I'm sending this to Board and Larry also to save time and typing. I'd hold off returning to Marriot until all of the Board has had a chance to consider more fully. On the basis of just the earliest remarks, including my own, the Marriot deal looks like it is still much too costly to be considered. You brought them a long way from their original position but there are still serious problems. The following changes would have to be made: If the Marriot intends they would charge for food cancellation over and above the liquidated damages settlement amount of $10,000, then they absolutely have to specify an amount and that's what needs to be specified as liquidated damages. "Liquidated Damages" means that's the end of it, they can't come to us for any other money for anything! We have paid off, liquified, all damages so there can't be any more damages to charge us for. Regarding less than the 270 in attendance -- they want to charge an "estimated lost revenue". The must settle on a specific number -- leaving something open like that means there is technically no limit on the liability and they could charge us virtually whatever they wanted -- they could charge for all the breakfasts that weren't sold at $20 apiece, all the snacks and soda, and lunches and room service, dinners, etc. Assurances from Marriot that it would be this or that amount aren't binding unless they write the amount into the contract -- the "estimated language has got to go. If they want to put in a number in place of "estimated", then unless the number is really small, the deal won't work financially. There is an even bigger problem with the Marriot offer, which is the total cost. First some background: In the summary I sent I yesterday I had used 270 and 200 as the number of guaranteed roomnights for Marriot. I should have used only 85% of those amounts (or 230 and 170 respsectively). Otoh, I didn't include tax. So having spent the better part of the afternoon proofing my rush job from yesterday, I have attached a revised summary, which doesn't really change the overall picture. If you look at how the budget plays out with the Marriot and Sheraton deals, it gives one pause. Personally, I am nervous about counting on 200 attendees just to break even, which is the case with the Marriot deal at 270. Even at 200 roomnights (170 guaranteed), we don't break even until we reach about 150 paid attendees --and that's still a record number for AGA, even with Amano and counting comps as paid. At 147 roomnights (125 minimum guaranteed) the breakeven is at about 125 paid attendees. Any less and the loss can still run into thousands. At 147/125 guaranteed, even with the reg fee moved up to $75, the breakeven remains above 100. But at that level of roomnights in the Marriot (100-125), we could at least expect to break even or better if we only have about the same or a bit less attendance as last year. I think that's a safe expectation. So at a minimum I think the Marriot deal has to be reduced to 147/125 or Marriot is off the table. I don't know if anyone else agrees with me. Keep in mind that the budget could easily be off a grand or two -- predicting the future is never precise. We're not looking to target high net revenues but we want to be confident we will be out of the red, reasonably certain liabilities won't exceed assets, and have some room for those unexpected expenses and less than anticpated revenues for some items that will arise. Imo: I'm not a fan of the Sheraton personally, but it looks like that deal could be accepted -- although I'd like to see us squeeze out a few more concessions. If we get folks to reserve rooms early the risks of exceeding the room commitment (and the hotel not having more rooms available) is lessened. So the lower number of roomnights might not be as limiting at it might seem at first glance. Imo: I would tell Marriot it's 147/125, no other cost increases, and the estimated lost revenue language is deleted -- we won't guarantee their peripheral sales since wwe don't share in any of the profits from those sales. If they can't agree to all that and no less, I'd wave goodbye, they're wasting everyone's time. Let's see what the others think. sh --- RickDotson@aol.com wrote: > I think with the food cancellation it breaks down to > about 13,120. As long > as the cancelation was not within three days it would be > > 10,000 within ninty days > + 3120 (38.90 x 200 meals x 40%) > > 13,130 fee > > room nights would equal 200 (most I could accept) x 85% > 170 MINIMUM ROOMS > ===== S. Hieber - - - - - - - - Amano Returns to the AGA Annual Convention Nov 2004 -- Baltimore __________________________________ Do you Yahoo!? Get better spam protection with Yahoo! Mail. http://antispam.yahoo.com/tools
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Marriot & Sheraton comparison.xls
Description: Marriot & Sheraton comparison.xls