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Dennis Fedorovich

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Material Information

Title:
Dennis Fedorovich
Series Title:
Columbia Restaurant oral history project
Physical Description:
1 sound file (63 min.) : digital, MPEG4 file + ;
Language:
English
Creator:
Fedorovich, Dennis
Huse, Andrew T
University of South Florida Libraries -- Florida Studies Center. -- Oral History Program
University of South Florida -- Tampa Library
Publisher:
University of South Florida Tampa Library
Place of Publication:
Tampa, Fla
Publication Date:

Subjects

Subjects / Keywords:
Restaurants -- Florida -- Tampa   ( lcsh )
Ybor City (Tampa, Fla.)   ( lcsh )
Genre:
Oral history   ( local )
Online audio   ( local )
Oral history.   ( local )
Online audio.   ( local )
interview   ( marcgt )

Notes

Summary:
Dennis Fedorovich, Chief Financial Officer of the Columbia Restaurant Group, discusses the financial history of the organization. The interview begins with a discussion of Mr. Fedorovich's college education at Notre Dame and his early work experience as a CPA (certified public accountant). Mr. Fedorovich also discusses various means that have been employed to improve corporate operations and the difficult decisions made in closing some Columbia Restaurant locations in the 1990s. The interview ends with a discussion of the future of the Columbia Restaurant Group and the plans to keep it strong financially.
Venue:
Interview conducted January 22, 2007.
System Details:
Mode of access: World Wide Web.
System Details:
Streaming audio.
Statement of Responsibility:
interviewed by Andrew Huse.

Record Information

Source Institution:
University of South Florida Library
Holding Location:
University of South Florida
Rights Management:
All applicable rights reserved by the source institution and holding location.
Resource Identifier:
aleph - 029078534
oclc - 255552246
usfldc doi - C57-00004
usfldc handle - c57.4
System ID:
SFS0022290:00001


This item is only available as the following downloads:


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Dennis Fedorovich, Chief Financial Officer of the Columbia Restaurant Group, discusses the financial history of the organization. The interview begins with a discussion of Mr. Fedorovich's college education at Notre Dame and his early work experience as a CPA (certified public accountant). Mr. Fedorovich also discusses various means that have been employed to improve corporate operations and the difficult decisions made in closing some Columbia Restaurant locations in the 1990s. The interview ends with a discussion of the future of the Columbia Restaurant Group and the plans to keep it strong financially.
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PAGE 1

COPYRIGHT NOTICE This Oral History is copyrighted by the University of South Florida Libraries Oral History Program on behalf of the Board of Trustees of the University of South Florida. Copyright, 2008, University of South Florida. All rights, reserved This oral history may be used for research, instruction, and private study under the provisions of the Fair Use. Fair Use is a provision of the United States Copyright Law (United States Code, Title 17, section 107), which allows limited use of copyrig hted materials under certain conditions. Fair Use limits the amount of material that may be used. For all other permissions and requests, contact the UNIVERSITY OF SOUTH FLORIDA LIBRARIES ORAL HISTORY PROGRAM at the University of South Florida, 4202 E. Fo wler Avenue, LIB 122, Tampa, FL 33620.

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Columbia Restaurant Oral History Project Oral History Program Florida Studies Center University of South Florida Tampa Library Interview with: Dennis Fedorovich (DF) Interview by: Andrew (Andy) Huse (AH) Interview date: January 22, 2007 Interview l oc ation: Columbia Restaurant Corporate Office, Ybor City Transcribed by: Rebecca Willman Transcription date: February 1, 2007 Audit Edited by: Rachel Li si Audit Edit date: February 23, 2007 Final Edit by: Catherine Cottle Final Edit date: July 21, 2008 And rew Huse : Okay, all right it's January 22, 2007. I'm here with Dennis Fedorovich Dennis Fedorovich : Yes. AH: And thanks for being with us today. DF: Sure, it's great to be here. AH: Yes, I'm here on behalf of the USF [University of South Flori da] Library as well as, the Columbia Restaurant, for the Centennial book. Okay. So first of all, tell us a little bit about your background. How did you get into the whole financial world? DF: Okay. Well I graduated from Notre Dame in 1983 and moved dow n with a job with Deloitte Haskins and Sells. Back then it was the "Big 8" in public accounting. So I'm a CPA, worked at Deloitte for about five years, just under five years. And then went with a small company for a couple of years. And there, moved to Dol lar Rent A Car in Florida which operated all of Florida. And I was a controller there. I was there for about five years and through that five years went through many transitions. That was very much a it was a turn around there. It was a distressed company. And in fact, when I went, we were actually a franchisee of Dollar Systems. Eventually it got taken over by the franchisor, and the franchisor was purchased ultimately by Chrysler. So we ultimately became a subsidiary of Chrysler. So I essentially I wo rked for Chrysler. So I got, kind of the big company mentality there. And I had some very interesting experiences there, just interesting from the standpoint of turn around, interesting from the standpoint of big busi ness and how big business works or does n't work A nd then also, interesting from the standpoint of just, business. I met with some

