WHERE IS TOM SCOZZAFAVA (AND HIS SISTER DEDE?)

We thought this would be a timely repost from a long, long, long time ago. Thought of this post today when I saw a few ads on TV for the New York congressional race scheduled for November 3rd. Before you read the post check out the 2 ads that the DCCC put out attacking Scozzafava on this issue. Here it is -- feel free to comment. - The Upstate Good Old Boys

From a SWVC Shareholder regarding Dede & Tom's role in Seaway Valley Capital...

Over the last several years, I have been following the story of "local boy done good", Tom Scozzafava. For those of you who may not know, Tom is the young CEO of Seaway Valley Capital, the company that merged the Wisebuys and Hacketts stores last year, and is currently completing the process of merging with North Country Hospitality. I was very impressed when I first heard of Tom returning to his roots and his plan for developing a holding company in an area of the state that has typically been economically depressed. I confidently invested a goodly sum of money in him and his vision for the North Country, and have watched him quickly grow the company from nothing.

But now after 9 months, cracks are beginning to appear in the foundation.

It seems in all the whirlwind of the company's recent financial activity, Mr. Scozzafava has forgotten the common shareholders...you know, the only ones that are paying for all his high flyin', wheelin' and dealin'. There are genuine concerns of how all of his acquisitions are going to be paid for, and the methods of financing being used. The market has responded by crushing the price of common shares. Common shareholders, in some cases, have seen the stock price drop by as much as 95% since last fall. The share price today is less than 1/2 a penny, while outstanding shares have increased 600% since July of last year. In my opinion, it appears that the insiders, Mr. Scozzafava, his sister Dede (the State Assemblywoman), and various other family members and friends, are the only ones who stand to make anything on this venture. While protecting their own interests in the firm, IT APPEARS that they are using common shareholders to pay for millions of dollars of debt reduction carried over to Seaway from several earlier unprofitable business arrangements that Mr. Scozzafava had been involved in several years ago. If that wasn't bad enough, Mr. Scozzafava seems to be either unable or unwilling to communicate with anyone who wants a straight answer about where this is all going to end.

Don't get me wrong - what Mr. Scozzafava is doing may be above board, but there are enough unanswered questions to set off more than a few alarms. Even the market bears witness that few think much of Tom's corporate plan; the relentless erosion of the share price has been going on now for 7 months. If Mr. Scozzafava continues to avoid answering the difficult questions, then shareholder lawsuits are certain to surface in the months ahead, and the cloud of uncertainty will spread from Tom to his sister, Dede, who is a minority partner in the firm.

If anyone up there in the beautiful North Country of upstate New York sees Tom, please inform him that he has the fiduciary responsibility to step up to the plate and address shareholder concerns. A shareholder's meeting would be a welcome venue to clear up these issues and restore investor confidence in the company's CEO.


Sincerely,

Timothy Mercier

Happy Tax Day & Hacketts/Scozzafava Go Down in Burning Flames!!!

Folks, we wish we could blame this one on taxes but we just can't do it. Unfortunately all fingers point to an all too familiar face in the North Country. Hacketts/Seaway Valley/Wisebuys folks were delinquent to several creditors on large sums of $$$. This is one for the history books.

In other news, the nationwide tea party scheduled for today went off with great success according to all accounts both local and national.

Hacketts facing bankruptcy
By BRIAN KELLY
TIMES STAFF WRITER
WEDNESDAY, APRIL 15, 2009

Several creditors of Hacketts department stores have moved to force the company into involuntary bankruptcy.

Six creditors filed an involuntary petition Monday in U.S. Bankruptcy Court, Utica, seeking the Chapter 7 bankruptcy of Patrick Hackett Hardware Co., Ogdensburg. The creditors claim they are owed a combined $1.6 million.

The creditors' action seeks to have the company's assets liquidated, with distribution of the proceeds going to the creditors.

Hacketts operates nine stores in the north country. A 10th store in Pulaski closed March 28 and the company announced April 7 that it plans to close its Watertown store at 144 Eastern Blvd. by the first week of June. That store is having a going-out-of-business sale.

According to court documents, the creditors forcing the bankruptcy are:

— Columbia Sportswear USA, Portland, Ore., which claims

it is owed $500,707.

— Woolrich Inc., Woolrich, Pa., which claims $260,289.

— The North Face — VF Outdoor Inc., Appleton, Wis., which claims $657,307.

— Skechers USA Inc., Manhattan Beach, Calif., which claims $27,000.

— K-2 Sports, Seattle, Wash., which claims $36,200.

— Deckers Outdoor Corp., Goleta, Calif., which claims $74,477.

Jay R. Indyke, New York City, an attorney representing the creditors in the action, could not be reached for comment Tuesday. Thomas W. Scozzafava, chief executive officer of Seaway Valley Capital Corp., Gouverneur, which purchased Hacketts in November 2007, failed to return several calls seeking comment.

