Monthly Archives: January 2010

Bankruptcy Types & Arbonne Chapter 11 Restructuring

There is much confusion over the Arbonne Restucturing through Chapter 11 Bankruptcy. The following outlines the types of bankruptcies and how the Chapter 11 Bankruptcy Arbonne has chosen to utilize works.

Most people are not aware that there are seven types of bankruptcy. Only attornies and those who have experienced bankruptcy would know this.

The seven types of bankruyptcy are:

  1. Chapter 7: For individuals & businesses. A liquidation of assests.
  2. Chapter 9: For municipalities.
  3. Chapter 11: For individuals & businesses. A restructuring of debt.
  4. Chapter 12 (a&b): For family farmers and fisherman.
  5. Chapter 13 (a&b): For individuals with regular income.


What is bankruptcy:

Bankruptcy allows a debtor who is unable to pay creditors to divide up assets among creditors.

The purpose of the bankruptcy process is to make sure all creditors are treated equally and that creditors cease all collection efforts.

Some bankruptcy procedures allow a debtor to remain in business. The increased cash flow from the restructuring allows the business to pay creditors.

When people think of bankruptcy it is usually Chapter 7 that they have in mind. In Chapter 7 all an individual's or a business' assets are liquidated and the funds are distributed to the creditors.

For example say a company had $25,000 in assets but owed $100,000 to creditors and was unable to make payment on this debt. Through Chapter 7 Bankruptcy the company's assets are sold off for $25,000. The creditors would then receive 25 cents on the dollar.

Arbonne Bankruptcy & Chapter 11 Restructuring:
Arbonne is NOT in Chapter 7 Bankruptcy. They are using Chapter 11. Chapter 11 is a restructuring of debt where the debtor, in this case Arbonne, proposes a repayment plan or compensation plan to the creditors prior to filing Chapter 11 in court.

In Arbonne's case the creditors have agreed to exchange debt Arbonne owes them for a percentage of ownership in Arbonne.

Because the court filings began last week this means the creditors have already agreed to the prepackaged plan.

Now that court filing occurred it takes approximately 45 days for the process to be finalized.

For more and current information see my post on Arbonne Chapter 11 Bankruptcy & Restructuring Links.

© 2010, VoiceWind. . .Greg Loveless. All rights reserved.

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Arbonne Chapter 11 Bankruptcy & Restructuring Links

With Arbonne's public announcement of the Restructuring through Chapter 11 Bankruptcy procedures, there have been many Consultant's contacting us as to what this means for the company and the Consultants.

My wife, ENVP Linda Loveless, has notified her team about the Arbonne Restructuring throughs Chapter 11 Bankruptcy. Since this process was initiated, Arbonne Corporate has been very timely and efficient in communicating the facts to the VPs.

My intent is to post information on this web site as it comes available. We will also address any miss information that is brought to our attention as well.

For all the post on the Arbonne Restructuring & Bankruptcy click here on the Arbonne Bankruptcy Category.

The links below provide the official information as of Friday, January 29th, 2010.

  1. Arbonne Restructuring - Interview of Kay Napier, CEO of Arbonne
  2. Letter to Our Valued Customers Regarding Arbonne Restructuring & Bankruptcy:
  3. Frequently Asked Questions about the Arbonne Restructuring & Bankruptcy
  4. Press Release Regarding Arbonne Restructuring & Bankruptcy:
  5. Court Filings and Claims Information Regarding Arbonne Restructuring and Bankruptcy
  6. Arbonne Blog & Consultant Comments on Arbonne Restructuring and Bankruptcy:
  7. SEC Information about Chapter 11 Bankruptcy:
  8. US Courts Information About Chapter 11 Bankruptcy:

As more information comes available, we will post it.

© 2010, VoiceWind. . .Greg Loveless. All rights reserved.

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The Tithe, the Law and the High Priest

The following was a post I made to the Christian Professionals Worldwide topic on "When it comes to Tithing, is the 10% before taxes or after, gross or net pay?"

After reading the posts on this topic with interests there were a couple of issues that caused me concern. The following was my reply.

Old Testament Verses New Testament Dichotomy:
The constant appeal to the OT/NT dichotomy as if the two never met is concerning. Too often the OT and the Law is set up as a straw man to be knocked down by one's NT and grace. It is done to give one a sense of superiority — I am not like them. This is always a false dichotomy. Even more, it is dangerous and kills living a life of service to Christ.

Christ Frees Us to Fulfill the Law not Break the Law:
The idea that Christ's death and resurrection gives one license to not follow the law; and the idea that this act is our freedom in Christ is not only sophomoric but is false. Christ completes the law and in completing it, it stands. When we fall short of it, because He completed it, we stand in Him. The idea that we are free from the law is not an argument for freedom but a license to escape responsibility.