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2 people who interacted with people who are essentially icons in the business world today. People like Jerry York who went on to be he was the CFO at Chrysler, [and] went on to be the CFO at IBM. And is now a pretty well known person in finance circles. And some other people, so, just a lot of experience there. But after about five years there I was getting to the point where it was a big company. And it's pretty h ard to move a ship that's that big, or to be to feel that you're making an impact, and so I was looking for something a little different when this kind of came up, you could say. AH: Yes, now tell us about how did you catch wind of this? How did they find you? DF: Through common acquaintances. Actually, through my contacts at Deloitte. Deloitte was actually doing the work here, the tax work, and doing some of the other work. They were working with them through some of the issues they had at that time. Th ey knew were looking for a CFO and I happened to be kind of on the list, as far as knowing people at Deloitte, and Deloitte knowing the Gonzmarts. AH: Okay. So how were you first approached? Who did you speak to? DF: I talked to, actually it was Richar d initially. I guess the initial interview was in the office of Deloitte. And I certainly remember that day. And then the next time I met with both Richard and with Lee Sanders who was a consultant here at the time. AH: Yes. DF: And so and we kind of, w e went through that process, And it's interesting because Richard still, to this day, I've heard him as recently as a couple of months ago mention something that I mentioned to him in my interview about the need for integrity. And that, there's a lot of th ings that you can do in whether it's in business or whatever, [but] one thing you can't take away is integrity. And that's one thing that I would never compromise. And I was very clear with him in those interviews about that and still, almost twelve well i t is twelve years later and he still is referring back to that. AH: T ell us about that first interview. How did he explain the situation to you? DF: It was the end of the day, it was I want to say it was like six o'clock, five or six o'clock. And we we re in the office at Deloitte AH: And where was this office? DF: Downtown. AH: Okay, in d owntown Tampa? DF: Downtown Tampa. And I remember he was either, I don't know if he was tired or,

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3 physically or mentally or what, but we talked for a while but h e had a lot of papers and he was trying to show me some things but he really didn't even know what he was looking at because I don't believe the information he had I know that he didn't really have faith in the information. But I think he was just frustrat ed with everything that was coming from that end of the busine ss, so he was looking for some, someone to assist him with that. But I just remember him being exhausted, even I think, before we sat down. And like I said, not necessarily physically. AH: Okay so but you got an idea of the stress in that meeting obviously. DF: Somewhat. AH: Okay, so when you met would the second interview fill in some more information then for you? DF: A little bit. AH: Okay. DF: Yes. I think as we went along there were some information the thing about it is, living in Tampa at that time for it certainly ten plus years, twelve years or so, I knew about the Columbia, knew what it was, knew about the Gonzmart family. But just as a customer and as somebody who didn 't know an ything about the inner workings of the company. So they yes I knew there was some distress or some things going on, certainly, once I got here not until later on I don't think anybody knew. But really what I heard more from that was just the need to be org anized and to get a better feel for what's really going on in the business. AH: Yeah, I was talking to him last night and he had he was talking a little bit about your predecessor and just how difficult it was working like that. So the second interview y ou got a little better of an idea, and Lee Sanders is quoted as one of the other saviors of the company DF: Right, right. AH: now. So at what point all right first of all, I heard that you like a challenge DF: Yes (laughs), you could say that. AH: and you saw this as a challenge. At what point did you realize the full scope of the challenge that you faced? DF: Well I, I don't think anybody really knew until probably until I was here for a couple of months. Because it takes a while you kind of get your feet we t, you're trying to figure out, basically where the bathroom is. I t takes you a while to do that. But once you start to do that then, my role, I needed to try to get my hands around everything financial

PAGE 5

4 here. And the records were such tha t that was not an easy task. And we had the ability to find some things but it just took time. And in the meantime, while it's taking a little bit of time, of course the company continues to operate or to not operate [and] what have you. So there were th in gs that needed to be done, so it was very much a fine line of getting it done getting it done right but also addressing the issues that need to be addressed. The good thing is there were some good people working here. T he staff here and even then, Ric hard basically gave me carte blanche as far as if, "You need new people "If the people that are here are not doing what needs to be done, do what needs to be done." Well what I found is that with a little bit of direction and some sense of expectat ion, p eople here are very good, most of the people here have been here lon ger than me. And I think that's a real testament to what the company's about. AH: Sure. DF: But it took some time. And with Lee Sanders and certainly Lee had a big part of it, as did, ce rtainly Richard. But after a while we were just trying to get a handle on where we were, but at the same time, things needed to be done pretty quickly from a finance standpoint. AH: Okay. So explain to me Lee's role with he was C.O.O.? DF: No, Lee? AH : Yes. DF: He was just a consultant, an outside consultant. AH: Okay, okay, all right So what make s this period so interesting to hear about is the fact that so many things were being reassessed all at once. from an operations point of view, in the kit chen, the facility itself DF: Yes. AH: was undergoing some major changes. And then of course the finances which were so important. So tell us a little bit about the way things were being run before Cesar's death. Because it was much different than it is now how are things being run, and where were the problems coming from? DF: Well I really can't speak to that time. Certainly I came was it in March of ninety five [1995] ? And Cesar passed away in December of ninety two [1992] So I did not, I didn't know him other than to know of him. AH: Sure.

