Results from a May 10 Ideal Development Corp. shareholders meeting at Ideal Township Town Hall were in favor of the existing board of directors and its operation of the Whitefish Golf Club in Pequot Lakes.
Five proposals were voted on during a 2-1/2 hour meeting. The first being the removal of Jim Gammello from the existing nine-person board. Board president Ted Silva said that proposal was approved by more than 6,000 of the 11,153 common stock shares.
"Nothing surprises me," Gammello said Tuesday. "I have not seen the voting results. My lawyers have asked for them and I have asked for them a couple of times. I've been told what happened by the president."
Gammello was not present at the meeting, but did vote through proxy. He said the meeting was illegally called and will become a matter for the courts.
"That's where the final decision will be made," he said.
Silva said the meeting was originally requested by Gammello and three other shareholders. The May 10 date was set by a special committee consisting of eight of the board members minus Gammello. With court approval, Gammello moved the meeting to April 5. Because a majority plus one of the 11,153 common stock shares were not voted at the April 5 meeting no legal action took place according to Crow Wing County Judge Robert Zimmerman's court ruling.
The committee decided to still hold the May 10 meeting with the previous agenda. At two regular board meetings, April 4 and April 28, the board members voted to hold the special shareholder meeting. Silva added that it was within the legal guidelines.
A second proposal brought from the board would change the bylaws of IDC and Silva said that passed by a similar margin.
Three proposals brought by Gammello failed. They were to remove the existing board. Replace them with six other shareholders and to change the articles of incorporation on how future boards would be formed.
"Everyone was allowed to ask as many questions as they wanted," said Silva. "No questions were shunted aside."
The conflict between eight of the IDC board of directors and Gammello stems from payment or nonpayment of dividends.
"This is a complicated item," said Gammello. "I can't answer all the questions. There isn't a clear answer to all the legal questions that have been proposed. We'll have to let the judge decide.
"I feel bad for the shareholders who were hoping to receive payment from their shares. Unless you're a golfer the board has made no provisions for the rest of the shareholders."
Silva said the "majority of shareholders have voted and overwhelmingly approve of the way the current board is operating the course."
The construction of Whitefish, which opened in 1968, was paid for by the selling of IDC Class C "for profit" shares. For the first 39 years no dividends were paid on those shares. All profits made by Whitefish are invested back into the course and clubhouse. The course was expanded to 18 holes in 1981 and more shares were sold. There are currently 11,153 shares spread among 950 shareholders.
Gammello formed Whitefish Golf Acquisition LLC and launched a tender offer on Nov. 31 to purchase up to 3,700 shares of IDC stock. Then on Feb. 15 a group of shareholders sent IDC written notice demanding that the board call a special meeting of the shareholders.
JEREMY MILLSOP may be reached at jeremy.millsop@brainerddispatch.com or 855-5856.
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