After the bankruptcy of XS2 Europe BV vague rumors were spread.
It is easy to spread rumors, especially using the internet.
In case of bankruptcy the director and/or owner of the bankrupt company does not have the possibility anymore to explain to the public what really happened.
This website is nowadays owned by Mr.Rene Eringaard privately and is used to explain what really happened.
I describe the position and attitude of banks, credit insurance companies, tax authorities and shareholders.
So, below I will describe the summarized (pre)-history by each year of XS2 Europe BV until bankruptcy which was requested by Rene Eringaard personally and which was approved by order of the Court of Amsterdam on November 2nd, 2010.
If you would like to have visuals of the history of XS2 Europe BV, then you can click on below weblinks.
PLEASE BE NOTED THAT THESE WEBLINKS ARE COMMERCIALLY NOT ACTIVE ANYMORE !!
PLEASE BE NOTED IT WILL TAKE SOME TIME TO LOAD THESE WEBSITES !!
Year: 2002 february Website: XS2
Year: 2003 august Website: Promedion (brandname used by XS2)
Year: 2010 november Website: XXODD (brandname used by XS2)
Year: 2010 november Website: Wombee (brandname used by XS2)
Year: 2010 november Website: XS2
If you would like to have an impression of marketing material created by Mr. Rene Eringaard and XS2 Europe BV then you can click at below weblink:
Year: 1996 until 2011 marketing material of ICP and XS2 Europe BV
1986-1987:
SYDEC Technology Distributors
(importer/distributor of computers/components)
Mr. Rene Eringaard was responsible for smaller retailers in The Netherlands.
Besides that Mr. Rene Eringaard was reponsible for launching Hyundai computers in the Dutch market.
Sydec had offices and activities in The Netherlands, Belgium, Germany, UK, Taiwan
Sydec was a company with 250+ employees
1987-1996:
ICP International Computer Products
(importer/distributor of computers/components)
Mr. Rene Eringaard becomes responsible for sales management and procurement in Taiwan and the U.S.A.
Mr. Rene Eringaard becomes responsible for the distribution of a quarterly published 32 pages full color magazine in Holland, Belgium and UK written in Dutch, French, and English language and with prices in
four different currencies for roughly 1000 products.
Mr. Rene Eringaard was the ”writer and editor” of this magazine.
1992–1996:
In above years the director of ICP gave Mr. Rene Eringaard full power and full control to launch a new advanced tape back-up system for the mainstream market.
It means that Mr. Rene Eringaard had total freedom regarding purchasing, sales, marketing, advertising.
This total freedom, combined with Rene Eringaard's marketing study at that time resulted in the fact that ICP became market leader in Holland, Belgium by shipping average 45.000pcs tape drives each year.
This product was manufactured by Colorado Memory Systems (U.S.A / Colorado) and was one of the first tape drives with a price below DFL 1000 (nowadays Euro 453 or US$ 638)
Colorado Memory Systems became a division of Hewlett Packard in 1994.
At the time that Mr. Rene Eringaard joined ICP, there were only 4 employees and one office near Amsterdam.
At the time that Mr.Rene Eringaard left ICP, they had 70+ employees and offices in The Netherlands, Belgium, UK, Taiwan.
ICP became one of the biggest computer distributors in The Netherlands and Belgium and has been sold to a UK company called Datrontech.
Mr. Rene Eringaard and Mr.Wildevuur (employee of the Chamber of Commerce) start preparing a business plan for a new company called Sumo International BV which will be owned by Mr.Rene Eringaard.
(Later we changed this name to XS2 Europe BV)
1996 Autumn:
Mr.Rene Eringaard erects XS2 Europe BV i.o. and starts the import/trading of computers and components.
XS2 Europe BV i.o (in dutch a so called "one man company" starts trading using the name "XS2")
1996 Autumn:
Mr. Rene Eringaard and Taiwanese company A-Trend (listed on the Taiwanese stock exchange) agree to establish a joint-venture company in The Netherlands called XS2 International BV.
