Zuffa Named in Bankruptcy Fraud Complaint
February 18, 2010
The latest turn in the Xyience Bankruptcy saga comes as David Herzog, the Liquidating Trustee for the estate of Xyience Incorporated, has filed yet another complaint in US Bankruptcy Court, this time against Zuffa Marketing, LLC (a company wholly-owned by Zuffa LLC).
The complaint alleges that in 2007 and 2008 Zuffa Marketing entered into a conspiracy with a number of Xyience officials to defraud creditors and stockholders out of the corporation. The complaint further alleges that Zuffa Marketing committed fraud on the court in order to avoid $4.5 million in repayment. Herzog alleges that these actions damaged the equity value of Xyience by nearly $100 million.
Herzog last filed a complaint on December 29, 2009 alleging Fertitta Enterprises, through affliate Zyen, pursued a lend-to-own strategy designed to take control of the company rather than purchase it from creditors and shareholders.
More to follow on the Xyience situation as it unfolds.
Xyience Signs Endorsement Deal with Dan Hardy
February 10, 2010
Xyience has announced the addition of UFC welterweight Dan Hardy to its growing stable of brand ambassadors; most of whom are other UFC fighters.
XYIENCE Signs Endorsement Deal with UFC Fighter Dan “The Outlaw” Hardy
LAS VEGAS (February 10, 2010) XYIENCE, the official energy drink of the Ultimate Fighting Championship (UFC) announces that UFC fighter Dan “The Outlaw” Hardy has joined its team of brand ambassadors by signing an exclusive promotional contract, effective immediately. The 27-year-old British welterweight has been fighting professionally since 2004. He has held titles with Cage Warriors, including Light Welterweight and Welterweight World Champion. In 2008, Hardy signed with the UFC, and now has an overall mixed martial arts (MMA) record of 23-6-0. In March, he will become the first British fighter to compete for a UFC title when he faces the current UFC Welterweight Champion, Canadian Georges St. Pierre, at UFC 111 on March 27, 2010 at the Prudential Center in Newark, NJ.
“In addition to being one of the finest fighters in the UFC, Dan Hardy is a unique individual –a dedicated athlete and highly creative artist. He approaches mixed martial arts with the same raw passion as his own art –deeply intuitive yet still influenced and inspired by his teachers and coaches,” says Jessica Lautman-Hughes, XYIENCE’s senior marketing specialist, who heads up fighter relations.
Payout Perspective:
The fighters are finally starting to figure out what it takes to be a good promoter. Now, not only are the big fights coming their way, but so are the endorsements. This is what the fighters need to be doing to build their brand and drawing power.
However, there is a risk that MMA, as a whole, goes overkill on the whole fight hype aspect of promoting events. In reality, it will likely work itself out; the guys that talk smack must be able to back it up (if they can’t, they won’t be taken seriously). Still, the last thing this sport needs is every fighter cutting a WWE-style promo like Wes Simms did on TUF and at the last Strikeforce show.
Xyience Bankruptcy Update
January 11, 2010
John Edwards of the Last Vegas Review-Journal gives an update on the financial health of Fertitta-owned and well-known UFC energy drink partner Xyience.
In a lawsuit filed in bankruptcy court Tuesday, Xyience liquidating trustee David Herzog of Chicago accuses Fertitta Enterprises, whose family members own the Ultimate Fighting Championship and have a minority ownership in Station Casinos, and others of pursuing a “lend-to-own” strategy to gain control of Xyience, rather than buying out company shareholders.
Trustee attorney Jonathan Backman said the lawsuit spoke for itself.
Greg Garman, managing partner of Gordon Silver, which represented Fertitta Enterprises in the Xyience bankruptcy, disagreed with allegations in the lawsuit.
“We have reviewed the complaint,” Garman said in an e-mail. “The (trustee) is new to the case and his factual conclusions are incorrect. These claims were previously brought by other parties and dismissed by the court.”
Payout Perspective:
The full article provides an adequate summary of the entire situation, but essentially Herzog is seeking judgement for damages and the consolidation of Xyience and its debt holder Zyen (the company, managed by Fertitta Enterprises, that made the loans to Xyience).
More information to follow in the next few months.
