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Old October 13th 05, 02:24 AM
 
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Default Another sweetheart deal?

Executive Board Caves to ChessCafe

The USCF Executive Board has caved to the
ChessCafe. That is the report I received from a source.

By a 5-1 vote the EB has decided WITHOUT
OFFERING A PUBLIC TENDER to alter favorably for the
Cafe the terms of its contract and to extend the
Cafe's sales agreement until 2012. Further, the Cafe
will have over $100,000 of its $250,000+ debt to
the USCF forgiven.

One of the signs of a sweetheart contract is
when the side failing to fulfill the terms has the
contract altered to its advantage without reoffering
the contract for PUBLIC TENDER. Another sign of such
a contract is when it is extended for several years,
thereby locking the debtor into a position offering
still more leverage. Finally, the Cafe will NOT be
required to repay the USCF from profits it has made on
the sales franchise deal or from future profits.

IT DOES NOT GET ANY SWEETER THAN THAT, FOLKS
-- if my source is correct. You get your debt forgiven now,
and you never have to make it good in the future from profits.

If true, it is sugar sweeeeet!

Under the new terms of the contract, if my
source is accurate, the Cafe will be required to
provide an annual subvention of $150,000, less than
half the previous figure of $350,000. That may mean
the Cafe's percentage contribution will be about 40%
of its successful bid in 2003. This deal has been made
without reopening the sales franchise for PUBLIC TENDER.

I am told that Grant Perks conducted an audit
of the Cafe, but we do not yet know the results. It
appears that portions of the Cafe's sales program that
bring in profits were outside the deal with the USCF.
My sources states that profits from these sales need
not be used by the Cafe to repay its debt to the USCF.

About 22 months ago, book and equipment sales
were put at about $2.7 million. The new Cafe
requirement is to subvent only $150,000 annually. The
profits made by the Cafe from this sweetheart deal
need not be paid by the Cafe to retire its debt.

I am told that the EB feared that Hanon
Russell, who has been described as a reputable lawyer,
might declare bankruptcy, stiffing right up the nether
region those to whom he owes money.

THE BOTTOM LINE: The Cafe, if the report I
received is accurate, has a lock on Federation B and E
for the next seven years. By that time, there will no
longer be any wherewithal in the Federation to
resuscitate a once successful sales program, and there
will likely no longer even exist the capability of
putting the B&E franchise up for competitive bidding.

Near total silence now emits from the USCF
Executive Board. I know that many Delegates read both
this site and the fidechess group where I will also
post this report. One hopes that questions will be
asked and attacks eventuate that will sting, if the
report I received is accurate.

My source, if correct, paints a picture in
which the ChessCafe, a debtor delinquent, has received
a reward -- not a punishment -- for threats to declare
bankruptcy and for failure to fulfill a contract.

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Old October 13th 05, 06:09 AM
Tom Klem
 
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Please forgive me for appearing to defend the Chess Cafe and Hanon Russell.
That is not the intent of this posting.

You mention, Larry, that sales of the old B&E were at 2.7M and now we will
only get a guarantee of $150,000.00. You never mentioned expenses accrued
from the B&E albatross.

I'm sorry to inform you of this, but Gross Profits from a particular
department are NOT contributions to bottom line, which if memory serves was
in the red near to half a million dollars. In other words, the B&E was
hemorragning cash out of our USCF at an alarming rate. And, while it is
obvious that there are plenty of better businessmen in the B&E business, who
actually keep their word and pay off when they promise (unlike, apparently,
Chess Cafe), the others were frozen out of the bidding process by none other
than the illustrious reigning tyrant, Bill Goichberg.

How did he do that? Exactly as Larry suggests, by constructing a deal which
whether CC or Goichberg knew the truth or not, amounts to exactly what Larry
says here. A sweetheart deal. It is my considered opinion that these fellows
missrepresented, or went ahead with estimates having no foundation in fact,
to schmooze the board into acceptance, without considering all factors.