XS2 International BV will have the exclusive rights to distribute A-Trend's products in The Benelux. (mainboards, vga-cards, networking products)
A-Trend will also support XS2 International BV with loans and special payment terms.
1997:
XS2 International BV decides to establish a new company called XS2 Europe BV.
XS2 International BV becomes a 60% shareholder of XS2 Europe BV.
The remaining 40% of the shares will be given to 3 employees of XS2 Europe BV.
XS2 Europe BV continues trading using the name "XS2"
XS2's target is the import/trade of computer components and own branded computer systems
XS2 becomes a direct customer and/or distributor for following manufacturers:
A-Trend (Taiwan), Acer Peripherals (Taiwan), Ovislink (Taiwan),
Epson (Japan), Promise (Taiwan), Sung-il (Korea)
Introduction of the A-Trend Voodoo 3D graphics accellerator by XS2 in the Dutch market.
Introduction of desktopsystems branded as "XS2" or "Promedia" (mostly using AMD and Cyrix processors)
Turnover: Euro 8 million
1998:
XS2 becomes direct customer and/or distributor for following manufacturers:
Umax (Taiwan), AMD (USA), Gainward (Taiwan), Billion (Taiwan), Tatung (Taiwan)
Rene Eringaard decides to register the brandname "Promedia" as a trademark in the Benelux for desktopcomputers.
Turnover: Euro 14 million
1999:
XS2 becomes direct customer and/or distributor for following manufacturers:
MSI - Micro Star International (Taiwan), Minton (Taiwan), CoSonic (China), EzKey (Taiwan), Clevo (Taiwan), Jetway (Taiwan), Unifosa (Taiwan)
VNU Belgium (publisher of the Yellow pages) starts complaining about the fact that XS2 is using Promedia as a brandname for computers.
Rene Eringaard decides to change the brandname "Promedia" to "Promedion" and registers it as a trademark in The Benelux.
XS2 starts to sell desktops and notebooks using the brandname "Promedion".
Introduction of high performance notebooks which will be done continuously until november 2nd 2010.
Introduction of desktop systems with integrated Dolby Digital 5.1 integrated amplifier.
XS2 International BV becomes a 60% shareholder of XS2 Investments BV.
40% shares in XS2 Investments BV belongs to 3 other companies erected by 3 employees of XS2 Europe BV.
(Person 1: 20% + Person 2: 10% + Person 3: 10% = 40%)
XS2 Investments BV becomes a 100% shareholder of XS2 Europe BV.
Turnover: 18 million Euro
2000:
XS2 receives the "Clevo Excellent Partner" award.
XS2 receives the "MSI Master Distributor" award.
XS2 becomes an official recognized training company for ICT-students (VEV)
XS2 becomes direct customer and/or distributor for following manufacturers:
Fujifilm (Japan), Raite (Taiwan), J&S (Taiwan), Onstream (USA), Lucky Star (Taiwan), Labway (Taiwan), ViewSonic (USA)
Mr.Wildevuur who helped me to establish XS2 dies at the age of 72.
XS2 has 35 employees in this year.
Most of these employees are not aware of the fact that Mr.Wildevuur was involved deeply in establishing XS2, that is why i write it down here.
Turnover: 28 million Euro
2001:
XS2 receives the "Clevo Excellent Partner" award.
XS2 receives the "Jazz Hipster Excellence in Distribution" award.
XS2 becomes direct customer and/or distributor for following manufacturers:
Neng-Tyi (Taiwan), Amoisonic (China), Holux GPS-systems (Taiwan), BenQ (Taiwan)
Introduction of a handheld GPS system in the dutch market by XS2 branded "Promedion"
Turnover: 35 million Euro
2002:
XS2 receives the "Clevo Excellent Partner" award.
XS2 receives the "Jazz Hipster Excellence in Distribution" award.