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5 DF: what I do know, or what I have heard is [that] the way business was done prior to then and that's true in a general sense of business in general there was more of more business with just a handshake and that was it. Well, now businesses, whether it's financing, there are certain covenants and what ha ve you that have to be met. And it is what it is, and that's just the world we live in. But don't know where I was going with that AH: Well just how thing s were being run before and then DF: Yeah. AH: and then how they were rectified. DF: Yeah. AH: for one, I know Richard talked about, that they didn't really make much of a salary and that, the company paid for their expenses which is really proble matic, especially from a tax point of view. DF: Yeah. AH: So tell us a little bit about how you went about rectifying it. W hat was the first step? And et cetera? DF: Well there were several first steps. First of all we had to find out where we were, so we had to put a stake in the ground and say, "Ok ay good or bad, this is what the financials are as of this day so we can start to measure." I think Casey, one of Casey's favorite quotes, and I may get it chopped up, but "Performance measure d is perfor mance improved." AH: Okay. DF: And I think that's a quote from Marriott. But so we had to put that stake in the ground and say, "Okay, this is where we are, and if we're going get [here], we need to be able to measure, but we have to have something to me asure against." We had no information to measure against. So that was really the first thing that I had to do is to start gathering information, financial information so operationally we could have a measure to see, "Are we doing better or worse?" And what impact we're able to have in operations by doing certain things. The other thing that we had was, at the time, the company was I would say, was bleeding from a financial standpoint. Cash flow was not sufficient to cover just normal course of business a ctivity, whether it's paying vendors, paying banks, other note holders, things like that. So we had to quickly get a hold of what's going to happen with our cash flow? How are we going to kind of get out of this hole that we were put in? And really

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6 what h appened at that time is, there were a lot of people who the company owed money to: banks, several different banks. And I think maybe getting back to your previous question, one of the things that had been done in the past is that financing was undertaken to cover normal operations. So that when you really had a need for finance you didn't have the ability to get it because it was just covering operations so if you had to spend money to, in a restaurant for capital expenses, things like that, it was not av ailable. Also the fact that you're getting financed to cover operations means you're losing. And so what happens when you start running out of financing operations? Well, you still got to pay that back and now you don't have the cash flow to do that. So we had to quickly get a handle on what our cash flow was, and how we were going to dedicate that cash flow going back out, what we were going to repay, how we were going to do it. AH: Okay. DF: And I think that is really where the Columbia name and the Gonzmart family name served to benefit their business. Because I believe that both of those names through both of those names, and through what they did for the ninety years up until that, they essentially built equity in the community. And in that equity they were able to tap in the form of going to people and saying, "We're going to have a plan, we don't know what it is today, but we're going to have a plan to get out of this, and we will come back to you when we have a plan." And so, because of that equi ty, people would at least listen to us at that time. AH: Yeah. DF: And that's really what we did after, after I got here, is we talked to people, and I remember going into Lynn Culbreath's office it was a few months after I started and being not so gen tly escorted out, saying, Come back to us, three months or six months when you have a plan." AH: Yeah. DF: And she was at Barnett Bank at the time, and we told her she basically met with us I think, as a courtesy at that time. And we told her, "Okay, we will come back. In three months, we're going to have a plan, and what we're going to do is come back and see you three months after that and tell you how we've dented in the plan." And really that's what started it it was conversations like that. AH: Okay. DF: Same thing with Joe Chillura and Al Rogers who were at Manufacturers Bank and Manny Alvarez at Manufacturers Bank at the time. And so we had a lot of things that we

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7 had to do, but the one thing that we told everybody is, "We're going to tell you what we're going to do, and we're going to go out and we'll do it. And we're going to come back and report to you how we've done, if we've done what we said or not." And we said, "We're going to be very up front with it." And I think that went back to the whole integrity thing. I think that we as a company made sure that what we said was the truth, whether it was good or bad. And I think that helped us through that time as well. AH: Yes, well, Richard mentioned the same thing. The fact that to go in and t ry to sweet talk someone would have just been more of the same. DF: Yes. AH: Nobody would have trusted you if you started giving them false figures and everything. Tha t's what he refers to as Cesar World ? DF: Yes, that's right (laughs) AH: P ull numbe rs out of the air DF: Yes (laughs). AH: So, and then he also said that sometimes that equity wasn't good e nough and that some banks said, "We can't help you." DF: That's right. AH: Yes, so then another thing I was interested in you mentioned putting a stake in the ground to measure. When the company couldn't really trust its own num bers, how do you go about doing that? Do you have to go to the different vendors and ask them what the account is? How does that work? I don't really [understand]. DF: Wel l we, I want to say we actually had Deloitte come in and do an audit as of the end of I think ninety four [1994]. AH: Okay. DF: That was the first that was the beginning balance if you will. AH: Okay. DF: And so we did the best we could at that time. Yes, we were able to confirm with banks how much we owed them. We were able to confirm with vendors how much we owed them. And so, that really, enabled us to know where we were. Because while I had some information as far as how much we owed certain banks and things like that, I really didn't know where we were with our main vendors and things like that. And as I said, the longer I was here, that initial time period the worse it got and the worse off the