That is truly stupid, I admit, however, we are not on the losing end
financially ... yet.

Adding to the bottom line at USCF means, for the accountancy challenged, a
department's gross profit minus expense is in the black, and unless we have
another round of this backsliding next year, should Chess Cafe appear hat in
hand once more (or, bankruptcy scythe at his side), we will not be failing
from a lack of financial perspective, or cash flow.

On general principles, I agree with Larry that blackmail (oh what an ugly
word), should never be allowed to enter into a business arragnement.
However, from a practical viewpoint, at least in today's world, it always
seems as if the one dealing from the weaker position, kneels before his
betters.

And one other thing that I would like to point out here. Maybe Hanon Russell
is not even running the Chess Cafe himself, but through managers and
surrogates who mislead him and the board. We must entertain the possibility
(no matter how remote), that eager subordinates caused this disaster and
smudge on Chess Cafe's reputation. (sic)

Since wherever the latest USCF board goes, an information blackout is
enforced, it is difficult to say. That is why our organization has a ballot
box.

Perception and reality may be the same thing, but lacking substantial proof,
I would be loathe to make such charges in public. The ballot box, on the
other hand, has nothing at all to do with reality. As we have seen in the
past at USCF and elsewhere.

--
Tom Klem

Keep your eyes on the prize! Solvency!







wrote in message
oups.com...
Executive Board Caves to ChessCafe

The USCF Executive Board has caved to the
ChessCafe. That is the report I received from a source.

By a 5-1 vote the EB has decided WITHOUT
OFFERING A PUBLIC TENDER to alter favorably for the
Cafe the terms of its contract and to extend the
Cafe's sales agreement until 2012. Further, the Cafe
will have over $100,000 of its $250,000+ debt to
the USCF forgiven.

One of the signs of a sweetheart contract is
when the side failing to fulfill the terms has the
contract altered to its advantage without reoffering
the contract for PUBLIC TENDER. Another sign of such
a contract is when it is extended for several years,
thereby locking the debtor into a position offering
still more leverage. Finally, the Cafe will NOT be
required to repay the USCF from profits it has made on
the sales franchise deal or from future profits.

IT DOES NOT GET ANY SWEETER THAN THAT, FOLKS
-- if my source is correct. You get your debt forgiven now,
and you never have to make it good in the future from profits.

If true, it is sugar sweeeeet!

Under the new terms of the contract, if my
source is accurate, the Cafe will be required to
provide an annual subvention of $150,000, less than
half the previous figure of $350,000. That may mean
the Cafe's percentage contribution will be about 40%
of its successful bid in 2003. This deal has been made
without reopening the sales franchise for PUBLIC TENDER.

I am told that Grant Perks conducted an audit
of the Cafe, but we do not yet know the results. It
appears that portions of the Cafe's sales program that
bring in profits were outside the deal with the USCF.
My sources states that profits from these sales need
not be used by the Cafe to repay its debt to the USCF.

About 22 months ago, book and equipment sales
were put at about $2.7 million. The new Cafe
requirement is to subvent only $150,000 annually. The
profits made by the Cafe from this sweetheart deal
need not be paid by the Cafe to retire its debt.

I am told that the EB feared that Hanon
Russell, who has been described as a reputable lawyer,
might declare bankruptcy, stiffing right up the nether
region those to whom he owes money.

THE BOTTOM LINE: The Cafe, if the report I
received is accurate, has a lock on Federation B and E
for the next seven years. By that time, there will no
longer be any wherewithal in the Federation to
resuscitate a once successful sales program, and there
will likely no longer even exist the capability of
putting the B&E franchise up for competitive bidding.

Near total silence now emits from the USCF
Executive Board. I know that many Delegates read both
this site and the fidechess group where I will also
post this report. One hopes that questions will be
asked and attacks eventuate that will sting, if the
report I received is accurate.