XS2 becomes direct customer and/or distributor for following manufacturers:
PQI (Taiwan), Pixelview (Taiwan), Z-Com (Taiwan)
XS2 introduces a GPS system for pocket-PC's and notebooks branded "Promedion"
XS2 introduces LCD-monitors and LCD-PC's branded "Promedion"
XS2 Introduces Wi-Fi products branded "Promedion"
Turnover: 33 million Euro
2003:
XS2 receives the "Clevo Excellent Partner" award.
XS2 receives a personal award by the director of MSI in The Netherlands "Outstanding Partnership"
XS2 receives the "MSI excellent performance" award.
XS2 receives the "PQI Regional Distributor of the year" award.
XS2 becomes direct customer and/or distributor for following manufacturers:
Hitachi - harddisks- (Japan)
XS2 becomes one of the biggest computer assemblers of desktops and notebooks in The Netherlands using the brandname "Promedion"and this will continue until november 2nd 2010 under the brandname "XXODD"
XS2 introduces an extremely compact MP3 player with integrated FM-radio and LCD-screen using the brandname "Promedion"
Turnover: 28 million Euro
2004:
XS2 receives the "Clevo Excellent Partner" award.
Magazine: Winmag magazine > Promedion D410V notebook receives "Winfavorite" award.
Magazine: PCMagazine > Promedion D500P receives "Editors Choice" award.
Magazine: PCPlus magazine > Promedion D410V notebook receives "Best Buy" and "Best Tested" award.
Magazine: Hardware Info > Promedion D870P described as "ultimate notebook, racemonster"
Magazine: WinMag > Promedion L297P LCD-PC receives "Winfavoriet" award.
Magazine: WirelessComputing > Promedion D410V receives "first choice" award.
Magazine: PCconsument > Promedion D410V receives "Best Buy" and "Best Tested" award.
Magazine: HET > Promedion D470W tested as "beautiful 17" notebook with power"
Magazine: CHIP > Promedion D900T tested highest score in desktop replacement notebook test.
XS2 becomes an official recognized training company for ICT-students (Ecabo)
XS2 becomes direct customer and/or distributor for following manufacturers:
Hitachi - audio/video - (Japan), TomTom (NL), MIO (Taiwan), ADATA (Taiwan)
XS2 introduces a Promedion tablet PC with 14" touchscreen and handwriting recognition.
XS2 introduces a range of portable DVD-players with 7"and 10" LCD-screen branded "Promedion"
XS2 introduces one of the first handheld palmsize digital video recorders which allows people to record Mpeg4 movies easily branded "Promedion"
Turnover: 29 million Euro
2005:
XS2 receives the "Clevo Excellent Partner" award.
XS2 receives the "Microsoft Gold Certified Partner" certificate.
XS2 receives the "MSI outstanding partnership" award.
XS2 becomes a member of the Intel Product Integrator Program.
Magazine: PCMagazine > Promedion D900T tested as "faster then almost all desktop systems"
Magazine: PCM > Promedion D900T receives "Best Product" award.
XS2 introduces a digital camera with the size of a pen, with a 2.0Megapixel camera using the brandname "Promedion"
XS2 introduces a range of external USB-harddisks up to 400GB branded "Promedion Edrive"
Summer 2005 German company Medion starts complaining about the fact XS2 is using "Promedion" as a brandname.
Rene Eringaard decides to change the "Promedion" brandname to "XXODD" in order to avoid conflict with the German company Medion.
Turnover: 34 million Euro
2006 part 1:
XS2 receives the "AMD Solution Provider Platinum" award.
XS2 receives the "Clevo Excellent Partner" award.
XS2 receives the "Hitachi Strategic Partner" award.
XS2 receives the "Intel Channel Partner Associate Member" certificate.
XS2 receives the "Microsoft Gold Certified Partner" certificate.
XS2 receives the "MSI Excellent Star" award as the best distributor in The Netherlands.
XS2 receives the "Ovislink Outstanding Cooperation" award.
Magazine: Computer Totaal > "Our Choice" award for XXODD notebook XNi570B.