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8 company really was. I don't certainly when I took the job, I didn't think it was that bad. AH: Okay. DF: But I don't think Richard or anybody thought it was that bad either AH: Yeah. DF: So AH: So try to give us an idea, the best you can of just how big was the debt? DF: Oh, I numbers wise, I off th e top of my head I couldn't. I'd have to go back and just kind of re familiarize myself with that. AH: Sure. DF: I will tell you that the deficit, the deficit of the company, that is, the negative net worth of the company was about five million dollars. AH: Okay. DF: Probably. AH: Now is that like, when you say "deficit", is that an annual thing? Or is that just what they were in the hole for at that given time? DF: That's, no that's not the annual loss, that is the accumulation of the losses at tha t time. Essentially I don't like to use this word, but essentially the company was bankrupt. If it's negative, a company that means it has more debt than it can pay. AH: Yeah. DF: And that number was five million dollars at that time. AH: Okay. So you ended up signing up for a challenge that turned out to be a little bigger than you thought initially? DF: Yes, yes. AH: Okay. DF: Yes. AH: All right so you placed the stake in the groun d and how do you go about first of all, obviously you have to tr y to cut expenses, is that the first thing you try to do? Or is was

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9 the cash flow inefficient? Was it being used in the wrong ways? How is it that you go ab out salvaging that? DF: T he first thing you have to do is you have to cover current operations. A H: Okay. DF: You have to make sure you cover that when food is delivered in the back door, then it's sold out the front door, but you have to pay for that food that comes in the back door. You have to pay for the rent of the building or the property tax o f the property that you own, that you're serving that in. So you have to cover those things currently. Then whatever the excess is, you devote that excess to paying down that previous debt. AH: Okay. DF: Well, through improving operations, first of all you have to make sure that you're not negative cash flow that is that you can cover your operations. AH: Yes. DF: The way we did that was we looked at some of our poorer performing locations and we closed them. AH: Harbour Island would be one example? DF: Yes, although Harbour Island wasn't performing too poorly AH: That's what I heard, yes. DF: b ut still the lease was up, it was a ten year lease, it was up in 1995, and we decided that Harbour Island was going through some transitions of its own so we didn't really want to be there through construction and things like that. So we closed that. Daytona Beach certainly comes to mind. We were operating three restaurants there and we closed that even though the lease wasn't up. But it was just bleed ing capital so much that we decided to do that. AH: What were the three restaurants there? There was a Columbia, was there a Cha Cha Coconuts ? DF: Cha Cha Coconuts and then Mangier, which was an Italian concept. AH: Okay. DF: So really what we did wa s that was, there were ways to raise money the first was through operations. So we were able to do that. The next way that, well, let's see there were at that time, all of these debts that were due from so many different sources, any

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10 one of them, it's alm ost like you have all these guns pointed at you, and at any time any one of th em can fire. And that could be AH: What, try to collect you mean? DF: Yes, yes. And if by firing the gun it could put you out of business. So what happened was none of them w ere fired, whether it's banks or vendors, things like that. And in fact some of them became very, very good business friends if you will. So again, we told them that we were going to have a plan and we were working on that plan. One of the ways one of th e parts of the plan was operationally to get better. The second way is to try to raise some money. We were able to do that, well operations cut losses. We cut losses by Daytona. The third way is to raise money, and we were able to do that by selling part o f Cha Cha Coconuts to a private investor. That in turn, brought money into the business that we were then able to funnel back out to our creditors. That was a significant milestone as far as being able to get rid of some of that old debt. We also were ab le to enter into terms with our master distributor, Henry Lee Company, who they, like so many were just very good partners with us. We signed a large note, for a large amount of past due. Normally in that business you pay within fifteen or twenty one days, we were out three or four months with them. But we paid we signed a note and we told them that we would pay; I believe it was bimonthly, twice a month, and we did a four or five year term. That was huge in enabling us to get out of that hole. And then som e banks worked with us to refinance we were at the time working with First Union for our main operating, and there was a man there by the name of Louis Messer who was in special assets which is their euphemism for the customers that could be in trouble A H: Yes. DF: But he worked with us at times when it was tough. And you never want to forget those people. There were a lot of people who helped to get us out. And they' re good friends. Whether it was Messer or Ed Sternly or Henry Lee, or some of the banker s. AH: Yes, Richard said many times those [are] people you never forget. DF: Yes. AH: And it may be part of that legacy of the handshake deals and all these things, the way business was done before that, someone would say, "Okay, you owe us money but we'll stand by and we'll wait or whatever DF: Right. That's right, that's right.

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11 AH: Okay so you pointed out some of the ways in which, the company was salvaged. How long did it really take to get out of that hole? At what point, the company's solve nt now, and it's flowing black, right? DF: Oh, the company is extremely strong. AH: Yeah. DF: Very viable, very strong. AH: And one of the things that I want to try to do with this book is, because I can document the forties [1940s] and the fifties [ 1950s] so well through these scrapbo oks, they're very honest about problems that happened and all different kinds of things. Whether it's a grease fire or running out of turkey on Thanksgiving DF: (sounds in agreement) AH: And to talk about that kind of first "boom" that that really began with the Don Quixote Room and ended some time in the fifties [1950s] And then talk about this nex t boom, which happened after this whole crisis was dealt with and the company now is stronger than ever DF: Yes. AH : W hat kind of time frame is that? You came in and started doing this work in ninety five [1995] ? DF: Ninety five [1995]. AH: Okay, and at what point was the Columbia out of the woods? DF: It was we could see the light out of the woods probably two to three years after that, and we were entirely out of the w oods, I would say, right around ninety nine [1999] to 2000. AH: Okay. DF: Certainly when we built the new kitchen in Ybor City, I think that was probably the real beginning. Because we were abl e to get financing like a normal company would rather than [one] kind of in distress. And we were able to add on we were able to start reinvesting back into all of the restaurants. There was so much delayed maintenance, delayed up keep, everything. Because the funds just weren't available to spend. So what happened was, we probably could see that we were going to get out of it after a couple of years; we certainly had confidence that we would get out of it way before that. But we could see it after a coup le of years. But yet we knew that we still had a lot to