In March, Hacketts's then-CEO, Norman Garrelts, told the Times that Wells Fargo Bank was requiring the company to repay a $5 million line of credit secured in January 2008. He said at the time that Hacketts had paid back $3 million over the previous two months, significantly reducing the company's cash flow. He declined comment Tuesday as he is no longer serving as CEO.

Hacketts is one of the nation's oldest retailers, with roots dating back to 1830. It was acquired in 2007 by Seaway Valley, a venture capital and leveraged buyout investment company run by Mr. Scozzafava.

Mr. Scozzafava, along with his sister, Assemblywoman Dierdre K. Scozzafava, and Joseph G. LaChausse, had previously formed WiseBuys Stores Inc. to provide stores to serve communities left without access to basic goods when the Ames chain closed all of its stores.

In October 2007, Seaway Valley acquired all of the capital stock of WiseBuys and a month later it acquired all of the capital stock of Hacketts. All WiseBuys stores subsequently were converted to Hacketts stores.

On Dec. 18, Seaway Valley transferred ownership of Patrick Hackett Hardware Co. to The Americas Learning Centers Inc., Boca Raton, Fla. As part of the transaction, Mr. Scozzafava was appointed CEO and chairman of the board of the company, which was renamed Hacketts Stores Inc. On Dec. 22, Mr. Scozzafava announced that Hacketts Stores would be publicly traded as a stand-alone entity. The company's stock symbol became HCKE.

Seaway Valley also owns Alteri Bakery, Sackets Harbor Brewing Co., Sackets Harbor Brew Pub, Good Fello's Brick Oven Pizza and Wine Bar and 1812 Station House, all of which it acquired when it merged with North Country Hospitality Inc. in June.

As part of the merger, Christopher M. Swartz, who was president and CEO of North Country Hospitality, became vice president and chief operating officer of Seaway Valley. He resigned the positions April 3.

Where is Tom Scozzafava (and his sister Dede?)

Over the last several years, I have been following the story of "local boy done good", Tom Scozzafava. For those of you who may not know, Tom is the young CEO of Seaway Valley Capital, the company that merged the Wisebuys and Hacketts stores last year, and is currently completing the process of merging with North Country Hospitality. I was very impressed when I first heard of Tom returning to his roots and his plan for developing a holding company in an area of the state that has typically been economically depressed. I confidently invested a goodly sum of money in him and his vision for the North Country, and have watched him quickly grow the company from nothing.

But now after 9 months, cracks are beginning to appear in the foundation.

It seems in all the whirlwind of the company's recent financial activity, Mr. Scozzafava has forgotten the common shareholders...you know, the only ones that are paying for all his high flyin', wheelin' and dealin'. There are genuine concerns of how all of his acquisitions are going to be paid for, and the methods of financing being used. The market has responded by crushing the price of common shares. Common shareholders, in some cases, have seen the stock price drop by as much as 95% since last fall. The share price today is less than 1/2 a penny, while outstanding shares have increased 600% since July of last year. In my opinion, it appears that the insiders, Mr. Scozzafava, his sister Dede (the State Assemblywoman), and various other family members and friends, are the only ones who stand to make anything on this venture. While protecting their own interests in the firm, IT APPEARS that they are using common shareholders to pay for millions of dollars of debt reduction carried over to Seaway from several earlier unprofitable business arrangements that Mr. Scozzafava had been involved in several years ago. If that wasn't bad enough, Mr. Scozzafava seems to be either unable or unwilling to communicate with anyone who wants a straight answer about where this is all going to end.

Don't get me wrong - what Mr. Scozzafava is doing may be above board, but there are enough unanswered questions to set off more than a few alarms. Even the market bears witness that few think much of Tom's corporate plan; the relentless erosion of the share price has been going on now for 7 months. If Mr. Scozzafava continues to avoid answering the difficult questions, then shareholder lawsuits are certain to surface in the months ahead, and the cloud of uncertainty will spread from Tom to his sister, Dede, who is a minority partner in the firm.

If anyone up there in the beautiful North Country of upstate New York sees Tom, please inform him that he has the fiduciary responsibility to step up to the plate and address shareholder concerns. A shareholder's meeting would be a welcome venue to clear up these issues and restore investor confidence in the company's CEO.

(From a SWVC Shareholder... Ouch! I am sure DD is going to have a field day with this one.)


UPDATE:
This is from the contributor to this interesting post, which has sparked a fair amount of discussion I might add. Ahhhh, democracy in action! Here it is: "I have spoken with Ms. Scozzafava and need to correct information on the original letter (phrases not being factual). Not sure if that is possible, but I would appreciate whatever you recommend.

I have also posted the following retraction in the comments section of the blog:

Dede Scozzafava has no controlling interest in Seaway Capital, nor is she involved in any of the operations of the company. Her investment in the company is strictly passive in nature. I apologize to Ms. Scozzafava and to the readers of this blog for being uninformed about her role in the company."

Sincerely,

Timothy Mercier
Champaign, Illinois