Magazine: Computer Totaal > "Our Choice" award for XXODD notebook XNi570U2.
Magazine: PC-Consument > "The Fastest Notebook" predicate for XNA700.
Magazine: WINMAG > "BEST PRODUCT" award for 550V notebook with hardware data encryption.
Magazine: PC-Active > "the fastest notebook" predicate for XNA700K.
XS2 becomes direct customer and/or distributor for following manufacturers:
Arima - notebooks - (Taiwan), QNAP Systems - NAS solutions - (Taiwan), MaPower Electronics (Taiwan), Twinmos (Taiwan)
"XXODD" is launched by XS2 as "the"' brandname for desktops, notebooks and other computer peripherals.
"XXODD" is focusing on custom made assembled notebooks and desktops with reseller-price mostly above Euro 1000.
"XXODD" introduces a GPS-GSM handheld locator so that people can trace cars, boats and persons by using Google Maps.
XS2 still remains a distributor for many Taiwanese companies, however "XXODD" branded products are generating most of the profit.
In fact, for the next years "XXODD" branded products will be the main reason of the existence of XS2.
Turnover: 35 million Euro
Until this sentence XS2 is a success story
However XS2 will face huge problems in the years 2006 - 2010.
2006 part 2:
As mentioned before XS2 was also importer/distributor of computercomponents.
In spring of the year 2006 one of our employees (also 20% shareholder) started to intensify purchasing and selling of large quantities of CPU's.
These CPU's were sold separately in The Netherlands and Germany, besides that they were assembled in "XXODD" branded computer systems.
The export of these CPU's generated a VAT tax-refund of Euro 858.000.
This is not abnormal, because the CPU's were bought in The Netherlands and VAT was paid by XS2 to the Dutch company that was supplying, delivering and invoicing XS2 for these CPU's
.
However the tax authorities freeze an amount of Euro 858.000 VAT tax-refund.
Tax authorities are claiming that the trading of these CPU's belong to a VAT-carroussel.
Rene Eringaard decides to initiate court proceedings against the Dutch tax authorities in spring 2006.
The result of this dispute with the tax authorities is a limited liquidity and/or cash flow problem which will continue until januari 2008 !
XS2 is strongly restricted in all of its activities !
XS2 was depending on several credit lines:
a: ING-Bank > normal bank credit line
b: ING-Comfin > credit line based on factoring
c: Credit insurance companies like Atradius, Euler Hermes, Coface
(these companies insure the delivery of goods from manufacturers to XS2)
Mr.Rene Eringaard informed the ING-bank regarding the dispute with the tax-authorities.
Within one week ING-bank decided to cancel the credit line.
Interesting to see, because the dispute with the tax-authorities has never been studied by ING-bank.
The positive part is that ING-Comfin did not agree with the fact that ING-bank stopped the credit lines.
ING-Comfin actually increased the credit line based on factoring for several months.
By doing so, Mr.Rene Eringaard had more time to discuss a credit line with ABN-AMRO bank.
In the summer of 2006 ABN-AMRO bank arranged a new credit line for XS2 Europe BV.
Regularly meetings with credit insurance companies became necessary, because several times it occured that they suddenly stopped the credit lines without notifying XS2, resulting in the fact that manufacturers suddenly could not ship goods to XS2. By doing so, the supply of goods to XS2 became unreliable.
This behaviour of credit insurance companies will continue until november 2nd 2010, the day that XS2 was declared bankrupt.
2007:
XS2 receives the "Clevo Excellent Partner" award.
XS2 receives the "AMD Solution Provider Platinum" award.
XS2 receives the "Microsoft Gold Certified Partner" certificate.
Magazine: PCMagazine > "Editors choice" award for XXODD notebook XNi570RU.
Magazine: PCMagazine > "Editors choice" award for XXODD notebook D901C.