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12 spend in all the units to bring them up to the standards that were where they needed to be. And so we were able to do that by continuing to focus on the o perations end, whether it was Richard and Curt and everybody over there. And then to just to make sure that, expenditure wise that we were not being foolish with how we were spending the money. And certainly to Richard and Casey's credit and everything, they were very disciplined in their desire to ke ep the money in the company, to build the company. And I think they reap benefits from doing that. Because the growth of the company experience from that point forward is way beyond what the restaurant industry as a whole expects or certainly performed dur ing that same period. AH: And what w ould the temptation be then? R ather than invest the money right back into the company, what, just start something new? Or try to DF: Either start something new or as owners of the company, take th e money out of the company for personal benefit or what have you. AH: Okay. DF: That just was not being done. And all that money was reinvested back into the company. Again whether it was to pay down debt or for new capital expenditures, so AH: Okay. So let's go to the little more of a personal aspect. Like, you e xplained when you met Richard, he was obviously exhausted and everything. What, as you got to know him, what were some of your first impressions? And were there things over time that impressed you or, etcetera a bout just the leadership there? DF: I think, yes, certainly throughout everything he never lost sight of where he wanted the company to be and certainly the what's the word I think there was an incredible amount of weight on his shoulders to not be the ge neration that, I'll say messed it up. I think there was certainly the bur den of that. So I really think, he had a goal for what the Columbia for what he wanted the Columbia to be and to come out from all this as. And he certainly focused on that. AH: Oka y. DF: I guess the burden of expectations maybe weighed on him? AH: Yes, oh definitely. Yeah and being part of this such a big legacy. DF: Yes, yes. AH: Yeah. All right so, for you personally then, and professionally you went from not making a big d ifference in a very big ship, that you couldn't steer at the bigger company to makin g a huge difference, right? It must have been gratifying for you.

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13 DF : Definitely, yes. Definitely, when I interviewed with Richard I told him at that time that unless thi ngs happen, unless there's either there are some things that I don't know about the business that come up or unless there is a transaction, that my job is about a five year job. And the job of a C.F.O. yes, you come in, you do what needs to be done, and th en after about five years, things are going, things are humming, and then it's time to evaluate. Whether is it time to move on or not? And I was real up front with him. In the in terview I told him, it's a five year job. Unless som e things happen, whether i t's new businesses, things like that. But once I got into it, after a few months, it was not a five year job; it was a littl e bit longer than that. And so that five years certainly stretched beyond that. AH: Well we were DF: I have, as far as the sa tisfaction that comes with AH: Yeah. DF: I'm a finance guy. I'm an accountant. I always tell people "I count the beans, I don't cook them here." And they should be happy for that. AH: ( l aughs) Yeah. DF: But there is satisfaction. And I'm not a pers on who wants to be out front or anything like that. But the Gonzmarts, all of them, have always been very, very good to me, very. And to my family. But [they] have been very appreciative, and haven't been afraid to show the appreciation, to let me know tha t. And that's tha t to me, that's all that I need. And that has been, as well as it's been nice I had mentioned earlier about the staff that was here when I came here One of the other big things t hat happened a few months after I started, I hired Mark Rus s who at the time was accounting manager, now he's a controller and none of this would have been done, without his work. And really he has led the people here that's allowed me to be more focused on other things other than some of the day to day things her e. And so just having that group of people that's been here for so long, there's just there's a lot of satisfaction that comes with that. AH: How do you spell his last name? DF: R U S S. AH: Okay, thanks. DF: Yes. AH: Okay and for someone obviousl y who takes pride in his work; it's the kind of thing where you ca n really see results, right? It 's not I guess it's the same thing as the steering the ship t hough, but you can really see, "This is where we started, and this is where we are now."

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14 DF: Ye s. Well, and that's true. they say a picture tells a thousands stories or what have you. AH: Yeah. DF: And I give an annual report to our managers and then I do the same thing for the family. And a few years ago I kind of changed it around. Rather th an just putting up a bunch of numbers on an overhead, I put no numbers up and it's just pictur es with graphs, just showing, here's where we were [and] here's where we are. And there are some of those where I could just get them framed and hang them up in m y office and be happy just staring at them. AH: Yeah. DF: Because it really shows that, where were we? That from that stake in the ground to, where we are today, and, what has transpired during that time. So those are fun things to look at. AH: Yeah. DF: They are. AH: I'd love to see some kind of graphics too like that or something. Because I have profit and loss reports from the thirties [1930s] and the forties [1940s] DF: (laughs) AH: and then of course the Great Depression was an interesting ti me to be in business. DF: Yeah. AH: So you can see some really thin years there where, the old story about one of the waiters lending some money so they could stay afloat. You can see in that profit and loss report, ouch. DF: Yes, yes. AH: And then se e by the end of the thirties [1930s] its like, wow, it's a completely different company. DF: Yeah. AH: So this isn't the first time that DF: Yeah.