XYIENCE Taps into Major East Coast Metro Areas with Multiple Distribution Deals
September 21, 2009
LAS VEGAS (September 21, 2009)– XYIENCE, the official energy drink of the Ultimate Fighting Championship (UFC), has knocked out another big win on the East Coast, giving Xenergy Xtreme’s four flavors—Cherry Rush, Lemon Blast, Citrus Slam and Apple Jak’d—major exposure through roughly 7,000 independent retailers in key metropolitan areas, including New York City and Philadelphia.
A distribution agreement with Beverage Incubators, Inc., formerly Victory Beverage, in Bensalem, PA—distributor of major brands like Nesquik, Skinny Water and Function—opens over 2,000 independent retailer doors in Delaware and the South Jersey and Philadelphia areas for XYIENCE. Darren Matik, president of Beverage Incubators, Inc., notes that XYIENCE’s affiliation with the UFC was a key factor in picking up the brand. “We’re not tasked with going out and developing another brand. The energy drink category is competitive and awareness already exists in the marketplace, because of XYIENCE’s association with the UFC,” he says. “In addition to that, XYIENCE’s relationship with the UFC enables Beverage Incubators to engineer unique promotions at the retail level.” Beverage Incubators, Inc. and XYIENCE kicked off the relationship with a personal appearance by XYIENCE athlete and famed UFC fighter Matt Serra, at the Jetro Cash and Carry in Philadelphia. The event coincided with UFC 101, held at the Wachovia Center in Philadelphia in early August.
In the metro New York City area, newly established relationships with members of the Northeast Independent Distributor Association (NIDA), an alliance of distributors with major purchasing and distribution power in states from Maine to New Jersey, significantly boost the brand’s presence. In New Jersey, XYIENCE has entered into distribution agreements with Fisher-Thompson Beverage, based in Flanders, which services a portion of Somerset county as well as Hunterdon, Warren and Morris
counties; High Grade Beverage/Briar’s USA, a South Brunswick-based A–B distributor that services parts of sections of Somerset county and Middlesex, Mercer, Union, Sussex and Passaic counties; and J.D. Beverage in Newark, which handles Bergen, Essex and Hudson counties.
XYIENCE has also picked up additional retail real estate in Connecticut’s Fairfield County, home to the state’s four largest metropolitan areas, by striking an agreement with NIDA member B&E Juices. Combined, these relationships put Xenergy Xtreme in front of consumers in almost 5,000 independent retail outlets in the area.
According to Guy Battaglia, High Grade Beverage/Briar’s USA’s corporate vice president, XYIENCE’s affiliation with the UFC was a big factor for the group’s decision to distribute Xenergy Xtreme, and is an important selling point in his marketplace. “The choice to move forward was an easy one. XYIENCE came to us with a great product and effective packaging that includes the UFC logo in an eye-catching position on the front of the can,” explains Battaglia. “Excitement about the UFC throughout the U.S. is on the rise, and XYIENCE is a big part of the sport. Fans therefore identify with the brand, and because Xenergy is a great tasting drink, those fans will translate into customers for our retailers.”
“An East Coast presence is of paramount importance to XYIENCE, so we’re thrilled to establish these new relationships. It’s been an exciting process for XYIENCE to work with this group of distributors, who are tuned into the trends in their area and see very clearly how those can play out at the retail level,” says Csaba Reider, XYIENCE president and CEO. “After the UFC’s tremendous success in Philadelphia, we’re looking forward to leveraging that relationship to bring value to our distributors, retailers and ultimately the consumer.”
Through televised broadcasts of UFC events, the XYIENCE brand reaches some 100 million-television households in North America. As a part of XYIENCE’s UFC sponsorship relationship, its logo receives prime positioning on the mat and bumpers of the octagon. This often results in a fight’s critical moments taking place on or next to the XYIENCE and Xenergy logos, and translates into millions of viewer impressions for XYIENCE. Internationally, XYIENCE reaches more than 420 million television households via UFC broadcasts and Pay-Per-View broadcasts.
XYIENCE is also a sponsor of UFC Undisputed, the video game produced by THQ and released in May 2009 that to date has sold over three million copies. The brand has significant exposure in the game with the Xenergy and XYIENCE logos appearing on the mat and bumpers of the game’s octagon and on the shorts of prominent fighters featured in the game, like Wanderlei Silva.