XS2 starts cooperation with Intel to introduce customized painted notebooks and notebooks with the logo of professional Dutch soccer clubs Feyenoord and PSV(Philips Sport Vereniging)
XS2 becomes direct customer and/or distributor for following manufacturers:
Mitac - notebooks - (Taiwan), Philips & Lite-On Digital (Taiwan)
The court case from 2006 continues in the year 2007, however the court gives no concrete judgement!
Tax-authorities changed their story suddenly:
The invoices of the company that supplied these CPU's in the year 2006 to XS2 were not correct according the tax-authorities.
Tax-authorities were claiming that the abbreviation B.V. (which means LTD) was not printed on the invoices. Due to this reason the tax-authorities claim that the VAT mentioned on these invoices is not deductable.
Because of these proceedings, XS2's liquidity is extremely limited and its activities also.
Rene Eringaard initiates a forced reorganisation of XS2.
The purpose of this reorganisaton is to reduce the costs with Euro 75.000 per month.
This reorganisation is completed in July 2007 and the costs are reduced by laying off employees.
In the mean time Rene Eringaard intensifies his contacts with mainly Taiwanese manufacturers.
XS2's role as distributor is getting smaller due to the fact that cashflow is limited.
However XS2 is expanding its activities rapidly under the name XXODD.
Activities under the name XXODD need less cashflow because the sales turnover is lower compared to distribution of components. However the gross profit is higher.
In September 2007 XS2 has been transformed from a normal importer/distributor of computer components to a value added manufacturer of high quality notebooks, desktop computers and network/data storage products.
The gross profit percentage rises considerably as a result.
The year 2007 however ends with a loss of Euro 100.000 created through one-off reorganisation costs, advisory costs, lawyers, redundancy payments.
Regularly meetings with credit insurance companies became necessary, because several times it occured that they suddenly stopped the credit lines without notifying XS2, resulting in the fact that manufacturers suddenly could not ship goods to XS2. By doing so, the supply of goods to XS2 became unreliable.
This behaviour of credit insurance companies will continue until november 2nd 2010, the day that XS2 was declared bankrupt.
Turnover: Euro 18 million Euro
2008:
XS2 receives the "Clevo Excellent Partner" award.
XS2 receives the "AMD Platinum Partner" award.
XS2 receives the "Intel Channel Partner Premier Member" certificate.
XS2 receives the "Microsoft Gold Certified Partner" certificate.
XS2 receives the "MSI Outstanding Partnership" award.
Magazine: Dutch Consumer Guide > XXODD notebook XNi8515 tested as notebook with best energy saving.
Magazine: PCM > XXODD 8212 ultra light magnesium alloy notebook receives "Best Buy" award.
XS2 becomes direct customer and/or distributor for following manufacturers:
Topstar - notebooks - (China), Raidon Technology (Taiwan), Patriot Memory (USA/Taiwan)
Rene Eringaard (and XS2) faces the fact that (according the Dutch law) the financial statements of the year 2006 must be published at the Chamber of Commerce before january 31st 2008.
Since the court have not given any concrete judgement on the dispute with the tax authorities,
it will be difficult to show this financially in the profit and loss account of the year 2006.
The banks and/or the credit insurance companies are threatening to stop credit lines and they want to have clarity on this situation !
Rene Eringaard decides to arrange personal discussions with the tax authorities in the first week of january 2008 in order to reach agreement.
Tax authorities are putting pressure on Mr.Rene Eringaard as the indirect director of XS2.
Details which i cannot describe her, but beyond your imagination.......
Rene Eringaard has no other choice then agreeing with a settlement proposed by the Dutch tax authorities:
This settlement contains that XS2 will stop the (Supreme) Court proceedings against the Dutch tax authorities.
This settlement contains that XS2 will pay Euro 350.000 to the Dutch tax authorities.
This settlement contains that Euro 858.000 VAT Tax refund (frozen by tax authorities) will not be paid to XS2.
So the total amount of damage for XS2 is Euro 350.000 + Euro 858.000 = Euro 1.2 million !!!!