My source, if correct, paints a picture in
which the ChessCafe, a debtor delinquent, has received
a reward -- not a punishment -- for threats to declare
bankruptcy and for failure to fulfill a contract.



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Old October 13th 05, 07:12 AM
 
Posts: n/a
Default

HOW SWEET IT IS....

To be an insider.

Imagine, if you will, GM Larry Evans in a similar situation. Is it
imaginable that there would be any such solicitude shown to GM Evans if
he were in heavy debt to the Federation, as is Hanon Russell, because
of his own doing? Is it imaginable that GM Evans would receive not
only debt forgiveness but a REWARD for his failures to deliver?

I think not. The piranha would be tearing at the Sage of Reno's
financial flesh.

  #4   Report Post  
Old October 13th 05, 08:29 AM
Tom Klem
 
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Default

Well, I have imagined that. So I ask you, why would GM Larry even want a
piece of that maelstrom?

Point is, in business, you use suppliers and employees you know.

La Goich and company are running things. Let them.

Now, when it comes to the ballot box, perception is your best friend.

Ah, weren't you in favor of the Goich slate?

I just can't remember anymore

Tom Klem

wrote in message
oups.com...
HOW SWEET IT IS....

To be an insider.

Imagine, if you will, GM Larry Evans in a similar situation. Is it
imaginable that there would be any such solicitude shown to GM Evans if
he were in heavy debt to the Federation, as is Hanon Russell, because
of his own doing? Is it imaginable that GM Evans would receive not
only debt forgiveness but a REWARD for his failures to deliver?

I think not. The piranha would be tearing at the Sage of Reno's
financial flesh.



  #5   Report Post  
Old October 13th 05, 01:53 PM
cynic
 
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Default

It doesn't seem to matter who's in power. They all make the same
arrogant mistakes.



  #6   Report Post  
Old October 13th 05, 02:04 PM
Taylor Kingston
 
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Default


Tom Klem wrote:
It is my considered opinion that these fellows
missrepresented, or went ahead with estimates having no foundation in fact,
to schmooze the board into acceptance, without considering all factors.


Tom, allow me to suggest an alternate possibility: that when the
initial bidding and negotiations for the B&E outsourcing were under
way, USCF presented inaccurate, overstated past sales figures, either
by error or intent. With bidders assuming unduly high sales
projections, the final terms would have been unrealistically favorable
to USCF.
In that case, it seems to me it would be incumbent on USCF to
renegotiate the terms. Which, it appears, they have done.

On general principles, I agree with Larry that blackmail (oh what an ugly
word), should never be allowed to enter into a business arragnement.


Tom, by now you should know that in Parr's Distorted Dictionary, a
word's meaning shifts depending on the person to whom it refers. A
responsible critic who validly pans an author Parr likes is a vicious
hatchet-man, while a raving loonie who unfairly pans an author Parr
dislikes is an outspoken chess enthusiast. Similarly, a business deal
Parr approves of must have been reached by fair negotiation, while one
he dislikes must have involved blackmail or other under-handed
skullduggery.

  #7   Report Post  
Old October 13th 05, 02:20 PM
Tom Klem
 
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Default

Yes, I agree with your possibility as well.

We simply do not know the ethos or dynamics involved at either personal or
business level.

The balance sheet will tell the tale, assuming that we see an honest
representation of reality. Often times, Enronian accounting methods flood
the precambrian mind set of the accounting staff, instinct takes over, and
red ink spills from our veins. We are told that red is the "in" color this
year, slapped silly (we are told that rough sex is in this year), and moved
along like a herd of goats.


--
Tom Klem

"What's that humming?"
---Susan, "What Planet are you from?"


"Taylor Kingston" wrote in message
oups.com...

Tom Klem wrote:
It is my considered opinion that these fellows
missrepresented, or went ahead with estimates having no foundation in

fact,
to schmooze the board into acceptance, without considering all factors.


