December 17, 2013 Oneida Business Committee Work Meeting Minutes

Below is a transcript of the minutes from the December 17, 2013 BC Work Meeting with GTC Assistant Frank Cornelius. The meeting took place two days after GTC voted to adopt a motion by GTC Member Cathy L. Metoxen to dissolve Oneida Seven Generations Corporation and for GTC Member Frank Cornelius to work with the BC to do so.

Here is a copy of the original:

_______________________

Business Committee Work Meeting Minutes
Seven Generations Corporation Dissolution Directive from GTC
Monday, December 17, 2013 – 9:00 A.M. in the [Executive Conference Room]

BC Members Present: Ed Delgado, Brandon Stevens, Tina Danforth, Patty Hoeft, Greg Matson, Paul Ninham, and Melinda Danforth

Others Present: Frank Cornelius, Cathy L. Metoxen, Larry Barton, Ralinda Ninham-Lambries, Jo Anne House, Tsyosha?aht [Cathy] Delgado (left the meeting at 9:20 A.M.), Nancy Barton, Lisa Summers, Racquel Hill, Trish King and Diane House.

Chief Counsel [Jo Anne House] stated there are two bank loans (one with the State of Wisconsin and the other for operating expenses) that will have an immediate impact on the corporation. There was also concern from Finance of the triggering of the GTC budget modification requirement as these dissolution expenses will be more that what the BC can modify the budget.

Frank Cornelius presented the following expectations:

  1. Requesting contact to occur within 15 day[s] with the lenders who hold the 8 loans that have immediate call provisions and the call amount be determined and paid for out of the (Government Executive) contingency fund
  2. Requesting these dissolution directive meetings be held the first Friday of every month and that his travel and a stipend be paid for by the tribe
  3. Requesting the 75% profits or rent collected by Seven Generations since 2008 to be recovered per the “charter requirement”
  4. Stop paying all allowances to Seven Generations Corporation (7G) officials as they are dissolved
  5. Requesting a forensic audit to be completed on 7G
  6. Requesting the Treasurer and Vice Chair recuse themselves from these meetings as they have conflict of interest with 7G
  7. Requesting all 7G’s real estate be transferred to Property Management until another person is hired
  8. Requesting the BC to take any legal action to dissolve according to the charter and to follow all laws
  9. Requesting information within 15 days of who the managers are, shareholders, and investors of 7G
  10. Requesting the minutes from each of these work meetings

Mr. Cornelius also reported that he had made direct contact with McGladrey’s Corey Topp about the missing information noted in McGladrey report; and the clarification of “minimal impact” to tribe on dissolution was given to him by Mr. Topp.

Chief Counsel corrected this statement and stated it was not a minimal impact only to the tribe’s credit rating of AA- and there will be other impacts that may not be minimal or forseen.

[Tribal CFO Larry] Barton was concerned over the lack of communication as GTC doesn’t know what is going on. Would like the final number of the real impact of this dissolution and how we can prevent this situation from happening again.

Chairman Delgado stated it is the BC’s responsibility to carry out this GTC directive and they need to make a decision on how to dissolve the corporaiton and to set forth what needs to be accomplished. Also need to bring in expert legal counsel who specializes in dissolution of corporations. Also voiced concern that we don’t have the replacement structure in place for the corporate activities.

Councilwoman Danforth stated the following concerns: Who is going to be responsible to carry out this directive?; need to identify who is going to assist in development of action plan that will reach out to the heads of other corporations or other partners, local governments, and financial institutions; need [to] identify what changes to policies are needed; need to identify where the dollars to assist in this dissolution will come from; need to identify the impact to the budget; need to identify the risks and also need to bring in expert legal counsel.