As described before, Mr.Rene Eringaard indirectly controls 60% shares of XS2 Europe BV.
The other 40% is indirectly controlled by 3 employees of XS2 Europe BV:
Person 1: 20% indirectly shareholder (Mr. W.F.E.)
Person 2: 10% indirectly shareholder (Mr. W.M.H.)
Person 3: 10% indirectly shareholder (Mr. J.K.)
Person 1 is a brother of Rene Eringaard and also started the trading of the CPU's resulting in a lawsuit with the dutch tax authorities.
If you understand the story until this sentence, then you understand that XS2 had to book a damage/loss of 1.2million Euro.
Because of this loss the own capital/reserves of XS2 Europe BV were decreased significantly and blocking the company its normal way ofdoing business.
Mr.Rene Eringaard decides to have a shareholders meeting:
Target is a capital injection in XS2 Europe BV paid by the shareholders of XS2 Europe BV.
However the other 3 indirect shareholders refuse to inject capital in XS2 Europe BV !!
Mr.Rene Eringaard decides to deposite in a private capacity a sum of Euro 400.000 in XS2 Europe BV to supplement the own capital of XS2 Europe BV.
Mr.Rene Eringaard solved the dispute with the tax authorities and also increased the own capital of XS2 Europe BV using allmost all of his private money.
Because of the fact that these other 3 indirect shareholders refused to inject capital in XS2 Europe BV their percentage of shares decreased significantly.
Their percentage of shares dropped from:
40%
(Person 1: 20% + Person 2: 10% + Person 3: 10% = 40%)
to:
20%
(Person 1: 10% + Person 2: 5% + Person 3: 10% = 20%)
On the end of January 2008 Mr.Rene Eringaard published the financial statements regarding the year 2006, mentioning a loss of 1,2million Euro.
This has been published on time according the Dutch law.
This loss of 1.2 million Euro is dramatic, but a lawsuit against tax authorities has been solved and clarity for banks and credit insurers was provided.
(In the worst case scenario a lawsuit could go on for many years to come and the banks/credit insurers should stop credit lines causing a bankruptcy of XS2)
Honestly speaking, Rene Eringaard managed to keep the company alive.
In Januari 2008 XS2 could start focussing on normal business without the problems of a lawsuit and laying off people. Turnover and gross profit proceed according to plan until september 2008.
In October 2008 the beginning of the economic crisis is putting pressure on turnover and gross margin. Demand is weak in the whole market.
This is an abnormal situation because normally in the period between October - December the IT companies are making most of their profit and turnover.
Besides that, Atradius(insurer of credit lines between XS2 and their resellers) is cancelling and/or decreasing a lot of reseller credit lines. A
tradius is reducing their risk by cancelling a lot of reseller credit lines.
It makes it more difficult for XS2 to supply goods on a credit to these resellers.
This action from Atradius has nothing to do with the financial situation of XS2.o
However this action from Atradius is hurting XS2's business significantly.
Regularly meetings with credit insurance companies became necessary, because several times it occured that they suddenly stopped the credit lines without notifying XS2, resulting in the fact that manufacturers suddenly could not ship goods to XS2. By doing so, the supply of goods to XS2 became unreliable.
This behaviour of credit insurance companies will continue until november 2nd 2010, the day that XS2 was declared bankrupt.
In december 2008 XS2 ends the years with a turnover of 14 million Euro and a profit of 50.000 Euro.
2009:
XS2 receives the "Intel Channel Partner Premier Member" certificate.
XS2 receives the "Microsoft Gold Certified Partner" certificate.
Magazine: PCMagazine > XXODD XNi760CUH tested as "desktop replacement to be jealous at"
XS2 becomes direct customer and/or distributor for following manufacturers:
Toshiba - storage - (Germany/Japan)
Between January and June 2009 there is a complete chaos in the market.
Demand is weak in the whole market ,which is abnormal because also the first 4 months of a year should be the peak-season for companies in the IT field.
Turnover and gross margin are under pressure again !