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15 AH: the Columbia has had to reinvent itself financially. DF: I t hink one o f the things that did happe n is with an ongoing business there are certain disciplines that you have to have. And the fact that Richard and Casey were open to instituting these disciplines really made a big difference. Things like they had really never done anything with budgeting, looking forward, "What are we going to do and what is that going to enable us to do?" The first time I did a budget, they kept calling it a crystal ball. And I was trying to explain to them that the diffe rence between a crystal ball is just hoping and wis hing. AH: (laughs) yes. DF: A budget is based on track records and expectations and knowing w hat's going to happen. And so as we got through the first few years and through luck through some luck and through some other things, we were able to be prett y close to those. So they came to, I think to know that the budgeting process is that. It's a road map for where you're going to go and how you're going to get there. So that discipline has been able to and still throughout the organization. AH: So your b udgets would then project how far ahead? DF: Well we'd go out primarily we'd go out through the end of the following year AH: Okay. DF: and that gives us an idea of, how much cash we're going to be able to have to invest whether it's to invest in cap ital expenditures, to invest in opening a new restaurant or what have you. And that's what enabled us at the beginning to go to our the people that we owed money to, our creditors, and say, "Here's what we're going to do, here's how we're going to do it, a nd this is what's going to be available for you." AH: Okay. Now let's talk about how it got form being a five year job to something more. Obviously they were deeper in the hole than you initially thought, so maybe it took, a little longer than five years to get out of it. It sounds like it was about five. DF: It did. It did. AH: Okay. So then what else, what else kept you here? obviously, you talked about the way you're treated by the family. DF: Right. AH: In that, this reputation of being a family business and people employees being a part of the family

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16 DF: Yes. AH: isn't just window dressing or making something look nice. From everyone that I've talked to, that's the case. DF: Right. AH: What are some of, what are some of the other factors? Is it expanding into new concepts? Or what has kept you interest ed and engaged here? DF: Richard and I had several discussions about that. And a few years ago it was getting to the point wh ere I'm not a maintain person. Once things get up and get runnin g, I don't want to just sit back and maintain because somebody in my position really, they shouldn't have to pay somebody that much to just maintain. And I'm pretty sensitive to that. So I was starting to consider doing some other things and had been ve ry up front with them and talked to them about that. And then a situation came up where some franchises became available and Guy Campbell who's the C.O.O. for Cha Cha Coconuts and I, Guy found out about it. He and I talked and then we talked to Richard abo ut investing in these franchises. So we've formed a partnership to start developing franchises in Tampa Bay area as a franchisee, Moe's Southwest Grill, Mama Fu's and Asian House. And so we did that and that really kind of enabled me to continue to grow pr ofessionally. Because that's, kind of what I needed. And actually the same thing with Guy, and so with that we're able to here we are. We continue to click along. AH: Okay. Great. Well what haven't we covered? I think we've systematically gone through t his. DF: Yeah. AH: But there must be some things, like, let's try to sum a few things up here. First of all, what was and I think we might have already gone there. But for you, what was ki nd of the darkest moment, like were there ever any doubts or whil e all these guns were pointed at the company, at what point were you like, "Wow, maybe I'm in a little over my head." Did it ever get to that point? DF: I remember when Lee Sanders got a phone call from, it was a bank that was going to foreclose or call a debt that we had. And it was the largest debt. And the thing about that, is AH: It was the largest debt? DF: It was the largest debt at that time. AH: Okay.

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17 DF: And the thing about that was, we were in default, we were in default with that as well as so many others. But we were in I want to say we were in their special assets department or whatever. And their special assets department was in Dallas or Houston or somewhere in Texas. So, there is no equity in what the Columbia means to Tampa, or what the Gonzmart family means in Tampa. That is just business. It is what it is and "This is what you're going to do and you're going to do it." And that was it wasn't only [that] the gun that was pointed at us, but it was cocked, the finger was on the trigg er, ready to squeeze it. And we were able to get by that. That was close, I think. Then we also had to deal with the Department of Revenue Florida Department of Revenue on some sales tax issues. AH: Yes. DF: There was some whether it was creative fina ncing or what, by not paying sales tax that we had to deal with very quickly. And so those two things probably were the toughest two things. And if they would have gone a different way, something, yeah we maybe AH: We might not be talking. DF: Right. What we'd be talking about would be substantially in different form than what it is today. AH: Okay. DF: So AH: Interesting. DF: Those were a couple of bad, tough things. AH: So how did you squeeze by with that bank in Dallas? W as it just a heart t o heart or? DF: Well, no. No. We had to I believe that Adela financed her home and provided the capital for that. There were a couple of things that we did to, again, to raise money whether it was getting se cond mortgages on Adela's home; I don't know tim ing wise the Cha Cha's transaction I believe was after that so I don't believe that did it. But then also working with some of the local banks here to help us to take them out, so AH: Okay. And then on the other hand I want to hear, what's the proudest m oment for you? Professionally here at the Columbia? DF: The one proudest moment. I'd really have to sit and think of it. I was going to say AH: You can offer a couple, that's fine.