About XYIENCE
XYIENCE nutritional products provide clean, sustainable energy necessary for an active lifestyle. Established in Las Vegas in 2004, XYIENCE is one of the fastest-growing brands in its category. All products are held to the most stringent standards of excellence to enable professional and amateur athletes and fitness enthusiasts to reach their goals in training and life.
Xenergy (A combination of Zen and Energy, pronounced “Zen-ergy”)
XYIENCE supports the mixed martial arts lifestyle. Its energy drink, Xenergy, and its energy shot, X Shot, are the official energy drink and energy shot of the Ultimate Fighting Championship (UFC). The first energy drink created by a nutrition company, Xenergy has zero calories and is a sugar-free drink fortified with vitamins. All-natural flavors provide a consistent supply of energy, sans the “crash” inherent with most other energy drink brands. Xenergy Premium Energy flavors include Cherry Lime, Cran Razz, Mango Guava and Blu Pom. Xenergy Xtreme Energy flavors include Lemon Blast, Citrus Slam, Cherry Rush and Apple Jak’d. Xenergy is available in retail stores throughout the United States and Canada. Visit www.xyience.com for details.
XYIENCE Supplements
XYIENCE supplements provide ultimate nutrition for peak performance. With everything from NOX-V2—for increasing strength and stamina and aiding in post-exercise recovery—to high-quality protein supplements such as the XProtein shake or the XM2 muscle meal, XYIENCE offers products scientifically formulated for specific training needs.
XYIENCE and Circle K Stores Launch Harley-Davidson Giveaway in AZ, CO, and NV
September 1, 2009
LAS VEGAS (September 1, 2009) – XYIENCE and Circle K stores have teamed up to offer shoppers in Arizona, Colorado and Nevada a chance to take home a new Harley-Davidson. The promotion kicks off on September 14 and runs through October 11 at more than 700 participating Circle K locations. Shoppers can pick up entry forms in the stores on Xenergy Premium case stackers. There is no purchase necessary; Xenergy Premium’s four flavors—Cherry Lime, Cran Razz, Blu Pom and Mango Guava—will be available for $1.99 per can during the promotion. The winner will be selected at random and will be notified by XYIENCE in early October.
XYIENCE recently wrapped up a similar Harley-Davidson giveaway promotion with Kum & Go stores, where sales of Xenergy quadrupled during the promotional period. According to Richard Ginther, Kum & Go’s category manager for package beverages, the increase in sales far exceeded projections. “The success was due in part to the simplicity of the contest, but more so from the fact that when our customers discovered that Xenergy is a great-tasting, sugar-free energy drink, store managers saw a tremendous number of repeat sales.”
XYIENCE anticipates the same success with Circle K, as XYIENCE CEO and president Csaba Reider explains that both XYIENCE and Harley-Davidson are sponsors of the Ultimate Fighting Championship (UFC), which has a large following in the states participating in the Circle K promotion.
“We’re dealing with a region that’s home to a large population of UFC fans, and they are very brand-loyal. The UFC and many of its fighters are based in Las Vegas. The organization established its roots in Colorado with UFC 1 at the McNichols Sports Arena in Denver in November 1993,” says Reider. “By providing those fans with a unique shopping experience, we feel we will create a greater connection for the consumer to both the XYIENCE and Circle K brands.”
“Circle K strives to be the most convenient place to shop because that enhances our customers’ lifestyle. So while our goal is to provide a fast and seamless shopping experience, we also work to make that experience memorable. XYIENCE is providing an opportunity for the Arizona region Circle K to address many of our shoppers’ passion by incorporating two important lifestyle brands –XYIENCE and Harley-Davidson, into a fun promotion,” says Heather Heller, Circle K business manager in the package beverages, beer, and liquor division. “We look forward to tremendous success in the weeks ahead.”
About XYIENCE
XYIENCE nutritional products provide clean, sustainable energy necessary for an active lifestyle. Established in Las Vegas in 2004, XYIENCE is one of the fastest-growing brands in its category. All products are held to the most stringent standards of excellence to enable professional and amateur athletes and fitness enthusiasts to reach their goals in training and life.
