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In 1992, just two years after the original buyout, the floundering Esprit was forced to restructure its loans. By the end of that same year, the company went into technical default. Bruce Katz, the Rockport shoe company founder who had signed on as a partner, was bought out after he filed a lawsuit charging that Susie and her partners had attempted to defraud him.
In 1993, Ammann was replaced by Cupertino management consultant David Folkman.
By the mid-'90s, after five years of appallingly incompetent management, Esprit's U.S. sales, not including sales of the separately owned and managed European and Asian divisions, had shrunk from $360 million a year in 1990 to around $200 million.
The 16 insurance companies and other financial institutions that had participated in Esprit U.S.'s debt restructuring lost hope of ever being paid in full. The trademark that had come to define California style was becoming known inside the industry as a retailer of cheaply made knockoffs. The failure was so rapid, and so complete, that some in the fashion world are still stunned.
"You don't expect somebody to go so wrong when they've been doing it so right," David Wolfe says.
Just as miraculously, Esprit does not seem likely to disappear. It may even thrive.
Last January, Jay Margolis, former vice chairman of both Tommy Hilfiger and Liz Claiborne, with the backing of the vulture capital firms Oaktree Capital of Los Angeles and Cerberus Partners of New York, bought Esprit's defaulted loans at 65 cents on the dollar, for a total of $80 million.
Margolis in turn hired turnaround specialist Alison May, who was a former CEO of Patagonia clothing and a one-time Chase banker, as the company's chief financial officer.
The company is investing in new computer systems, and Margolis says he is revamping Esprit's purchasing, manufacturing, design, and advertising divisions.
Sales are rebounding, thanks in part to a translucent Esprit beach shoe that sold more than a million units this year. From $220 million in sales last year, the company hopes to reach between $230 million and $240 million this year, and $300 million next year.
Margolis is reinstating some of the canceled employee benefits, and adding some quirky new ones that evoke the old Susie-and-Doug days: A messenger is sent each week to an outdoor farmers market to buy fresh vegetables for employees who wish to order some to take home. Bus stops in New York and San Francisco now sport Esprit placards. And the company is issuing a catalog for the first time in years.
The idea, Margolis suggests, is to erase Esprit's last seven years.
"This was a great brand that needed to be repositioned. Until 1988, it was such an amazing company," Margolis says in his glass and bare-wood office at Esprit's Minnesota Street headquarters. "In building a brand, we want to do what Doug Tompkins did. He built consistency and respect for the label."
The vulture capital firms hope to bring Esprit public during the next five years or so, May says. By then they will have built a few dozen more Esprit retail stores and completely refurbished the company's logistical and financial operations. It's still too soon to say whether Esprit's latest incarnation will be its last, but the market seems optimistic.
"I feel very, very strongly that God must have sent Jay to the board of directors, because I couldn't have imagined any other person who had the attributes to pick up that particular mess and put it into shape," says Harry Bernard.
Susie Tompkins Buell says she's glad to have Esprit out from under her. Even when she wasn't directly involved in management, she says, she worried constantly about the company. And it's been nice to get on to other things.
Tompkins Buell's assets were pretty well protected in the buyout deal arranged by Isaac Stein, she says, and she's financially very comfortable.
"I don't know what you call them. They're not investment bankers. They make deals and then they get a piece of it. It's just a deal, the art of the deal, that kind of thing," she offers by way of explanation.
While she is no longer considered the model New Age entrepreneur, she has another image now, in some ways just as flattering as the old one. By spending a portion of her millions on lavish parties and worthy causes, she's become one of San Francisco's most prominent socialites, and a respected philanthropist.
The fact that her name has been mentioned in front-page stories describing President Clinton's campaign contribution scandal has added to her public persona the role of harried political activist.
Bill Clinton refers to her as "my friend Susie Tompkins" in speeches. He might well; she contributed $158,200 to the Democratic National Committee during his 1996 re-election campaign. She recently had the president over for a fund-raising dinner -- hence the FBI visit last month.
In San Francisco, which likes its ostentatiousness served with a tasteful portion of liberalism, she has become one of the city's most celebrated hostesses.
She cemented this reputation last September with her marriage to local real estate developer Mark Buell. The reception was held on a pier at Fort Baker. The fete was a paean to Tompkins Buell's sense of stylishness, centered on a 1940s theme.
The wedding cake was based on a recipe for Blum's coffee crunch cake, which used to be served in the Blum's coffee shop in the basement of Macy's and was a midcentury San Francisco institution. Tompkins Buell had the bakery creating the cake track down the owners' heirs and buy the recipe, bakery sales director Christine Iriartborde says.