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18 DF: Well no, when you were sitting here saying that they said somet hing about being a savior first of all I am not that, it's not me. It was it's everybody here, it's everybody that's sitting there. But just to know that they, they think highly of me that, whenever they say [it] whether it's to one person or to, five peop le, that certainly makes me very proud. One of the proudest moments was, and I Richard would probably echo this -when we had a 700,000 dollar debt, roughly, to our distributor. AH: That's big. DF: And I had mentioned to him that we were getting ready to make the final payment, and I suggested, "Why don't we just go down and hand them the last check?" And so that that I think, made both of us feel good, that we were able to do that. AH: Yeah. So actually went down physically DF: And handed him the c heck. And they as it turns out they didn't know why we were coming down. They were afraid that we were coming down for not a good reason! ( l aughs) DF: And we said, "No, we're just here to" we wanted to thank them personally, shake their hands and say tha nk you, because they were part of sustaining the legacy here. AH: Yes. DF: And then AH: And do I remember correctly that it was a double payment? Just to get it done with? I can't remember, I might be mis thinking here, but DF: Yeah, I it may have be en, but it was just AH: Just to get it done DF: Yeah. AH: But that's I thought I remember hearing something about that. DF: Yeah. AH: But that could have been a diffe rent something or other, but, o kay. So that was a big one. I know that's a big one of Richard's yeah. DF: Yes, yeah, yeah. AH: Absolutely.

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19 DF: Just I'd have to think about that one. AH: Well you can always get back to me. DF: Yeah, I may do that. AH: Because I'm sure DF: Because I know there are some things that I'm not think ing about. AH: Well I'm sure there are lots of little things. But was there ever you got a report and could see the numbers and go, "Oh yeah, that's so much better!" DF: Yeah. AH: The re may have been a moment like that too. DF: C ertainly the first ti me that we were able to provide any kind of dividend payment to the owners, to Richard and Casey Side 1 ends; side 2 begins DF: was one of the top moments because I remember having a conversation in this room with Casey in probably 1996 or so. And I t old him that there will come a time when see at that point, both he and Richard, because of the way they were using the company and not taking salaries, they really owed the company, essentially, millions of dollars. And I told Casey that there will come a time when the company will be able to pay dividends to them. And they, they both understood that you can't pay dividends until you pay back that debt. Casey, he looked at me and he said, "I don't think that's going to be in my lifetime. And I said, I will tell you it's going to be in your lifetime." AH: Okay. DF: And I remember that, and I remember the first time we cut a check as dividends that I actually handed it to him and reminded him of that conversation. AH: Yeah, what roughly year was that? The dividends? DF: Two thousand [2000], 2001? AH: Didn't have to wait too long did he? DF: Yeah, yeah. AH: Okay.

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20 DF: Maybe Yes, early 2000's somewhere. AH: Okay. DF: Yeah. AH: Yes that is a good one. I like that. DF: Yeah, so. AH: I can defini tely use that. Okay, well what else is summing up? Have we missed things here? Obviously there's so much, and let's talk a little bit just about after, the first dividends, the kitchen what kind of occupied your attention there? Say from 2001 to now? is it the new franchises? I know they didn't always work out for the company in particular DF: Right. AH: but was it that? What were some of the other things? Capital improvements in the other restaurants? DF: Yes, certainly capital improvements [and] doing a better job with mea sure and performance. You can always improve AH: Yeah. DF: And so those kinds of things. General improvement in every area, whether it's technology area, trying to bring new things in. We have spent if I had my cheat sheet h ere from last week, yeah, we've spent over seven million dollars in the last five years in capital expenditures, making sure that we have the financing in place and the best way of handling those. Or using cash flow [and] those kinds of things. AH: Okay. DF: That was all important. Sustaining the business for the next generation I guess. AH: Yes. DF: And, making sure looking ahead, looking forward to know that there will be, that there will continue to be growth and where that growth will come from how much it will be. And making sure that enough is invested back into the company. That's been the mainstay of, the last four or five years. AH: Okay. Now let's talk a bout the future for a minute. When you polish the crystal ball now, what do you see in the company? First of all, economic outlook, which sounds quite

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21 good, but then also, what's next? DF: F rom a finance standpoint, the company is very strong and continues to be strong. Richard and Casey both made decisions to keep money in the company again rather than take every amount that they could out of the company so that the company is strong. It has [an] extremely strong balance sheet, to sustain downturns. That's the one thing that we've really worked on, is to make sure that we have strong ba lance sheets so that when the inevitable downturn comes, whether it's economic or, hurricanes or something like that AH: Sure. DF: that we can sustain for the long run AH: Okay. DF: for whatever the next steps ar e. It still remains to be seen wha t's going to happen next, but operationally the need to make sure that we have the best people in the right positions I think that will sustain the company. AH: O ne of Richard's moments, and I'm sure you were kind of a part of this was that he had hea rd a speech somewhere about "When's the last time you took a vacation for two weeks and didn't call the company?" DF: Yes. AH: A nd then he went out to the South Pacific and everything, knowing that everything would be taken care of DF: Yes. AH: a nd that the company wouldn't fall apart when he was gone. And a big part of that was surrounding himself with strong people, smart people. Something that Cesar didn't do. So, I'm sure you knew about that DF: Oh yeah. AH: And the fact that he DF: Yes. AH: booked it so he couldn't call! DF: Right, that's right.

