Industry marketing organization Promax/BDA Monday turned down former President-CEO Jim Chabin’s proposal to take the non-profit group private by having it contract out with a newly formed for-profit company that Chabin would run.
Following the rejection, Chabin, 55, offered to resign and settle his contract, reportedly valued at more than $640,000 annually, rather than engage in a protracted fight with the organization he has led twice.
Chabin was ousted in January and replaced late last week by vice chair Lee Hunt, who was named as interim managing director.
He has about 18 months remaining on a five-year contract. Chabin returned in 2003 following a three-year stint leading the Academy of Television Arts & Sciences, where he went after overseeing Promax from 1992-99.
When news of his departure broke (B&C, Feb. 2), word surfaced that Chabin and a group of investors had offered to fund a new management company that would run the trade outfit with $500,000 in seed money. The new enterprise would have been subject to routine audits.
The vacationing Chabin did not attend Monday’s meeting, leaving Mike Benson, ABC’s head of marketing and board chairman, to offer the proposal for consideration. But the Promax/BDA board chose to stick with the status quo and remain independent, according to those familiar with the situation.
With Benson and others seeking to bring in an outside auditor to examine the books, attention immediately centered on finances. As B&C reported Monday, Promax/BDA generated $9 million in revenues and a $200,000 deficit in 2006, though some insiders say that is normal since sponsorship deals and early registration for Promax/BDA’s summer convention don’t come until January (money that is applied to the previous year and would have led to a likely annual profit).
But Chabin supporters blame his ouster on politics rather than financial improprieties. They say Chabin and the executive committee of the board were at odds over having two expensive Promax/BDA-sponsored trade shows in close proximity: the M16 video game marketers conference arrives in May and, the following month, the organization holds its big annual revenue-generating confab.
By offering to take Promax/BDA private, Chabin’s supporters say he was trying to make the group subject to “market rather than political” forces.
Chabin, who had reached out to have former President Bill Clinton be the keynote speaker at the June convention prior to his departure (it was announced Tuesday that Clinton will attend), says he is considering other career options.
As for the uproar, Chabin, declining to discuss specifics, says, “They just need to focus on moving ahead, and I need to step back and let them do it.”
Promax/BDA has also declined to comment on the reasons for Chabin’s departure.
