are skilled in this business financing area.

Expecting Business Investing and Financing Difficulties: Business Loan Refinancing

One of the major investment drawbacks of an SBA loan has historically been the difficulty of refinancing the Small Business Administration business financing later. Current options have revised the situation and it is more feasible to arrange refinancing. It is still accurate to say that refinancing is not routinely available, but more importantly it is much easier to obtain than it was in prior years.

Advance commercial real estate loan and commercial loan planning can avoid some of the SBA loan refinancing problems. First and foremost, if the original business financing is arranged without a small business loan, this will make later business refinancing easier than if a Small Business Administration loan is involved. This means that commercial borrowers should at least consider if the initial business loan requires this form of commercial financing before proceeding.

Finalizing Small Business Financing: Two Common Commercial Loan Misunderstandings

One of the most frequent criticisms of an SBA loan program is the amount of paperwork required to complete the business loan and commercial mortgage process. What many commercial borrowers fail to understand is that any business financing process is likely to involve substantial paperwork and formal documentation requirements. In the end the key is working with a business finance advisor that understands what is required and can facilitate the submission procedures.

Beyond the paperwork concerns, a more critical and real problem is working with an SBA lender that is not very good at successfully completing Small Business Administration loan requirements. There are not many commercial lenders who are routinely effective at finishing this complex loan process with timely and successful results.

Alternatives to SBA Loan Financing – Conventional Real Estate Investment and Business Opportunity Loan Options

Conventional business finance options should always be considered simultaneously with the possibility of obtaining an SBA loan. As noted above, the feasibility of refinancing a business loan or commercial real estate loan in the future will depend heavily on the choices made by a commercial borrower when obtaining the initial commercial mortgage.

A conventional business loan or commercial mortgage might be more feasible than many borrowers realize. Refinancing is likely to be more successful if an experienced business finance lender and advisor are involved.

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Robinho grabbed the winning goal in his first game back with Santos, giving the team a 2-1 win over Sao Paulo. Music from Haight-Ashbury – Favourite Song. The Brazil international, on loan from Manchester City after falling out of favour at Eastlands, came off the bench to net the winner five minutes from time Robinho combined with Wesley for the goal, backheeling in a cheeky effort to complete a fine cameo performance. Robinho returned to Brazil on loan from City to boost his hopes of regaining his form and winning a spot in the Brazil squad for this summer’s World Cup finals

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