| May 22, 1998
To: All of the Fans, Supporters and Participants of Robot Wars
I've tried to refrain from writing to you because - despite Marc Thorpe's attempt to make our dispute public - it is a private, commercial dispute that can't be solved by anyone but the two of us. Unfortunately, because you have been hearing a one-sided account that is filled with misinformation, I feel compelled to write to you and set the record straight. My intention is to give you what I believe is accurate information in the hope that it keeps you from incurring needless expense or wasting significant amounts of time and energy. In the end, I hope that you understand my position and realize that, in spite of what Marc has said about me, I am well intentioned and want what is best for Robot Wars.
The current status is: there is a court order in effect, signed on February 25th, preventing Marc Thorpe from holding any Robot Wars event, including the one he scheduled for August 14-16 without Profile's consent. On March 23rd, Marc filed a notice of appeal and on April 28th, he appeared before a three judge appellate panel seeking emergency relief, allowing him to hold the event. The panel denied his motion. Earlier this week, at the court's urging, Marc decided to withdraw his appeal. Although Marc has been trying to place the blame for the current status on Profile, I'm certain when you hear the facts you will realize that isn't true and you will place the blame where it belongs.
Like many disputes, ours is about money. In 1994, Profile provided the money needed to stage the first Robot Wars event. In exchange for our investment, Profile received a 50 percent interest. We were never merely a "sponsor." Another significant part of our agreement was that neither Marc nor Profile would compete against the other. In addition to the money we invested, we ran much of the day-to-day business of Robot Wars: negotiating licenses, handling publicity, etc. Our staff also helped organize the live events. This included all aspects of planning including staging, rules, legal issues etc. as well as smaller tasks like manning the doors and taking tickets. Although we lost money, which is expected with a new business, we were a success by any other measure. Robot Wars was simply a great show that could be appreciated by all.
In order to turn Robot Wars into a worldwide phenomenon, we agreed to invest additional money. From the start, one hundred percent of all Robot Wars expenses were borne by Profile. This included the substantial expense of building an arena and paying the salary that Marc wanted. In addition, we paid his family's health insurance. Because Robot Wars generated virtually no income, money was a one way street; all of it out, all of it ours. During 1995 and 1996, we increased our initial investment approximately ten-fold. We were willing to invest this additional money for two reasons. First, we were confident that one day our investment would pay off. Those of you who built Robots oudid yourselves. We foresaw the day where we could turn Biohazard, La Machine or The Master, as well as other robots, into household names, like the Ninja Turtles or other great action characters. Secondly, Marc promised to give us additional shares in the company for the money that we put in beyond our original investment. As part of our agreement, Marc would continue to hold the San Francisco event. We thought all the issues were resolved, but then came the messy part.
Marc refused to sign documents that reflected what he had agreed to. Even though Marc had received the benefit of using our money, including putting nearly $100,000 in his own pocket, it turned out that all along he was leading us on, making promises that he wasn't going to keep. To further aggravate things, he arranged to hold Robot Wars '97 behind our backs. At the same time, the business didn't have the money to stage the '97 event and although we might have agreed to invest the money that was needed, we certainly wouldn't agree to do so until we received what we were already promised. So without our knowledge or consent, Marc borrowed money so he could hold Robot Wars '97. We were left with little choice but to bring a litigation against him.
With the court's assistance, Marc and I came to terms on a new agreement. Part of the agreement was that he would be given a license to hold Robot Wars '97. The other part was that Robot Wars would repay Profile's additional investments over time. Since the event was taking place just 10 days later, the license was extended in time for the event to be held. The parties also agreed that they would later execute documents that reflected the repayment of the debt. When Marc was presented with these documents, he refused to sign them. Once again he was reneging on a deal he had agreed to and, in fact, already gotten the benefit of.
Since the parties were unable to complete the August 6th settlement on their own, the court ordered us to hire a private mediator to help us finish the deal. On December 12, 1998, the parties met. Instead of wanting to complete the August deal, Marc announced he wanted to sell his interest in Robot Wars and offered s his shares in the company for cash and a continuing royalty interest. In addition, Marc would get a license to hold two events per year, the San Francisco event and another in a city to be determined later. What happened then was the same thing that had happened before. After reaching an agreement in principle, documents were drafted and Marc refused to execute them. In fact, he wouldn't even enter into any discussions in order to finalize them.
Instead, Marc asked the Federal Judge who oversees our case to force Profile to consent to the holding of the '98 event. His theory was that - as part of the settlement - he was going to get a license to hold the event and he wanted to get the benefit of the license without executing the final settlement documents. As you might have imagined, his request was denied. Marc could trick us once, he could trick the Judge once, but nobody was going to fall for this charade a third time. The three judge appellate panel didn't fall for it either.
When asked about any of this, Marc will resort to the various excuses he likes to use about why he hasn't finalized any of the agreements. His favorite, "the documents don't reflect what we agreed to earlier" has been used three times running. Without getting into a debate over who's right and who's wrong, our most recent agreement was reached with the help of an impartial mediator. As of yet, the mediator hasn't told us there was anything wrong with the documents we drafted. In fact, after Marc walked away from the negotiating table the mediator tried to persuade him to return, but Marc refused.
At this point, the only way Robot Wars can be held is if Marc and I come to terms. Unfortunately, I'm not hopeful of that because Marc and his attorneys are refusing to speak to us. Even though the court order has been in effect since February 25th, Marc and others have made it sound as if the event can still take place without the need for Profile's consent, as long as it appears as if Marc isn't involved. We believe that the court will see through any attempt to violate its order, and will take the appropriate actions. If that happens, it would be unfortunate for an innocent third party to be caught in the middle. Marc has known for a long time that we would not consent to hold another Robot Wars event until we had reached an agreement. If he has told you otherwise and asked you to prepare for one, I can only speculate that he must have a reason for intentionally misleading you.
That's all for now. I do realize that a lot of what I've written is pretty complicated and I apologize for that. I also apologize that the current status of "no event" isn't what you want to hear. if Robot Wars doesn't happen this summer, it's because Marc Thorpe didn't keep his word and live up to the agreements he entered into - no other reason. Fortunately, there is still time for him to come to his senses and live up to the commitments he made. If that happens soon, an event can still be held. But if he continues to refuse, it will be up to the court to decide whether he still has any rights in Robot Wars. Until then, if anybody has any questions both Gary Pini and I are available to speak with you. Feel free to call us at 212-529-2600.
Thanks for your time.