Secretary Hoeft stated that we need a separate team (which should include the Chief Counsel and the CFO) to bring forward recommendations for experts that can assist with this dissolution. She also recommended McGladrey as they are familiar with this 7G dissolution issue and the tribe overall. Mr. Cornelius objected to hiring McGladrey as he believes the report was incomplete and that we should not hire any people who come up with “bad studies.” Mr. Cornelius stated BIA auditors are free. He already contacted the BIA and called the Solicitor and they said they could assist us. Councilman Stevens stated the process of getting the [BIA] to assist us is more complex than that and it could take over 6-9 months.

There was discussion on who is responsible to dissolve. Chief Counsel stated it is more appropriate for 7G to hire the dissolution attorney. Councilman Stevens cited the corporate charter section where it state the corporation is charged with dissolution. CFO recommended that an independent agent be identified on behalf of the corporation to carry out the dissolution process – similar to what is currently structured at Oneida Golf Enterprise.

Assistant CFO [RaLinda Ninham-Lambries] stated her concern over 1) the Bank of America line of credit and whether this action makes the tribe in noncompliance; 2) establishment of a legal reserve for contingent liabilities; 3) the availability to GTC/whether the 2013 management analysis for the year en financials can be completed as this would be considered a material change [in] activity according to [Generally Accepted Accounting Principles]. She was also concerned that the [$25 million] in liabilities will be the tribe’s liabilities. She also reitereated the need for expert legal counsel that can recommend how not to trigger involuntary transfer provisions in the loan documents – that it would be unconscionable to just turn over our buildings to our partners. There also has to be notification to our organization that we will have to remain in cost containment as we do not know the real finacial impact of this decision yet. Vice Chair Matson was concerned that we need to send out a stability message soon.

Chief Counsel recommended that the BC call a special meeting to identify the next steps on how they will move this dissolution forward. The corporate board was informed that need to continue to manage the relationships with lenders until further notice.

Mr. Cornelius would like the following to happen by our next meeting:

  1. Have the Chairman and Councilman Stevens to contact the BIA to find out how long it would take to assist us in this dissolution
  2. Begin contacting the creditors
  3. Selection of expert legal counsel needed right away by Chief Counsel
  4. Would like these meetings the first Friday of every month. In lieu of paying him for his travel here, he would like a written progress report on the dissolution and that he can designate who can represent him.

Treasurer Danforth was concerned over confidentiality and that there is no way to enforce the confidentiality of other parties.

It was also agreed that an Emergency BC meeting which will lay out the next steps will be called in two days as Mr. Cornelius is leaving on Thursday.

Minutes respectfully submitted by: Diane House

_______________________

Speaking of “confidentiality,” sources inform Oneida Eye that the reason the BC refuses to release information about how much money that Gene Keluche and Sagestone Mgmt. are receiving for acting as OSGC’s “Agent” is due to a ‘confidentiality clause’ in the contract the BC signed with Keluche & Sagestone.

Which is odd given that Tribal Chair Ed Delgado’s December 17, 2013 Memo demanding that GTC “reconsider” its vote to dissolve OSGC also calls for GTC to “reaffirm” GTC Resolution 11-15-08-C, which states:

Be It Further Resolved,  that no “agent” of the Tribe shall enter any agreement with any corporation that prohibits full disclosure of all transactions (receipts and expenditures and the nature of such funds) and that such an agreement is not binding to the Tribe[.]

Therefore, any agreement between the BC and Gene Keluche / Sagestone Mgmt. which does not allow the BC to reveal how much they agreed to pay Gene Keluche / Sagestone Mgmt. is in violation of the very GTC Resolution that the Chair supposedly wants GTC to reaffirm, and subsequently any such agreement is not binding to the Tribe.

So which is it Ed & BC?

Do you want GTC to reaffirm GTC Resolution 11-15-08-C which already invalidates the BC’s secretive contract with Gene Keluche / Sagestone Mgmt. (as well as any contracts with confidentiality clauses entered into by OSGC & its subsidiaries)?

Or are you going to keep hiding behind improper confidentiality clauses and try to keep GTC in the dark in violation of GTC Resolution 11-15-08-C?

You’re sending very mixed messages.

Or maybe you just don’t know what the hell you’re doing.


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