ERON MORTGAGE INFORMATION WEBSITE
THE ERON LENDER COMMITTEE

MINUTES OF MEETING - JUNE 1, 1999
ELC-PROJECTS & LENDERS Monthly Meeting

 1. At 7: 05 pm James Tindle welcomed the lenders and briefly outlined the evening's agenda, noting the presence of the media.

Ripley asked the lenders if they wished to make any special arrangements with respect to the BCTV cameraman. Some lenders rearranged their seating. Ripley remarked the presence of Fabian Dawson of the "Province", and complimented him on his recent articles.


2. David Craig spoke at length and in detail about the preparations being made by PWC and himself for the lenders to take advantage of the provisions C. Bushell (PWC) had negotiated with Revenue Canada. He specified the stages of the distribution plan by the degree of likely % recovery, beginning with the zero- %-return projects, in which a lender's choice with respect to the Revenue Canada option is straightforward. For the higher % return projects the calculation of any lender's highest net return will be somewhat more complex depending upon their tax bracket ( see item #2, of the June 1/99 "Newsletter"). A number of questions were asked of Craig answers to which were not available to him at the time; he said he would respond to lenders when he had the answers.


3. Tindle described the present litigation efforts of PWC / R&D against the Slobogians, Billers, and D. Jackie (see item #3, "Newsletter" June1,'99). The Slobogians have offered PWC and Eron lenders a "formal Proposal under the Bankruptcy and Insolvency Act", and the ELC has rejected this settlement for a variety of reasons. Slobogian's bankruptcy hearing occurs June 2. The Billers have been served with an amended Statement of Claim in the amount of $6.5M, which alleges fraud and breach of trust. Jackie is the object of multiple lawsuits: how much Eron lenders may receive from his insurance is a matter being negotiated by PWC.

Tindle noted that Eron lenders through the ELC can submit to Justice Tysoe an Affidavit asking the Court to order PWC / R&D to answer questions that have not been answered so far by them about certain notable indirect costs. In any event, Eron lenders must try to keep their costs down through the final stages of the Trusteeship.


4. Tindle elaborated on the important distinctions between Eron lenders' direct costs, indirect costs, and allocation of costs (see item # 4, June 1 Newsletter). To date, the direct costs = $7.4M, the indirect costs = $7.0M, which amounts include the discount already negotiated by D. Craig for the Nov. / 98 interim passing of accounts. Tindle remarked that it might be asking too much of D. Craig to be able to review all the projects' direct-costs complaints. In any event, it was the job of the ELC to review questions about the indirect costs. The allocation-of-costs formula has already been given by Tysoe, but may be subject to variance if the projects were able to offer a unified alternative plan to the Judge (see item #2, June 1 "Newsletter").

Craig commented on Tindle's remarks. He noted that his quasi-taxation / discount arrangements with PWC allowed for identifiable errors to be corrected, and for criticism and arbitration if demonstrable failures were evident in PWC's management and protection of a project's assets. Also, if the overall level of indirect costs is believed to be excessive, Eron lenders have the option of some further taxation appeal to the Court in the final stages of the Trusteeship.

5. Ripley began his discussion of Communications topics by asking the lenders to look at the evening's information handout titled "ELC Candidates "-the election form of Nov.'98- in which his communications responsibilities were described. He then noted that six months had passed since the New ELC was elected, and invited the lenders to offer feedback to him on their evaluation of his work for them during the first half of the year- considering that he was the only member of the ELC receiving an honorarium. (the specifications of the Court submission and approval of which were noted on the reverse side of the "ELC Candidates" page). He asked if they would prefer he re-direct his priorities of work, or make other changes in order to better serve their interests. He remarked that the communication tasks had prevented him from attending as often as he might have preferred the sessions of the BCSC; fortunately a small band of stalwart lenders led by ELC Chairman J. Tindle , Jack Rockandel and Anthony Jasich have been able to attend daily to demonstrate to the BCSC panel Eron lenders support of Sasha Angus' hard investigative work and the BCSC process.

As no comments were offered by the lenders Ripley closed by encouraging them to contact him by phone if they wished to offer any thoughts on the progress of his work on their behalf. Ripley then directed the lenders' attention to a number of items in the June 1/99 "Newsletter"; in particular he noted item # 31, inviting the lenders to contact himself or other members of the ELC during the July- August period when no project lenders' meetings were scheduled. Other important upcoming dates were also noted. The BCSC Investor Kit was briefly reviewed, with attention directed to the pamphlets it contained, including those describing 'how to spot a con artist'.

Ripley asked the lenders to commit to becoming part of a further development of the telephone -tree organization, and Wendy Menghi passed around to the lenders the lists by which the plan was to be effected.

6. Other miscellaneous questions were asked and answered.

7. The meeting adjourned at about 9:00 pm, with several sub-groups of lenders' projects meeting thereafter to discuss developments in their affairs; for example, Brigid Dunbar had excellent news to report to the Discovery Ridge lenders. Brief discussions also occurred re. Gateway, Dunsmuir, Nexus, and Sterling.


Secretary: S. Ripley ( 222-1646 )





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