The Takeover

by Stephen W. Frey

  “Thank you, Mr. President.” Winthrop paused as he surveyed the men before him. “To your good health, gentlemen.” The senior partner brought the glass to his lips and continued to drink until the pale golden liquid was completely consumed.

  The rest of the partnership followed suit, every man standing until the last glass was empty. Then the men sat and waited as the white-gloved attendants refilled the glasses.

  “Fellow partners, I will not take a great deal of your time tonight. I know that you are much more interested in the contents of what lies beside me than in what I have to say”—Winthrop gestured toward the seventy-six sealed envelopes stacked neatly on a sterling silver tray atop a stand next to the podium—“but I feel compelled to say a few words before I distribute the envelopes.”

  The partnership shifted uncomfortably in its seats. There was an ominous tone to Granville’s voice.

  “As you all have just heard, profits were down this year. And remember”—Winthrop paused for effect—“your personal cash flow will be cut significantly because of the high tax rates on the so-called wealthy the new administration has been able to ramrod through Congress.”

  The appropriate grumble rippled through the room at the mention of high taxes.

  Winthrop continued. “Still, the profit decrease is an unacceptable development, even in the face of a difficult economy. A completely unacceptable development.”

  Here it came. The partners were suddenly on the edge of their seats again, particularly the middle-aged men who had experienced the last cleansing in 1981. Six men had received the Sanction that year.

  “In addition to the decline in profits, we had other extraordinary cash needs. We completed the renovation of our offices. We installed several state-of-the-art computer systems. And we purchased the money-management firm of Bates, Hilger in July. And since we decided, as a firm, not to allow any of Bates, Hilger’s senior managers to become partners here at Winthrop, Hawkins, we were forced to pay the purchase price completely in cash. In the long run that acquisition will pay off handsomely for us. We should thank our newest partner, Mr. Falcon, for initiating and negotiating the purchase on our behalf.” Granville nodded in Andrew’s direction.

  Immediately Falcon’s gaze dropped to the tablecloth. He sensed the eyes of the partnership upon him. He knew that not all of the men approved of the transaction, primarily because it took money out of their pockets in the current year.

  “All of these developments have used cash. Therefore, gentlemen, do not be surprised if your bonuses are lower than last year. We on the Management Committee have been extremely discriminating, and we have rewarded your efforts based solely upon performance—something we have drifted away from in the past because of our robust earnings.”

  It was as if a strong riptide had suddenly swept through the room. The men held tightly to the meat-stained tablecloths, their clenched knuckles turning white. Their faces became grave, giving away the great strain each felt.

  Granville nodded to the waiters, who quickly picked up predetermined sets of the envelopes and distributed them with speed and precision to the appropriate recipients.

  Falcon stared at the plain cream-colored envelope set before him on the tablecloth. Neatly typed on the front of the envelope was simply his name—at least the name he had given to Winthrop, Hawkins seven years ago, the one he had given to Harvard Business School two years prior to that, and the one he had given to the University of Pennsylvania four years before that. Andrew William Falcon. Not his name by birth.

  Life, as everyone on Wall Street knew, came down to a few vitally important seconds. Moments when all of the research and preparation either paid off or didn’t. When the deal was won or lost. This was one of those moments.

  Falcon inhaled deeply, terribly conscious of his breathing. Despite the alcohol’s effect, his senses were suddenly aroused, and he was aware of every movement in the room. The adrenaline coursed through his body.

  Light-blue Tiffany boxes had been positioned next to each partner’s place setting since the beginning of dinner. In the box was a sterling silver letter opener engraved with the partner’s name and the date—a date which would live in each man’s memory forever, positively or negatively. Some of these men could barely remember their wedding days, but these dinners remained vivid in their memories.