Christ's Fulfillment of the Law Empowers Us to Go Beyond the Law:
Christ's perfect fulfillment of the law does not negate keeping the law but empowers us to meet the law and also frees us to go beyond the law. A case in point is "If someone forces you to go one mile, go with him two miles." (Matt 5:41) Very simply the presence of Christ in us calls us beyond the law. This "beyond" is not against the law. Rather, this "beyond" embraces and includes the law. Now that the Law is fulfilled, even more than the law is now ours to freely choose to do. This freedom kills the false NT/OT and Law/Grace dichotomy by joining the ability to meet the law and the freedom and power to go beyond the law, in One, Christ Jesus, living within us.

The OT Requirement for Beyond the Tithe Supports the Tithe:
The argument that the required tithe was greater than 10% (24%), does not negate the tithe rather it installs it as a beginning point. Thus far from being an argument defeating the requirement for the tithe, it substantiate it in full. Tangled arguments, pressing truth, tend to circle back in on their owners and give clarity to the truth while exposing the weakness of the attempted clarifying argument.

No Temple Equals Greater Priests:
The idea that because there is no "temple" there are no priest is totally false if not cynical on its face. The OT temple and the priesthood was a foreshadowing and an imperfect representation of the prefect priesthood God gave us in His Son Christ, Jesus. Jesus is the High Priest forever according to the order of Melchizedek. The same Spirit that raised Christ from the dead, lives in us. So through the Holy Spirit Christ, the High Priest, lives within us. We then are also priests. But even greater priests than the OT priests because our High Priest never dies. The fact that there is no longer a temple and no longer priests like there were in the OT, does not negate the presence of priests. Rather, the lack of a temple means the imperfect priesthood has passed and the perfect priesthood has taken up residence. Thus the lack of a temple does not negate the priesthood, but rather installs the priesthood fully and permanently.

A quick summary of holiness flow:
From the Holy of Holies the High Priest obtained the presence of the Lord. This was distributed to the other priest. The priest then distributed this presence to the head of each house hold. The head of each house hold distributed this presence to their house hold.

But the moment someone in that house hold came in contact with something considered unclean, for example a Gentile, the presence was lost and the law prescribed what that person and/or house hold had to do to return to the presence.

Fast forward to the NT. Paul writes, "For the unbelieving husband has been sanctified through his wife, and the unbelieving wife has been sanctified through her believing husband. Otherwise your children would be unclean, but as it is, they are holy." (I Cor. 7:14)

Because of Christ's victory, Paul has reversed the holiness flow. Rather than the believer being made unclean by the unbeliever, the believer, with Christ the High Priest living within them, transforms those with whom they come in contact, even the unbeliever. In essence, the believer carries the Holy of Holies with them always and as a result each event and person they come in contact with, is, or should be, transformed by this presence.

Today, a group of believers all possessing this presence have a shepherd to guide, lead and care for them and they call them by various names – Pastor, Minister, Reverend. Caring for their pastor's needs is not a freedom to choose or not to choose. It is a command. And yet those with the presence of the high priest, Christ, fulfill not only the command to care for these, but are free to go the second mile. But know this truth; one cannot go the second mile until they have gone the first mile. One cannot freely give until they have tithed.

© 2010, VoiceWind. . .Greg Loveless. All rights reserved.

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Arbonne Results Approach Alters Business Building Ethic

 Sequence Ethics:
The sequence in which events unfold impacts the ethics of those events. The impact is on the ethical load the events create and the impact these have on the individuals connected to the events.

An example of how a shift in event sequence shifts ethical load is the simple process of purchasing something at a local store verses online. In the traditional process a customer goes to the store, visually inspects the product, they may even test the product before purchase. The customer then takes the product to the cashier and in exchange for payment the customer is allowed to walk out of the store with the item.

Because the sequence of payment and receipt of the product is simultaneous, the risk to the customer is limited. As a result the ethical load in the event, and on those connected to the event is also limited.

But shift this sequence and/or delay an event in the sequence, and the ethical load shifts.

When a customer purchases product over the internet, there is a delay between the payment and the receipt of the product. This shift in the sequence shifts the risk and thus the ethical load. The product may never be shipped. The product may not be what was advertised. The product may not work as the customer thought it would.

So in order to address the increased risk, additional safe guards are built into an online ordering system to deal with the shift in ethical load caused by the shift of event sequence.

Using this as a guide, lets apply this to the ethics of building an Arbonne business.

Ethics of the Arbonne Traditional Business Building Sequence:
In the Arbonne traditional business building systems of Group Presentations and One-on-Ones, as a new Consultant does presentations the Sponsor receives a commission of these sales. The Sponsor is only compensated when the new Consultant is successful. 