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22 AH: And that must have been a compliment, to you and the others. I know I've spoken to Jim Garris and some other people who have, tack led some operational problems. I know just to know that there was still a union here and that it was really dictating DF: Yes. AH: a lot of the way business was being done in the house, was kind of DF: Yeah. AH: crazy to think of! And definitely gives you a different point of view about unions if you 're idealistic about those kinds of things. DF: (laughs) AH: The fact that women weren't hired and all these other things, so DF: Right. AH: hearing about the operational side is really interesting. And I guess for you, knowing that you could have co nfidence in those people that are taking care of the front of house issues must have made your job a little easier, knowing that, even if you fix some behind the scenes problems, that if the front of house is still falling apart that it really doesn't make a difference, right? DF: Well yeah, definitely and that goes back to, when we first started and I said there were a couple things that needed to be done and the first thing that I said was operationally, we needed to make sure that we were doing the bes t job we can. maximizing every single dollar that we received. And we, one of the things that happened another conversation that I remember very specifically was in this was in the cafŽ. I was talking to George Guito who I'm sure you've talked to. AH: Y es, I've interviewed him. DF: And we were going it was about May or June and we were going into summer, which is traditionally, at that time, the slow time. And he was saying "Oh, we never make money at this time of year, and, we just Basically what th ey try to do is maximize as much as they can during seasons, and try not to lose it all during the off season. And I said to him at that time, I said, "Well, there's no reason why we can't make money here twelve months out of the year." And he said, "Oh, y ou just don't understand, you don't understand, AH: Yeah. DF: let me explain it to you."

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23 AH: ( l aughs) DF: I just [said], Let's just remember this conversation because there will be a time when, twelve months out of the year, you will make mone y." And so, that certainly has happened. And AH: So you DF: there's some maybe there is some confidence on my part, but maybe there is some also what is the word, naivety ? AH: Yeah (laughs). DF: However you say that. And maybe I was just na•ve in t hat, not to think it was going to be so difficult. Of course it was difficult but, we should be able to do that, and we are. AH: Okay, so was there ever a point that you'd go back to George and say, "Remember that conversation we had?" DF: Oh yeah, oh yeah. I remind him of it a lot. AH: (laughs) A lot! DF: Yeah. AH: Yeah, because it sounded like him, (talking as George), "Let me explain it to you DF: Yeah. AH: ( l aughs) DF: Yeah, I remind him of it a lot. AH: Because him being here so long D F: Yes. AH: H e gets the idea that, someone, some new young guy coming in can't possibly DF: Right. AH: know the ins and outs of his business like he does. DF: That's right. AH: Okay, that's interesting.

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24 DF: Yeah. AH: That's another great story. DF: ( l aughs) AH: And one that George didn't mention, I might add! ( b oth laugh) AH: But there were a few Jim Garris stories too DF: Yeah. AH: that of course George didn't mention but he's not as easy an interview as some others. But all right well I guess we've I think we got what we needed. DF: Okay. AH: The, the actual stories about certain conversations are especially great DF: Yeah. AH: because it illustrates much larger points. DF: Yeah. AH: So it makes my job a lot easier. Is there an ything you want to add? DF: Yes, just the I was thinking about it before you came. The one thing I'm always I may even butcher this one, so I'd want to make sur e I get the quote right, but, "T hose who forget to remember their history are bound to repeat it." And I think that's the one thing that I think; Richard certainly will always remember that. And when the if it's the next generation or when the next set of management comes in or whatever, certainly with his kids and with Casey's kids to instill in t hem that, this is where we've come from and this is what happened when we took our eye off the ball. And you have to know, you have to understand what happened so that the same thing doesn't happen to you. And I think that's important. AH: Yeah, he paraph rased the same quote last night. DF: Did he? AH: When we were talking. DF: Oh yeah?

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25 AH: And how Cesar used to talk about history and that it was important and Richard never thought it was. DF: Yeah, yeah. AH: But one of the things to keep in mind especially weathering this crisis is that you guys made history. It might just be for one company DF: Yeah (laughs). AH: but it's going to be in a book soon enough. DF: Yeah. AH: And I think, the whole team can be proud of what you guys have done. DF: Yeah, yeah. AH: And I want to thank you for making the time today and sitting down with me and talking. DF: Sure, no it's been my pleasure. AH: It really, it added a lot to the overall story and everything. DF: Good. AH: And to me it's, it's jus t like they say times of peace don't make good ratings as the times of war and DF: That's (laughs). AH: This crisis in the nineties [1990s] is indicative of the resiliency of this company, And the fact that it's much more than just dollars and cents an d that, if it wasn't a family business, would Richard have just thrown up his arms and said, "Oh, to hell with it?" DF: Yeah. AH: "We can sell off the shares or whatever and bring in some partners or just sell the company off altogether". So well thanks again for being with us. DF: Yeah, thanks. And if you want to if I think of something else I'll let, but in the meantime AH: Please do and I think I have a card here, let's see

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26 DF: Okay. e nd of interview For Interviewer/Intervi ewee Remaining questions regarding Dennis Fedorovitch transcript Page 10 Louis Messer and Ed Sternly [unsure if these names are spelt properly]