Xenergy (A combination of Zen and Energy, pronounced “Zen-ergy”)
XYIENCE supports the mixed martial arts lifestyle. Its energy drink, Xenergy, is the official energy drink of the Ultimate Fighting Championship. The first energy drink created by a nutrition company, Xenergy has zero calories and is a sugar-free drink fortified with vitamins. All-natural flavors provide a consistent supply of energy, sans the “crash” inherent with most other energy drink brands. Xenergy Premium Energy flavors include Cherry Lime, Cran Razz, Mango Guava and Blu Pom. Xenergy Xtreme Energy flavors include Lemon Blast, Citrus Slam, Cherry Rush and Apple Jak’d. Xenergy is available in retail stores throughout the United States and Canada. Visit www.xyience.com for details.
XYIENCE Supplements
XYIENCE supplements provide ultimate nutrition for peak performance. With everything from NOX-CG3—for increasing strength and stamina and aiding in post-exercise recovery—to high-quality protein supplements such as the XProtein shake or the XM2 muscle meal, XYIENCE offers products scientifically formulated for specific training needs.
XYIENCE’s Distribution Expands to Chicago with Kehe Food Distributors Deal
August 5, 2009
New agreement also lands Xenergy on shelves in Texas and Oklahoma
LAS VEGAS (August 5, 2009) – XYIENCE’s energy drink brand Xenergy continues to power its way through more retail doors. The Las Vegas-based company announces that Xenergy has penetrated markets including Chicago and Texas as a result of a deal with Kehe Food Distributors. The agreement puts Xenergy Premium, the official energy drink of the Ultimate Fighting Championship (UFC), on the shelves of 165 Jewel-Osco locations in the Chicago area and 170 H.E.B grocery stores in Texas as well as 20 Ramey’s Price Cutter stores in Oklahoma. While Kehe carries roughly 40,000 different food and beverage items, Xenergy has earned its place in the spotlight for the distributor.
According to Chris Ignash, Kehe’s category development manager, Xenergy is the distributor’s “go-to” energy drink. “Xenergy is now the driving force in the category. There is tremendous power behind the XYIENCE brand, due in part to its affiliation with the UFC. That relationship generates brand awareness that’s very attractive,” says Ignash. “XYIENCE’s marketing force coupled with the fact that the drink is sugar-free and tastes great made the decision to bring Xenergy on board with Kehe a very simple one.”
Additionally, XYIENCE was an exhibitor at the Kehe Holiday Show, July 26 – 27 at the McCormick Place-Lakeside Center in Chicago.
“To have Xenergy viewed as the driving force in its category by Kehe is an honor, yet it comes as no surprise to the XYIENCE team,” explains Csaba Reider, who took the reins at XYIENCE more than a year ago and has led the brand through new retail doors in states including New York, New Mexico, Arizona, and California, among others. “It’s a strong product that performs at the retail level and has a loyal fan base. We look forward to great success in the months and years ahead in this new relationship with Kehe.”
Earlier this summer, XYIENCE announced a distribution deal with New York-based Exclusive Beverage Distribution, giving the brand a presence in Duane Reade and Walgreen stores in Manhattan. XYIENCE finished up its spring season with a tri-fecta distribution win in the Southwest that included Phoenix-based Hensley, one of the largest beverage distributors in the United States.
Through its sponsorship of the UFC, the XYIENCE brand reaches 420 million households worldwide. The UFC’s current television distribution allows sponsors like XYIENCE to reach 50 million U.S. households and 380 million households outside the U.S. in over 100 countries and territories, with programming delivered in 20 languages.
About XYIENCE
XYIENCE nutritional products provide the clean, sustainable energy necessary for an active lifestyle. Established in Las Vegas in 2004, XYIENCE is one of the fastest-growing brands in its category. All products are held to the most stringent standards of excellence to enable professional and amateur athletes and fitness enthusiasts to reach their goals in training and in life.
