Project/Necessary changes in involvement in EcoReality

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Contents

Project ID: 136

Project steward

Jan Steinman

Need

To smoothly transition people from the current irreconcilable differences among those invested in EcoReality.

Description

Spring 2010: the directors agreed to put the EcoReality assets up for sale in preparation for dissolving the co-op and paying out the proceeds to debt holders and investors.

July 2010: an investor came forward who was willing to cover about 56% of EcoReality's long-term debt, so we could continue operations and future plans. The directors agreed to seek financing on the balance.

October 2010: together with that new investor, we crafted a business plan in order to qualify for a loan on the balance of our long-term debt. At that time, we assessed EcoReality's finances, and agreed that we had about one year to either make the business plan work, or once again face financial crisis.

October 2011: for various reasons, largely due to differing work-styles, the past year has not seen successful implementation of the business plan, showing a net loss for the year. The members and three major investors have all been made aware of this situation.

November 2011: we are now at a point where EcoReality can no longer service our debt from co-op operations, forcing us to assess site occupants rental fees in order to service debt.

December 2011: one of the three site residents refuses to pay rent or sign a rental agreement (twice) in order to service debt.

January 2012: The three biggest investors agree this is a matter of irreconcilable differences, and seek one of the following solutions:

  1. Someone buy out their full interest in the co-op,
  2. Someone buy out the other investor's full interest in the co-op,
  3. Put the co-op assets up for sale once again, in preparation for dissolving the co-op and paying out proceeds to debt holders and investors.

If we cannot agree on one of these approaches, an unpalatable fourth alternative will occur: foreclosure and forced liquidation of EcoReality assets.

Minutes:20120125: resolution to allow transfer of investment shares upon board approval.

Status

  1. 2011-10-10: Jan verbally informed Ron of the financial situation, and outlined what he saw as the three alternatives cited above.
  2. 2011-10-24: EcoReality retains solicitor Henley-Walden of Sidney to oversee the proper execution of alternatives cited above.
  3. 2011-11-29: vote to approve liquidation of EcoReality assets was defeated by one investor, meaning alternative #3 is not viable unless that investor changes his mind.
  4. 2012-01-06: notification of request to allow transfer of investment shares with approval of Directors.
  5. 2012-03-17: white house rental ads placed on:
  6. 2012-06-01: white house successfully occupied by Geo Morrow.

Goal or deliverable

  • Implementation of one of the three alternatives cited above, such that
    • the solution is legally not challengeable,
    • in the case of alternative #1 or #2, the intention is that the parties eventually recoup their full investment.
  • Implementation to take place in the first half of 2012.

Timeline, schedule, or end date

  1. 2011-10-10: project started.
  2. 2011-11-29: obtain approval for alternative #3.
  3. 2011-12-23: vetting of coop rules in order to implement alternative #1 or #2.
  4. 2011-12-30: notice of any required special resolutions delivered.
  5. 2012-01-25: special resolution election meeting.
  6. 2012-01-26: submission of any required changes to coop rules.
  7. ... and then a miracle occurs...
  8. 2012-06-30: implementation of one of the three alternatives above.

Plan

  • Inform stakeholders of the situation. DONE
  • Retain legal counsel. DONE
  • Seek initial approval for alternative #3, so it doesn't need to happen later in a panic. DEFEATED
  • Seek approval of three members/directors and the three biggest investors for this plan. DONE
  • Make necessary changes to coop rules in order to implement alternative #1 or #2. DONE
  • Seek investors needed to implement alternative #1 or #2. IN PROCESS

Financial budget

Item Expense
Legal $6,000.00
Travel $500.00
Telephone $50.00
Filing Fees $255.00
Total $6,805.00


Labour budget

This project is not expected to incur any compensated labour expense. The following is provided for planning purposes only, to show how much less labour is available for other co-op business.