  Falcon reached for the box next to his unused dessert fork, removed the letter opener, and slid its protective blue felt covering from the polished silver. He stared at the opener for a moment. Then, deliberately, he turned the envelope onto its face, positioned the sharp point of the instrument into the slightly lifted back flap, and sliced open the small package. The paper tore neatly, and he was vaguely aware that seventy-five other envelopes were tearing just as neatly at exactly the same moment. Falcon swallowed and removed the contents—nothing more than a small piece of paper upon which again was typed his name, and just beneath, a number. His eyesight blurred slightly as he attempted to focus on the figures. Blood pounded in his brain. Suddenly his senses numbed. One million dollars. He blinked and stared at the figure again. A million dollars!

  It was more money than some people earned in a lifetime. More money than his father, a foundry worker still living in a dingy row house in west Philadelphia—the same row house in which Falcon had been raised—could possibly imagine. It was not the five million he had calculated as each non-Management Committee partner’s share of the firm’s net income, but after all, he was only a first-year partner, the firm had incurred other cash flow requirements this past year, and some capital had to remain with the partnership to support future growth. There were senior partners at New York’s most prestigious law firms not earning bonuses as grotesque as this—men and women who had been working at the law for decades. It was a huge amount of money for a man barely thirty-one. It was a huge amount of money for any human being.

  But he felt no guilt over the amount of the bonus. It was deserved. The Management Committee had paid him this much because he was good. No, not just good. Very good. They paid him this much because he could instantly captivate a room of corporate executives with the burning stare, the smooth voice, and the tremendous knowledge of finance, tax law, and accounting he possessed. Because he had an innate, uncanny ability to sense value where others did not. And because he made the firm a tremendous amount of money—forty times the bonus amount. They had paid him this much because they wanted to keep him. There had been no reason to think he might not receive the huge bonus, especially given his relationship with Granville.

  Falcon became suddenly calm. The calm for which he had already become famous at Winthrop, Hawkins. The elation subsided. A million dollars was acceptable, but he wanted more. Much more. And he wanted it quickly.

  “You goddamn bastards!” Kunkowski roared to his feet. The wing back chair crashed loudly against the panelled wall as the man rose.

  Falcon turned his head quickly as Kunkowski yelled, index finger extended toward the head of the table. By now Winthrop had returned from the podium to his seat at the head of the table.

  “You sons of bitches!” Kunkowski screamed. He was obviously drunk.

  Falcon shot a quick glance at the paper before Kunkowski’s seat. There was no number beneath the man’s name. He had received the Sanction. So the sharks had attacked after all.

  “You think you can do this to me? You think you can play with me like some toy?” The room was deathly still. Through glazed eyes Kunkowski stared at Granville.

  Granville motioned to the headwaiter. He seemed to be smiling slightly as he did so, as if he were amused. Or perhaps the smile was simply Andrew’s imagination.

  Kunkowski stumbled around the end of the table where Falcon sat and moved toward Granville. Several of the other senior partners stood as Kunkowski approached, but Granville remained seated, serene as he smoked a huge cigar.

  Kunkowski stopped ten feet short of
the head of the table. He was a big man, almost six-five and solidly built. He used his size to intimidate people—Falcon had seen him do it many times before. Falcon disliked people who behaved this way, and he watched with fascination, sensing that this time Kunkowski’s display would not matter.

  “You people have always hated me because I’m Polish and I’m Catholic.” Kunkowski’s voice was suddenly hushed. “You detest minorities.”

  “That is absurd.” Granville continued to suck on the cigar. “You know very well that this gentleman on my right, Ben Weingarten, president of our firm, is Jewish.”

  “Half Jerish.” Kunkowski slurred the word.

  “You are very drunk, Mr. Kunkowski. Sit down.” For the first time there was a hint of anger in Winthrop’s voice.