The sequence of events in this process is so important to the "Culture of Arbonne" that during Arbonne Opportunity Presentations, in EOA stories, in Blogs and in published trainings, Consultants often use the following quote:

"We become successful when we make you successful."

This statement is directly connected to the ethical sequencing of events in the Group Presentation and One-on-One systems. Only as the new Consultant has success selling product is her Sponsor compensated. Thus the sequence of events in Arbonne's traditional business building system not only makes this an accurate statement, but substatiates the truth of the ethic.

Arbonne Results Approach Sequence Shift, Althers Ethic:
In the Arbonne Results Approach a new Consultant purchases Result Kits. These Kits are then dropped off to potential clients and business builders so they can use the product. At first glance this simple change in the process would appear to be insignificant. But a closer look reveals it drastically shifts the ethical load.

 

Arbonne's Traditional Business Building System
Group Presentations & One-on-Ones
Green Arrow Green Arrow Green Arrow Green Arrow
Sponsor signs up new Consultant for $109. New Consultant books Presentations New Consultant holds Presentations Sponsor & New Consultant become successful & both earn income.
This chart shows the traditional business building process where the Sponsor signs up the new Consultant, helps him/her book and hold the presentations. Only after the Sponsor helps the new Consultant through steps one, two and three and the new Consultant becomes successful, is Sponsor compensated.

 

Arbonne's Results Business Building System
Results Approach
Orange Arrow Red Arrow Green Arrow
Sponsor signs up new Consultant for $109 plus Result Kits. Sponsor gets paid on income from Result Kits. New Consultant books Presentations New Consultant holds Presentations New Consultant becomes successful & earns income from sales.

This chart shows how the purchase of Result Kits at sign-up allows the Sponsor to be compensated before the new Consultant is successful. This shift in sequence causes a delay between sign-up (red arrow) and the success of the new Consultant (green arrow). This shift and subsequent delay shifts the ethical load. What fills this void in this delay?

 

Results Approach Training:
The following is taken from a Results Approach training:

  1. Sign Up:  $109 U.S. Consultant Registration Fee
  2. Place Order: Personal Product & Business Tools (2, 4, 6 or 8 kits)
  3. Set Up Auto Ship: Minimum $150 RV/QV For Active Status

Notice that Step #2 has both "Personal" & "Business Tools" in the order. That is because in order for a new Consultant to start her business using the Results Approach, she must purchase Result Kits. Since Result Kits are comprised of RE9 sets the Result Kits have retail volume attached to them. So at the moment these Result Kits are purchased by the new Consultant, the Sponsor is paid on this volume just as if they had been sold to a client.

An even greater issue is the Sponsor gets paid on the volume from these Result Kits even if the new Consultant can never move the kits or create volume sales them. So this "simple" shift in sequence" changes everything.

This shift is similar to what happens in the shopping example above. When the time span between payment and the delivery of the product shifts creating a delay, this also shifts the risk and the ethical load. As a result additional procedures are implemented to provide legal safe guards and realign the risk and thus the ethical load.

Ethical Shift Impacts "Ends" Verses "Means to an End":
In Arbonne's traditional system, because the Sponsor is only compensated as the new Consultant becomes successful, this forces the Sponsor to treat the new Consultant as an "ends in themselves".

But in the Results Approach, because the compensation comes before the new Consultant is successful, this shift in sequence allows the Sponsor to treat the new Consultant as a "means to an end".

As Immanuel Kant wrote:

"Act in such a way that you treat humanity, whether in your own person or in the person of any other, always at the same time as an end and never merely as a means to an end." (Kant, Immanuel; translated by James W. Ellington [1785] (1993). Grounding for the Metaphysics of Morals 3rd ed.. Hackett. pp. 30. ISBN 0-87220-166-x.) 

Safe Guards to Close the Ethical Void in the Results Approach:
In the store example above, when there is a change or a delay in the sequences and it increases the risk in the system, additional safe guards must be implemented to keep the process ethical. The same is true with the shift in sequences in the Results Approach. The delay in the sequence opens a void in the Results Approach that can shift events from ethical to unethical. As a result, safe guards must be implemented to close this void in order to keep the Results Approach ethical.

What safe guards would close this void?

  1. 45 Day Money Back Guarantee
  2. Buy back Result Kits (this is recommended by the DSA)
  3. Result Kits Testers that are business building aids (this removes the retail volume from the Kits)

Let’s examine each of these.