Item Hours
Meetings, Phone, Correspondence 200
Writing, Editing 200
Travel 20
Total 420


Time Log

next 25
WhoInOutHoursActivityAccomplishmentPaid
Jan Steinman2011-10-10 14:40:002011-10-10 16:10:001.5000Planningconf Carolno
Jan Steinman2011-10-14 14:30:002011-10-14 16:00:001.5000Networkingmet with Janis G about investor issuesno
Jan Steinman2011-10-19 10:34:002011-10-19 14:11:003.6167NetworkingJan McP about putting farm on marketno
Jan Steinman2011-10-19 15:29:002011-10-19 18:10:002.6833Consultingcontact attorneys about investor issuesno
Jan Steinman2011-10-19 18:40:002011-10-19 19:32:000.8667Consultingmore investor issuesno
Jan Steinman2011-10-24 09:55:002011-10-24 11:09:001.2333ConsultingDale Henley about investor issues (phone)no
Jan Steinman2011-10-27 07:22:002011-10-27 14:26:007.0667Consultingmet with lawyers about investor issuesno
Jan Steinman2011-11-01 13:00:002011-11-01 14:50:001.8333ConsultingDominique on investor issuesno
Jan Steinman2011-11-06 16:40:002011-11-06 18:45:002.0833Consultinglawyer about investor issuesno
Jan Steinman2011-11-08 09:00:002011-11-08 10:18:001.3000Correspondingshareholder email re: liquidationno
Jan Steinman2011-11-10 11:20:002011-11-10 12:00:000.6667Planningliquidation stuffno
Jan Steinman2011-11-11 15:50:002011-11-11 18:09:002.3167Planningsetting up database of shareholdersno
Jan Steinman2011-11-14 12:30:002011-11-14 18:06:005.6000Preparingfigure out shares for liquidation voteno
Jan Steinman2011-11-17 10:31:002011-11-17 12:22:001.8500NetworkingOsha callno
Jan Steinman2011-11-26 13:00:002011-11-26 18:00:005.0000WritingEcoReality Class A voting infono
Jan Steinman2011-11-27 13:00:002011-11-27 18:00:005.0000Planningplanning for Tuesday's shareholder voteno
Jan Steinman2011-11-29 09:00:002011-11-29 09:30:000.5000PlanningMeeting to vote to liquidateno
Jan Steinman2011-11-29 14:00:002011-11-29 18:00:004.0000Entering Dataentering minutes and reports of special meetingno
Jan Steinman2011-12-07 13:00:002011-12-07 14:19:001.3167Correspondingdealing with Ron's problems, lawyer letter, Ron letter, researchno
Jan Steinman2011-12-14 10:20:002011-12-14 15:23:005.0500Planningmeeting minutes and legal researchno
Jan Steinman2011-12-15 09:06:002011-12-15 12:00:002.9000Writingmeeting minutes and correspno
Jan Steinman2011-12-15 14:40:002011-12-15 15:00:000.3333Telephone/VideoRon message, his Internet downno
Jan Steinman2011-12-16 09:50:002011-12-16 12:13:002.3833Writingwork on formal transitional project page to properly document the history and recent goings-onno
Jan Steinman2011-12-26 14:58:002011-12-26 16:13:001.2500Researchingco-op rules, lawyer letterno
Jan Steinman2011-12-28 08:40:002011-12-28 09:00:000.3333NegotiatingMet with Ron, who was very abusive; insists a court will force us to "share" the land; insists he is a director because he signed the mortgage.no
next 25

Vehicle Log

next 25
WhoVehicleDateDist/TimeCostPurposeNotesPaid
Jan SteinmanBlue Jetta2011-10-2721 km$7.980EcoRealityDale Henley, Sidneyyes
Carol WagnerBlue Jetta2012-06-1228 km$10.640EcoRealitycredit union for Ron, grocyes
next 25

Summary

by person

IDWhoHours
2Jan Steinman181.7
2TOTAL:181.7

by activity

IDActivityHours
1Administering1.7
28Consulting16.9
46Controlling Pests48.1
16Corresponding11.1
39Delivering2.5
33Entering Data4.0
19Hospitality4.9
5Managing Information0.5
24Negotiating27.0
20Networking7.0
7Planning15.0
15Preparing20.5
11Researching4.1
31Review5.3
25Telephone/Video3.0
32Writing10.3
32TOTAL:181.7

by vehicle

"Vehicles" with no odometer, such as tractors or stationary equipment, are in tenths of an hour, rather than kilometres.

IDVehicleDistance
1Blue Jetta49 km
1TOTAL:49 km


Final accounting

Item Expense
Total

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