  It was good advice, Falcon thought. He scanned the faces in the partnership quickly and identified three others, including Roland Thompson, who had clearly received the Sanction also. Their dazed expressions revealed what they desperately tried to hide. But these three did not have Kunkowski’s courage—or his stupidity. They sat riveted to their seats. It was foolhardy to confront the Management Committee. Once the Sanction had been decreed, the decision was never altered. You could continue working at Winthrop, Hawkins for as many years as you wished, drawing the same one-hundred-thousand-dollar salary every partner drew, but you would never again receive a bonus. And one hundred thousand dollars wouldn’t keep most of the partners’ wives in clothes for a year, let alone meet debt service on the houses, cars, boats, and jewelry which had been purchased on margin. And if you complained or insulted the Management Committee, they could make repurchase of the partnership interest very difficult, stretching out the repurchase period over many years and negotiating and renegotiating the purchase price downward as you needed the cash. It was better to go quietly, collect the cash for your partnership interest quickly, and catch on with another, less prestigious investment bank.

  “No, I’m not going to sit down. I’m not going to go quietly as you want me to do!” Kunkowski turned to the rank-and-file partners. “Come on. Who else just had a red-hot poker stuffed up his ass? I know I’m not the only one.”

  The three men with the ashen faces whom Falcon had identified moments before could not meet Kunkowski’s gaze. Everyone else in the room stared straight back at him. Falcon congratulated himself on his ability to read a man’s expression, but he was not surprised by this ability. After all, he had funded a great deal of his undergraduate living expenses with poker winnings.

  “Please, you have to be with me. If we stick together, we can fight these bastards.”

  There was no response.

  “Please…”

  Still nothing.

  Suddenly Kunkowski realized that he had made a critical error in judgment with his emotional, knee-jerk reaction. The shoulders of the large man slowly slumped as he turned back toward the senior partners. They stared back and Falcon could sense the hatred. No one addressed the Management Committee as Kunkowski had. They were gods. And they were not forgiving gods.

  For a moment Kunkowski gazed at Granville through bloodshot eyes and then brought both hands to his face. The room was deafeningly silent except for Kunkowski’s sobs, and the faint sound of Granville exhaling cigar smoke.

  Four large security guards, there as a result of Granville’s motion to the headwaiter several minutes before, broke the silence as they moved into the room. But they were unnecessary. Kunkowski was a beaten man.

  And Falcon watched him completely disintegrate.

  * * *

  —

  Granville Winthrop sat alone in a small private room on the fourth floor of the Racquet Club overlooking Park Avenue. He watched the headlights of the cars passing beneath the window as he smoked his third cigar of the evening. New York City seemed so peaceful at this time of night, especially under the light snow that was beginning to fall.

  Falcon hesitated at the doorway. This wasn’t going to be easy. Perhaps it should wait until Monday. He took a step away from the door.

  “Come in, Andrew,” Winthrop said quietly. “Close the door behind you.”

  Too late. At seventy-one Winthrop’s senses remained sharp. Even after the immense amount of alcohol, the old man didn’t miss a trick. Falcon took a deep breath and stepped into the room. The bonus envelope was safely stored in the inside pocket of his tuxedo jacket.

  “So what did you think of your first partners’ dinner?”

  “Interesting. Ah, a rather difficult evening for Mr. Kunkowski and a few others.” The door clicked shut.

  “Yes, but necessary.” Granville’s tone became measured. He did not want to discuss Kunkowski. As far as he was concerned, Kunkowski might as well be dead. “Satisfied with your bonus, Andrew?” Granville’s voice was subdued, but his eyes danced.

  Falcon’s eyes dropped to the deep blue carpet of the room. That was Granville, direct as hell. “Of course. My God, it’s more money than some people earn in a lifetime.” He thought of his father in the old two-story row house. He was probably sitting in front of the black-and-white television set at this very moment, watching an old movie, covered in blankets because he did not have the money to keep the heat in the drafty house above sixty degrees in the winter.