45 Day Money Back Guarantee:
Some Sponsors actually attempt to use the 45 Day Money Back Guarantee to reduce the risk to the new Consultant. They tell new Consultants that if they cannot move the product within 45 days they can return it to Arbonne. The 45 Day Money Back Guarantee was intended to eliminate the risk to the consumer who was ordering online and receiving their product days later. If the product caused a reaction, this policy allows the customer a full refund. It was never intended to be used by Consultants to reduce their risk of building the business. To use the 45 Day Money Back Guarantee in this way is unethical. Thus this is not a viable solution.

Buy back Result Kits (this is recommended by the DSA):
Another way to resolve this risk is for the Sponsor to offer to buy back the Result Kits if the new Consultant cannot sell them or generate sells with them. But this creates such a huge upfront financial exposure to the Sponsor that it makes building the business via the Results Approach too risky. As a result, those Consultants who use the Results Approach withhold this option which is very interesting. If the Results Approach is as good a business building system as the proponents claim it is, then they should not hesitate to offer this. The reason they don't is because it would be too difficult to sign up new Consultants if they are exposed for the total dollar amount of the Result Kits.

An interesting fact about the buy back is, the DSA recommends this procedure to prevent pyramid scheme and protect prospects from this risk. Why? Because the buy back process places the Sponsor at risk rather than the new Consultant. As a result the Sponsor will be less inclined to push the new Consultant into purchasing product that according to the averages cannot be moved. See my posts on this topic at:

  1. The Ethical Dilemma Caused by the Arbonne Results Approach
  2. Options to Make the Arbonne Results Approach Ethically Viable
  3. Ethical & Unethical Use of the Arbonne Results Approach

Result Kits Testers that are business building aids (this removes the retail volume from the Kits):
The final option is the only ethically viable one. To offer Result Kits that have no retail volume attached to them. This way when a new Consultant is signed up and places their personal and business tool order, the Sponsor would not be compensated at that moment in time. The Sponsor would only be compensated when the kits are sold to clients or clients order their own product.

This would eliminate the temptation for Sponsors to have their new Consultants front load. With no retail volume attached to the Result Approach Testers, there is no compensation, and thus no incentive to push Result Kits.

In addition to the above, the elimination of compensation also takes away the incentive to treat New Consultants as a means to an end (retail volume) rather than as an ends in themselves (a potential business builder the Sponsor will be paid on as the Sponsor trains the new Consultant to be successful).

Unlike the DSA's buy back procedure, the "Testers", rather than being a safety fall back procedure, totally elimnates the possibility of up front loading. Here, for the first time those who use the Results Approach could say, "we become successful, when we make you successful" and this would be a true and accurate statement 100% of the time. Only here can the Results Approach treat all as an Ends rather than a Means to an End. In this the Results Approach is finally ethically pure.  

 

© 2010, VoiceWind. . .Greg Loveless. All rights reserved.

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Strained Logic in L.A. Times Article “Fear of Immigration Law in Arizona”

The L.A. Times's article "Immigration law ignites fear in Arizona" reports on a new state law in Arizona that requires public workers to report illegal immigrants who apply for benefits they aren't entitled to.

The article implies that the law is unjust because immigrants hesitate to seek assistance from state agencies for fear their illegal status will be reported. It concludes by providing the following story and the thoughts of Sofia Machado.

"The state Department of Economic Services, which administers welfare benefits, has referred to federal authorities more than 750 people who applied for benefits without proof of legal residency. Officials at ICE have not said whether they have taken action on those cases, but stressed that their priorities in deportations lie with violent criminals.

On a recent morning, a group of immigrants sat in the modest offices of the Border Action Network, sharing stories of fearful trips to apply for benefits. Sofia Machado, an English teacher and volunteer at the group, said one of her neighbors had been deported after seeking Medicaid for her U.S.-born children.

Just as Machado finished telling the story, her cellphone rang. The caller's daughter was three months pregnant and had started bleeding, but the caller feared taking her to the hospital. Machado tried to reassure the caller that hospitals should not be checking immigration status."

Following this the strained logic occurs. Referring to the effects of the law on illegal immigrants Sofia is quoted as saying, "Look at the disaster these people have created."

There were many a day when I was young I would wait anxiously for my dad to come home from work so we could play catch. And then there were those days when my brother and I, as young boys are apt to do, would commit a transgression out side the normal boundaries of civility that would bring our mom to say, "Wait until your father gets home!".

On those days I feared the arrival of my dad at the end of the day.

So what changed? Not my dad. And not the rules. What changed was my position as it related to being within our outside "the law". 

Although my dad caused the fear, I owned the fear.

Likewise, there is nothing wrong with the law. Neither is there anything wrong with those who support it. Although the law causes the fear, the illegal immigrants own the fear.

Why? Because they are illegal. As such, they stand outside the law.

Click here to view the L.A. Times Article "Immigration law ignites fear in Arizona".

© 2010, VoiceWind. . .Greg Loveless. All rights reserved.

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