Tom, allow me to suggest an alternate possibility: that when the
initial bidding and negotiations for the B&E outsourcing were under
way, USCF presented inaccurate, overstated past sales figures, either
by error or intent. With bidders assuming unduly high sales
projections, the final terms would have been unrealistically favorable
to USCF.
In that case, it seems to me it would be incumbent on USCF to
renegotiate the terms. Which, it appears, they have done.

On general principles, I agree with Larry that blackmail (oh what an

ugly
word), should never be allowed to enter into a business arragnement.


Tom, by now you should know that in Parr's Distorted Dictionary, a
word's meaning shifts depending on the person to whom it refers. A
responsible critic who validly pans an author Parr likes is a vicious
hatchet-man, while a raving loonie who unfairly pans an author Parr
dislikes is an outspoken chess enthusiast. Similarly, a business deal
Parr approves of must have been reached by fair negotiation, while one
he dislikes must have involved blackmail or other under-handed
skullduggery.



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Old October 13th 05, 04:35 PM
 
Posts: n/a
Default

TRANSPARENCY

Ah, weren't you in favor of the Goich slate? -- Tom Klem

Dear Tom,

I favored, if you will recollect, a split board
in favor of the Goichberg slate, 4-3, though without
Bill himself. You will recollect that I supported
George John and then favored the election of Joel
Channing, Greg Shahade and Sam Sloan to join Schultz
and Marinello.
..
Basically I wanted a closely divided Board in
the belief, as I wrote repeatedly at the time, it was
the best hope for keeping some transparency and
battling going. Quiet agreement has been the horror
of USCF governance.

  #9   Report Post  
Old October 13th 05, 05:02 PM
Tom Klem
 
Posts: n/a
Default

And, you actually thought that Bill would not ride triumphantly on a Sloan
to Crossville when he was elected as President?

1st, they hold the phony election. Everyone who has an axe to grind votes.

Then they say, "no we didn't really mean it", and only the Goichbots vote.

What we have here ... is a failure to communicate.

You honestly believed then that Goichberg would take your advice (for your
support), and not become an officer because of the transparent conflict of
interest?

Tom Klem
"Be careful what you wish for"



wrote in message
ups.com...
TRANSPARENCY

Ah, weren't you in favor of the Goich slate? -- Tom Klem

Dear Tom,

I favored, if you will recollect, a split board
in favor of the Goichberg slate, 4-3, though without
Bill himself. You will recollect that I supported
George John and then favored the election of Joel
Channing, Greg Shahade and Sam Sloan to join Schultz
and Marinello.
.
Basically I wanted a closely divided Board in
the belief, as I wrote repeatedly at the time, it was
the best hope for keeping some transparency and
battling going. Quiet agreement has been the horror
of USCF governance.



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Old October 13th 05, 05:30 PM
 
Posts: n/a
Default

PARR'S DISTORTED DICTIONARY

It is my considered opinion that these fellows
missrepresented, or went ahead with estimates
having no foundation in fact, to schmooze the board
into acceptance, without considering all factors. -- Tom Klem

Tom, by now you should know that in Parr's Distorted
Dictionary, a word's meaning shifts depending on the person to
whom it refers...Similarly, a business deal Parr approves

of must have been reached by fair negotiation, while one he
dislikes must have involved blackmail or other under-handed
skullduggery. -- Taylor Kingston

NM Taylor Kingston, the 1800-rated but
self-proclaimed 2300+ ELO Titan, has evidently
returned to rgcp after telling us how much he enjoyed
not being here. Ah well, the gent does talk like that.

NM Kingston's suggestion that the USCF inflated
sales numbers is obscene. There was a public record
that provided sales numbers for years, and any
businessman could have worked out the trends for himself.

The bottom line: ChessCafe will not have to
repay its debt from future profits. That is a sweeeeet
deal indeed for the Cafe, and it's no surprose that one
of Hanon Russell's subordinates approves of it.

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