  “There’s more where that came from. Lots more.” Granville waved his hand as if a million dollars were pocket change. “I tried to get you another five hundred thousand, but the other members of the Management Committee wouldn’t go along. The firm bears my name, but I have to play politics sometimes.” He paused and snorted as if this was the worst part of his job. “It’s almost double what any first-year partner at Winthrop, Hawkins has ever received.” Granville paused again. “But you deserve it. Every cent.” His voice hissed, as if recalling the unpleasantness of the argument with his fellow Management Committee members over the amount.

  “I can’t tell you how much I appreciate it.” Falcon shifted uncomfortably as he stood before Winthrop.

  The old man stared at his young star. “I shouldn’t tell you this, Andrew.” Granville glanced out the window at Park Avenue and then back. “You remind me a great deal of myself when I was young. Brilliant, aggressive, intimidating, and, of course, undeniably a lady’s man.” Winthrop smiled widely, the lines of his face creating perfectly defined grids on either side of his mouth. “In all the weekends you have come to the estate, I don’t think you’ve ever brought the same woman.”

  They laughed together, more loudly than was necessary. Not at Winthrop’s attempt at humor, but because both men were suddenly uncomfortable with Winthrop’s admission of his affection for Falcon. Men like Winthrop rarely made such admissions.

  He drew in a deep breath. “You could become senior partner here someday, Andrew. Not too far in the future either. It might upset the old guard, but investment banking is a young man’s game these days. The technology is passing us old men by. We’re still feeding off of the relationships with clients this firm has had for a hundred years. That will continue to pay dividends for a while, but at some point we’ll need more. We’ll need you.”

  Again Falcon glanced at the floor.

  “I’m making you uncomfortable, Andrew. I know that. It’s the liquor talking—and the evening in general. It’s pretty heady stuff for the firm to make almost six hundred million dollars in one year. Especially when just under half of that is mine.”

  Falcon’s eyes rose immediately from the carpet. So Granville still owned that much of the partnership. Incredible.

  The two men stared at each other for several moments, stone-faced. Then Granville’s visage again broke into a wide, unguarded smile. “Anyone left downstairs, Andrew my boy?”

  Falcon shook his head. He appreciated the fact that Granville always addressed him by his first name. Everyone else at the firm called him Falcon. Instinctively, it seemed. “No. They’re all gone. It’s three o’cloc
k.”

  “Which of course leads me to my next question. What are you doing here?”

  “I don’t know. Just felt like hanging around, I guess. Didn’t want to leave.”

  “Andrew, I’ve never known you to simply hang around. You are not one to waste time. You are too driven. It will be your undoing someday. I sensed your aggressiveness during the first three minutes of our interview at Harvard Business School, which is, of course, why I hired you. Every one of your actions has purpose. There is a reason for everything you do. There is a reason that you are the last person here.”

  Falcon eyed the older man. For the past four years Granville had been his mentor and friend, the closest thing to a father Falcon had experienced in a long time. And suddenly, despite the fact that Falcon was far from sentimental, he realized that he would miss Granville Winthrop. But Granville would understand. They would always be good friends.

  “I am going to leave this firm.” Falcon knew no other way than to be direct. It was his nature, just as it was Granville’s. He searched Winthrop’s face for a reaction, but there was none. He continued, uncomfortable at Winthrop’s initial indifference. “I have an opportunity. An entrepreneurial opportunity. My partner and I have developed a software we believe will have widespread application in the health-care field. It’s a potential economic windfall.”

  The guarded smile suddenly overtook Winthrop’s face. “A million dollars in one night is not enough?” he asked quietly.

  Falcon ignored Granville’s remark and began to speak more quickly. The guarded smile was not a good sign. “It’s a chance for me to run something myself. It’s a chance for me to earn the kind of money you don’t consider trivial. If it does as we believe it will, the company could be worth fifty to sixty million dollars in two to three years. Conservatively fifty to sixty million. Maybe much more. And of course I would select Winthrop, Hawkins to take the company public.”

  Granville turned back toward the window.