Xenergy (A combination of Zen and energy, pronounced “Zen-ergy”)
XYIENCE supports the mixed martial arts lifestyle. Its energy drink, Xenergy, and its energy shot, X Shot, are the official energy drink and energy shot of the Ultimate Fighting Championship (UFC). The first energy drink created by a nutrition company, Xenergy has zero calories and is a sugar-free drink fortified with vitamins. All-natural flavors provide a consistent supply of energy, sans the “crash” inherent in most other energy drink brands. Xenergy Premium Energy flavors include Cherry Lime, Cran Razz, Mango Guava and Blu Pom. Xenergy Xtreme Energy flavors include Lemon Blast, Citrus Slam, Cherry Rush and Apple Jak’d. Xenergy is available in retail stores throughout the United States and Canada. Visit www.xyience.com for details.
XYIENCE Supplements
XYIENCE supplements provide ultimate nutrition for peak performance. With everything from NOX-V2 (for increasing strength and stamina and aiding in post-exercise recovery) to high-quality protein supplements such as the XProtein shake or the XM2 muscle meal, XYIENCE offers products scientifically formulated for specific training needs.
Xyience Founder Indicted for Tax Evasion
April 16, 2009
Russell Pike, the troubled founder of Xyience, was indicted on one count of tax evasion by a Federal Grand Jury yesterday in the United States Federal District Court of Nevada. The government alleges that Pike earned $6.9 million from sales of Xyience stock in 2006, but failed to file a Federal Income tax return.
More details are available at Rich Bergeron’s Fight News Unlimited.
Xyience Update
September 25, 2008
The Deal.com catches us up to speed on the recent developments in the ongoing saga of Xyience. The company itself seems to be down for the count but the legal proceedings are headed for a five round decision:
Xyience is on the verge of liquidating. Its assets were sold for $15 million to Manchester Consolidated Corp. in April and Judge Mike Nakagawa of the U.S. Bankruptcy Court for the District of Nevada in Las Vegas confirmed its wind-down plan on Aug. 26.
But fisticuffs, and worse, are far from over. Litigation surrounds the former maker of the power drink known as Xenergy and the seemingly endless cast of characters involved in its creation, its day-to-day management and its descent into Chapter 11.
The article from there does a good job of summarizing the questionable history of the founder, the impending fall from grace for the company, and the various legal entanglements that have sprung forth in the aftermath.
The entire article is worth a read. There will be more movement soon in the case, as indicated in the closing portion of the article:
A status conference on the shareholders committee’s and Bergeron’s lawsuits is scheduled for Oct. 8. ……. A status conference on the unsecured creditors’ committee’s lawsuit will take place the same day. Zyen and the Fertittas have sought dismissal for that case, too.
Thanks to Fightlinker for the find.
Xyience Update
April 3, 2008
The Las Vegas Review-Journal featured a pair of articles by John G. Edwards in recent days on the rise and fall of Xyience as well as the company’s official sale. On April 1, the Judge overseeing the company’s bankruptcy proceeding approved its sale to Manchester Consolidated for $15 million (mostly in the form of assumed debt).
The action looks set to continue in a potentially nasty civil suit filed by dissident shareholders against Xyience, its former directors, and companies controlled by the Fertittas. Unsecured creditors have also sued in federal court, asking that $14.8 million in assets be set aside from the Fertittas for the benefit of Xyience creditors.
UFC Owners Defendants in Xyience Lawsuit
March 21, 2008
I have a piece up on Sherdog.com this afternoon detailing the latest developments in a civil lawsuit brought by Xyience shareholders against the company and its directors. The lead:
Xyience’s bankruptcy proceeding is set to come to a close April 1 with a public auction, but the dispute between dissident shareholders and the company’s directors appears to be far from over. Publish PostLast December shareholders, led by Ronald Soloman, who controls 35 percent of Xyience’s outstanding shares by proxy, filed suit against Xyience and its directors for breach of fiduciary duty to the company’s shareholders.
On March 13 the plaintiff shareholders amended their complaint to include Fertitta Enterprises and Zyen, private companies owned by UFC co-owners Frank and Lorenzo Fertitta, as defendants. The complaint alleges that Zyen and Fertitta Enterprises aided and abetted Xyience’s corporate directors in breaching their fiduciary duty to shareholders as well as engaged in a conspiracy to defraud shareholders.
FULL STORY: UFC Owners Defendants in Xyience Lawsuit