In Januari 2009 Mr.Rene Eringaard decides to take firm action by taking a very close look at the organisation's costs to enable XS2 surviving the economic crisis.
In Februari 2009 Mr.Rene Eringaard starts a drastic reorganisation programme, with the aim of reducing costs by Euro 60.000 monthly. This reduction of costs can be achieved by:
1: Redundancy of 10 employees.
2: Terminating the lease of company cars.
3: Using our technical department to assemble computers instead of an external company.
4: Minimizing costs such as cleaning, accommodation(buildings), dispatch(shipping costs)
5: XS2 has 4 buildings, one building will be divested, so total 3 buildings will be in use after reorganisation.
In July 2009 the reorganisation has been completed.
Cost savings achieved (Euro 60.000 per month)
The first six months of 2009 were tough.
XS2 encountered a loss of Euro 430.000.
Although Mr.Rene Eringaard finished his reorganisation plan at the end of Februari 2009,
it still took him an extra 4 months to complete the reorganisation.
Biggest part of reducing the costs depended on laying off 10 employees,
however the Dutch government(UWV) needed several months to give a permission.
In July, August, September 2009, XS2 is operating with small profits or at least break-even.
In our line of business usually no profit is made during the summer.
Profits are usually generated between October until April.
With a slimmed down, efficient, effective organisation XS2 was looking to the future with confidence.
Between July and December 2009 XS2 generated a small profit of Euro 54.000.
The supply from manufacturers to XS2 is based on credit lines.
Most of these credit lines are insured by Euler Hermes.
In september 2009 Mr. Rene Eringaard receives a phone call from Euler Hermes.
One of their employees requests financial information regarding XS2.
I explained the above mentioned complete story again.
After receiving this information Euler Hermes informed Mr. Rene Eringaard that they will cancel all credit lines immediately.
Mr.Rene Eringaard requests a meeting before they cancel the credit lines.
However the employee of Euler Hermes is unstoppable and hangs up the telephone in a rude way.
Suddenly most credit lines are minimized.
In October 2009 Euler Hermes is even cancelling all credit lines to XS2.
This situation is hurting the supply of goods to XS2 for several weeks.
Besides that Euler Hermes is not responding anymore to phone calls and e-mails from Mr.Rene Eringaard for several weeks.
Rene Eringaard decides to order a huge cake from a bakery decorated with whipped cream.
Mr.Rene Eringaard informs the baker to decorate this cake with words made of delicious chocolate mentioning Rene Eringaard's mobile phonenr. and the text "can you please call me?"
The cake was delivered later that day at Euler Hermes and finally one of the managers of Euler Hermes made a phone call to Mr. Rene Eringaard.
His first question was: "Is the cake poisoned? Can i eat this cake ?"
Anyway, they could eat the cake and Mr.Rene Eringaard was invited to Euler Hermes office.
After that meeting with Euler Hermes all credit lines to XS2 were restored again and manufacturers started to supply again, however XS2 lost a lot of orders in above mentioned weeks because XS2 could not supply goods on time to her resellers.
Regularly meetings with credit insurance companies became necessary, because several times it occured that they suddenly stopped the credit lines without notifying XS2, resulting in the fact that manufacturers suddenly could not ship goods to XS2. By doing so, the supply of goods to XS2 became unreliable.
This behaviour of credit insurance companies will continue until november 2nd 2010, the day that XS2 was declared bankrupt.
Turnover: 10 million Euro
2010:
XS2 receives the "Intel Channel Partner Premier Member" certificate.
XS2 receives the "Microsoft Gold Certified Partner" certificate.
XS2 is supplying mostly to resellers on a credit of 30 days.
However in the year 2010 most of the resellers are delaying their payments.
I assume that the economic situation is still to blame for this.
Only a few resellers are paying within 30 days.
Several large resellers went bankrupt, causing a big loss for XS2.
Be noted that if a reseller goes bankrupt only 80% is insured.
Besides that, some resellers received goods on XS2's own risk.
