Gambler, Additional questions for the C.C.:
" How will TSIG overcome the tremendous obstacles standing in the way of profitability for it's teleservices business?"
A) In a press release of 2/9/98 TSIG touts Harley Davidson as one of it's clients. We are aware however that on 2/19/98 Harley Davidson filed suit against TSIG seeking judgement for termination of it's contract with TSIG as well as seeking judgement for unspecified damages. We also know that on 4/1/98 Harley Davidson was awarded a default judgement against TSIG leading us to believe that their allegations were true.Additionally we are aware that a hearing date was set by the court for June 12th on the possible awarding of damages in favor of Harley Davidson against TSIG.
1)What was the nature of the dispute and why was Harley
Davidson dissatisfied with TSIG's call management services?
2)What damages does Harley Davidson contend was done to it by
virtue of entrusting TSIG to handle call related services in
it's behalf?
3)What was the result of the June 12th damage hearing?
B)We are also aware that on 3/12/98 Call Management systems inc. filed suit against TSIG alledging "breach of contract" relating to call management services provided by TSIG. Additionally on 3/17/98 Valley Forge convention & visitors bureau filed suit against TSIG alledging "breach of contract" related to call management services as well.
1)What is the specific nature of their complaints against
TSIG's call center operations?
2)Has there been any update to the legal status of these suits?
3)Can we assume that both of these companies are no longer
TSIG clients?
C)In the 10Q filed by TSIG for the 1st qtr. of 98 it states that in addition to the 7 itemized lawsuits contained in the report as well as a number of smaller non-itemized litigation matters that there were also "threatened litigation matters relating to non-performance of contracts and non-payment of various obligations.
1)Have there been any additional suits filed against TSIG since the release of the 1st qtr.10q? If so please elaborate.
2)Do any of the "threaten litigation" matters relate to call center operations?
D)We are aware that TSIG's revenues for the 1st qtr of 98 fell 41% compared to 1st qtr. 97 revenues. This is of serious concern especially in view of the recent lawsuits filed by TSIG clients who claim breach of contract and seek substantial damages against TSIG related to its call center operations. When we consider the drop of revenue in light of the recent litigation it seems apparent that TSIG is losing existing customers at a rate substantially greater then they are replacing them with new ones.
Since the 1st qtr. we have recieved news of only one new customer....Recovery Network. However we have recieved numerous assurances that TSIG will soon be landing major clients including those of the Fortune 500....Please tell us:
1)The expected annual revenues of the Recovery Network contract as well as the anticipated earnings impact.
2)Since we only recieve news of new contracts and new customers through Press Releases please inform us of any other customers who have since 1/1/98 terminated or ceased to use TSIG call management services.
3)In view of the fact that most large companies and especially those of the Fortune 500 are known to conduct extensive research on all potential vendors and even more so on vendors that will be representing them to the public,how does TSIG plan on overcoming:
a)The percieved impact of the litigation against it relating to its failure to perform under its contracted obligations wherein respected companies such as Harley Davidson and others have alledged that they have been seriously damaged by virtue of their decision to allow TSIG to handle its call services operations?
b)Since it is likely that new potential clients will seek out these companies of legal record to discuss first hand the experience they have had with TSIG that lead to their filing litigation, what kind of reference can we expected them to provide? How will you overcome the likelihood of a bad recommendation?
c)In view of the serious cash flow problems that TSIG is experiencing that have resulted in default of many of its payment obligations as well as substantial obligation to the IRS for failure to pay Federal witholding and other payroll taxes, all of which are a matter of public record well within the reach and no doubt will be discovered by by any major potential client. Why would a large successful company with so much at stake choose TSIG to handle its call management....a service that has a direct reflection on on the reputation of its company when there are so many other well established,respected call center companies who are well managed,capitalized and referenced?
d)Additionally, litigation was filed against TSIG on 4/10/98 by Siemens Business Communication Systems Inc. Wherein Siemens is requesting the court for judgement against TSIG including among other things, granting Siemens petition for repossesion of communications equipment that it had sold to TSIG. Equipment that TSIG has alledgedly failed to pay for as agreed by contract.
The implication of this suit will likely cause any company considering entrusting TSIG with its call management services to take a step back. They might likely conclude that siezure of TSIG's telecommunications equipment might severely hamper its call center operations. Or at the very least a dispute with Siemens or any other telecommunications vendors could result in delays or refusal of needed equipment service.....How does TSIG plan on overcoming these obstacles of concern?
When we view the foregoing in the light of the reality of declining revenues,lawsuits,lost customers,ect. combined with the lack of announcements of any new major customers, we are skeptical that TSIG will suddenly be able to overcome these seemingly insurmountable odds and achieve profitability in its teleservices business in 1998 as so many of us on the S.I. thread are being lead to believe.
Please explain why such skepticism is ill-founded and why we should have confidence in the profitability of TSIG's call center operations for 1998?
Please assure us why we should trust what TSIG "says" will happen when our own experience with TSIG's past promises (Dates for web site completion,CCI launch,date for emerging companies TV broadcast ect.) have proven to be disappointing...and when it is also apparent that TSIG has failed to honor many of the commitments that they were willing to put in "writing".
Respectfully, JAB |
