David and I are committed to transparency.  It is one of our key values in creating and running CubeSpace.  There are times when there is a significant personal and professional risk in being transparent, and this is one of those times.  But we are being faced with a decision akin to Sophie's Choice, and we would prefer you hear the news from us rather than through the rumor mill.

The very short story is this: Tuesday we were served with a subpoena from our landlord, US Bank, for court order to effectively evict us from our space for non-payment of rent since March. If a judge grants them this action, we will have no choice but to declare bankruptcy, both on behalf of CubeSpace, and almost certainly personally as well. Our court date is Wednesday, and there is a holiday weekend between, which shortens an already tight timeline. We continue to try to work out a solution which is amenable to US Bank and which is workable for us. Based on our efforts to negotiate a solution over the past 10 months, US Bank has made it clear that they are not very interested in our survival. (You will find a more detailed version of our efforts below).
We are reaching out to you, the members of the CubeSpace community, with a glimmer of hope that there is some way to salvage what we have built. If anyone would like to buy a stake in CubeSpace, or even buy CubeSpace outright, now would be the time. We are also open to any other ideas that might avert this catastrophe.
We are in truly desperate straits. It is possible that as of 9AM on Wednesday, May27th, we will be locked out of CubeSpace. We do not believe this to be the most likely outcome, but it is possible. Our timeline is very short, and our options very limited. This is especially frustrating as we are just approaching the point of CubeSpace being self-sustaining financially.  
We are not certain CubeSpace can survive this challenge. We think a bankruptcy claim will make customers adequately nervous that we will not be able to recover financially.  It will also take a lot of time by myself and David. Time that will have to come from managing contracts or managing CubeSpace. Time we simply do not have.

David and I have invested everything we have into CubeSpace: our savings, our investments, our retirement funds, our energy and most of all our hearts.  We are both skilled people and will likely find some way to pay our mortgage.  But the idea of losing CubeSpace and our community is almost more than we can bear. CubeSpace's community was and is more than we could have ever hoped to create.  We are awed by the number of people who shared our vision and we are honored to call you our friends.  You are what kept us going through all of the hard work and financial strain. We could never have gotten this far without you.  

We have no idea what comes next. In the short term, we will continue meeting with lawyers and trying to make impossible decisions.  We will continue to use this blog and twitter for news updates.
For those who would like the fuller story, please continue reading:
The economic downturn hurt us most in the early days of the recession (even before it was officially called a recession).  We did have to do some scrambling, but we communicated with all of the vendors to whom we owed money and made payment arrangements. Generally, the vendors were sympathetic because they were facing similar challenges themselves.

We sent a letter to our landlord, US Bank in August 2008 asking for a rent abatement so that we could get on top on our bills.  We have a 15-year lease with them, and we were under the mistaken impression that they had a stake in us remaining in the space.  They responded in October 2008 with a "no."

We continued struggling along, until February when we had a truly awful month.  We have prioritized paying our employees, taxes and health insurance over everything else. We paid February's rent on the last of our credit cards.  We sent an email to US Bank explaining that we were really out of cash and needed to renegotiate our rent payments. US Bank responded with a letter threatening to come after all of our assets (you know, all of those assets that we sunk into CubeSpace).

In March, we were in the black.  CubeSpace's original model (work and meeting space) were at record levels and the addition of contracting work had made us profitable.  We could even pay partial rent.  David called US Bank's lawyer and proposed a payment plan in which we paid partial rent now, and slowly paid the back rent over the course of our remaining lease.  In other words, we were just asking to rearrange the timing of payments, but they would receive the full amount as agreed to in the original lease. The lawyer said he would speak with the local property manager and get back to us.

We didn't hear back from the bank, but our business continued to grow. We assumed that the bank's lawyers were busy with the TARP funds US Bank had received and managing their own recovery.

Tuesday, May 20, we were served with an FED (Forcible Entry and Detainer), a court action by a landlord to remove a tenant. This was the first response we had received from the Bank since their October 2008 letter.  We are required to appear in Multnomah County Court at 9am on Wednesday, May 27th at 9am.  

We have now spoken with several lawyers who have made our options very clear:
1.    We cross our fingers and hope that the judge recognizes our previous negotiation efforts and requires US Bank to work with us. The alternative is that the judge can direct the Sherriff to lock CubeSpace's door and cut off our access to everything inside. Even other people's property.
2.    We file for Chapter 11 bankrupcy, which prevents us getting locked out, and provides an opportunity for US Bank to either negotiate with us or at the very least, give us time to notify all of our members and return their property. If it turns out the judge is lenient on Wednesday, we don't get to "unfile" the bankrupcy claim.

In gratitude to you all,
Eva & David