If such a reseller went bankrupt, then there was a 100% damage.
An important issue is also the fact that XS2 has to use the collection agency more frequently resulting in a lot of payment arrangements.
These payment arrangements were putting a negative effect on XS2's already damaged cashflow.
In July 2010 Mr. Rene Eringaard started to reorganize the company again.
This could only be done by laying off 8 employees.
However permission to lay off these 8 employees was granted in September 2010.
which means that these employees still have a notice of 1 or 2 months before they are not employed anymore. This means that cost saving could only be reached on the end of October 2010.
ING-Bank and ABN-AMRO Bank request financial information.
During meetings Mr.Rene Eringaard explained them that XS2 received permission to lay-off 8 people and that XS2 will be break-even after these people have been laid off.
However ABN-AMRO bank decided to cut down XS2's creditline with a significant amount resulting in an immediate cash flow problem.
This fact, combined with the fact that most of the resellers did not pay their invoices on time anymore,
resulted in a bigger cash flow problem.
XS2 has a yearly contract to insure all outstanding invoices to their resellers.
It is a contract between Atradius and XS2 Europe BV.
XS2 used to have an amount of roughly 7 million Euro insured credit lines to roughly 550 resellers/shops.
In October 2009 Atradius proposed a new contract in which they did not withdraw any credit lines of these reselllers.
Now this seems to be positive, however Atradius wanted to continue insuring resellers only if XS2 was lowering the total amount of credit lines from 7 million Euro to 3 million Euro to XS2's resellers.
Which means that XS2 had to cancel or minimize credit lines on her own.
XS2 had no choice and started to reduce and cancel credit lines to her reselllers in October 2010.
Immediately XS2 was loosing customers due to this policy.
In fact the proposal from Atradius was ridiculous and created a non-workable situation for XS2 and her resellers.
On the end of October 2010 Mr. Rene Eringaard decided to request bankruptcy for XS2 Europe BV at the Court of Amsterdam, The Netherlands.
By order of the Court of Amsterdam, XS2 Europe BV was declared bankrupt on November 2nd 2010.
Extra note:
As described before:
There were three employees within XS2 Europe BV that controlled indirectly 20% of the shares.
In the year 2008 they refused to join a capital injection proposed by Mr.Rene Eringaard in order to make XS2 Europe BV more healthy.
Person 1: Mr. W.F.E. with 10% indirect shares was fired by me in the summer of 2009, this is also the person that started the CPU trading in the year 2006 causing severe problems for XS2 and causing severe problems for the personal situation of Mr.Rene Eringaard. This person is also a brother of Mr.Rene Eringaard.
Person 2: Mr. W.M.H. with 5% indirect shares emigrated in the year 2009 to a foreign country.
Person 3: Mr. J.K. with 5% indirect shares resigned his job in January 2010.
However in the summer of 2010 these 3 indirect shareholders wanted to sell their shares.
They wanted to see money.
Mr.Rene Eringaard explained them that XS2 was experiencing difficult times and that they were making the situation extremely difficult for him and for XS2.
However they insisted in selling the shares.
To make this long story, not to long:
One of the employees (the marketingmanager Mr. T.van K.) of XS2 Europe BV bought these 20% of indirect shares in de middle of October 2010.
Mr. Rene Eringaard has paid the notary costs privately.
2011:
Between November 2nd 2010 and Januari 31st 2011:
Mr.Rene Eringaard has sold the complete stock that was still in the warehouse.
(all kind of computers and computer related components)
(Sale of these goods was done by Mr.Rene Eringaard personally with final approval of the Trustee and the Court Commissioner)
Between November 2nd 2010 and Januari 31st 2011:
Mr.Rene Eringaard has been cooperating with ING-Comfin and together they collected most of the outstanding invoices from resellers.
(If you have read this story until this sentence then I admire you ! My compliments to you !)
Thanks for reading,
Mr.Rene Eringaard
Founder of XS2 Europe BV
