Partnership

No Good Deed Goes Unpunished!!

It has been said “Never go into business with Family or Friends” and a truer axiom has never been spoken.  The excitement of emerging new friendships always opens doors to inclusion into new things.  Our new friendship with Kim and Chris was no different at first.  They told us about Lats and Atts being for sale and introduced us to Bob Bitchin.  As things progressed Kim was eager to help in any way that she could and we welcomed it with open arms.  I had found a kindred spirit who was as excited about the prospect of acquiring Lats and Atts and taking it to new heights as I was.  Over the next few weeks we all worked tirelessly to review and analyze the due diligence materials for the company.  At the same time we were brainstorming about what Joe and I would do differently if we were successful in acquiring Lats and Atts.

Things were happening so quickly and we were not ready, not by a long shot. Our original plan was to raise the capital we needed FIRST and then negotiate the purchase.  But as life and Bob Bitchin would have it, decisions had to be made immediately and we bent and twisted to make things work. All of us dove in and worked long hours for nothing and Kim offered to pay for a lot of the due diligence costs because we had not yet secured the financing needed.  We had left the business world over 3 years earlier and were living aboard our boat in Emeryville Marina and no longer had the connections needed.  We had no intention of buying a magazine let alone Latitudes and Attitudes but opportunity knocked and against our better judgment we answered.  Hindsight right?

We traveled to boat shows and worked the L&A booth (at our own expense), we co managed the magazine operation with Bob for months before we purchased the company for no compensation whatsoever.  We all offered our time and effort to help in any way needed without ever asking for anything in return.  All in the name of saving Lats and Atts.  It was now our cause, our purpose and we jumped in wholeheartedly and without reservation or expectation.  (4) Individuals, each with specific skills and all of which were needed desperately in Lats and Atts.

During the Long Beach Boat Show I decided that Kim and Chris deserved to be a part of the new venture.  They had both worked extremely hard without expectation of anything.  At the end of the boat show I offered them each a partnership in the new venture of 25% each.  They were ecstatic and we were happy to have them.  Kim had the best financial resources at the time she offered and indeed bore the burden of most of the due diligence costs.

It was ALWAYS our intention to reimburse her for those up front costs. The negotiations were moving at a very quick pace and we confronted and resolved every obstacle that we encountered.  As we were approaching the Miami Boat Show Bob and I agreed that we would announce the sale to Sextant Publishing.

At first things were great, Kim had made the arrangements for the accommodations and they were awesome.

But things started to surface that were big red flags.  Her relationship with Chris was not as it appeared on the surface.  They squabbled constantly and her insecurity about Chris’s feelings for her caused a high level of tension.  Chris’s apathy toward her emotional state only served to further escalate the situation.  Joe and I tried to stay disconnected from the volatility of the situation.  During the boat show Joe and Kim mingled throughout the show and Kim seemed more concerned with collecting contacts for her company Wicked Code than about building relationships for the new partnership.  In the middle of the show we were informed there was not enough money to cover payroll.  In addition Jim Mather had told the Bookkeeper that he had been working for months with no money and was about to quit.  I made the decision to inject our personal funds into L&A to cover payroll we gave Jim a small amount to help him out.

By the time the show was ending and the announcement of the sale at the cruisers party the tension between Kim and Chris had escalated to the point of them not speaking to each other.  In addition, Kim had begun making decisions without consulting me including paying for things without regard of the broader implications. Things were so precarious with the company that the slightest miscalculation could have enormous consequences and it had now become a real problem.  At first I let it go but as time wore on I realized that she probably was so used to working alone that she needed a reminder of what the partnership paradigm was.

The night of the announcement there was even more drama as one of the exhibitors got into a heated altercation with some L&A staff for hanging banners on their boats and causing some minor damage?  This escalated to threats of violence and after a while, calmer heads prevailed and the party began.  We had worked for weeks preparing for the announcement and had worked out how we would do it and at what point the announcement would be made during the show.  This of course did not happen.  Bob had rushed to announce the sale while we were in the middle of assisting L&A staff selling Tee Shirts and all of us were scattered all over the party venue.  Finally everyone made it to the front and it worked out in the end.   The next day as we prepared to fly back to the west coast we were excited about the future.  We had big plans!

Kim has stated that she was kicked out of the partnership for no reason.  What she doesn’t tell you is that after the St. Pete Boat Show her relationship with Chris was sooo Bad we asked her not to attend the Miami Boat Show because we did not want to deal with a repeat of St. Pete.  She was so emotionally unstable because of her rapidly deteriorating relationship with Chris Larsen that we thought she and Chris could use a break from each other.  Chris was grappling with the chaos of coordinating the remaining boat shows, redeveloping the seafaring store and a plethora of other things. In the weeks after the Miami Boat show Chris had confided in us that he and Kim had multiple volatile confrontations about their relationship with her hitting him and the Police being called to their residence in Point Richmond.  He showed us his bruises where she had attacked him and explained that Kim had had multiple emotional breakdowns and had threatened him repeatedly.

He told us she was drinking heavily during critical decision mileposts and transition periods and repeatedly gossiped to others directly about confidential company information to the detriment of old employees, new employees and other partners the company, including him.  We were approached by Heidi Benson our then Advertising Director and told that Kim had approached her about the lies being told about her.  Heidi told her that everyone was sooo busy and nobody had time to say anything about her.  Heidi sent me an email regarding this and I have included it here as well.

Former and current friends approached us at the Strictly Sail Show and warned us that she had a propensity for destructive gossip but it was her betrayal of confidential information and gossip to Bob and Jody when things were tense and unraveling that was the final straw for us…

Ironically we had just paid her $2,592.70 when we arrived at the Strictly Sail Show Kim Paternoster Payment and were scheduled to have dinner with her later in the week before we discovered that she had betrayed us.

I confronted her about her betrayal and within minutes she had responded with an email filled with vitriol and craziness.

It was amazing to me even now how quickly she could and did turn into another personality and how glad I was that she was no longer part of the partnership…

Her emails, most of which I included here, will give you a keen insight into the broader aspects of her behavior during her time as a partner and shortly thereafter but it is the VM of her screaming at Chris during one of their fights that is most chilling.   There are soooo many reasons why she was removed and any ONE of them would have been cause enough for removal by anyone’s standards.

I have outlined above my abbreviated version of events and how I saw and continue to see them but they do not do the story justice, so I will just let her own words speak for her.

I challenge you to ask yourself, how much would you take if you had to deal with the issues described above during a complex business transaction and what actions would you take.

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