Simple Strategy – Stand in entity takes responsibility for certain expenses:

EXAMPLE: Classes of Employees – pays salaries

(e.g. Admin, Sales, Executives, R&D, Advertising)

Consequence: Cost go down – *Non-related Corp; Stand-in absorbs Costs

Client Co. increases earnings – EBITDA Rises – Earnings multiple may rise; at least Totals; EBITDA will be higher ( a number of standins can diversify suppliers)

Standin might get equity share or secure preferred position as a supplier

Acquisition sold (bought by O/S for peanuts)

Transformation after hand on to O/S inc.

O/S inc. sells acquisition for higher EBITDA to a 2nd O/S (ChINC.)

2nd ChINC sell Acquisition to USAinc. at Inflated Price to initial sale by Owner.

Higher Earnings maintained for Finance

Can be sold to Investors – with Finance in Place; On Deposit – can be structured