RWSSC's "Shareholder Request For Information" Documents Extensive
by Blanche Evans
Philip C. Stahl, Grippo & Elden LLC, represents the Realtor Association of West / South Suburban Chicagoland (RWSSC), a shareholder in MLSNI. The Chicago-based law firm specializes in "high-stakes commercial litigation for major U.S. companies." He has requested 24 items of documents in the Shareholder's Request for Information that he has delivered to the Multiple Listing Service of Illinois, Inc.
In a Shareholder's Request For Information, the RWSSC requests:
The identity of the officers and managers (or governors, or their equivalent) of Multiple Solutions, LLC from its formation through the present; and a copy of Multiple Solutions’ Operating Agreement.
Information about the scope of responsibility and authority of the Executive Committee of MLSNI’s Board of Directors.
Information provided to members of the Board of Directors and/or Executive Committee before either body considered any matter relating to REBIG, Mr. Huffman’s employment agreement (for the period January 1, 2002 through the present, including any extension or amendment), or Ms. Huffman’s consulting agreement (including any extension or amendment). (PWX Report, pp. 11-14)
Minutes of the meetings (or written consents in lieu of meetings) of the Company’s Board of Directors and/or Executive Committee at which any action was taken on any matter relating to REBIG, Mr. Huffman’s employment agreement (during the period January 1, 2002 through the present, including any extension or amendment), or Ms. Huffman’s consulting agreement and any extension or amendment. (PWC Report, pp. 11-14)
Information relating to instructions or authority granted to Mr. Huffman by the Board of Directors or Executive Committee in connection with:
Negotiations with Ms. Huffman regarding her consulting agreement with MLSNI; and
Negotiations regarding MLSNI/MS’ investment in and relationship with REBIG or the terms of REBIG’s Operating Agreement. (PWC Report, pp. 11-14, 19-24)
Information about any matters on which Mr. Huffman declined to act with respect to REBIG or any agreement with Ms. Huffman, Dona, LLC or her other affiliates; and information on who protected MLSNI’s interests on such matters. (PWC Report, pp. 19-24)
Information on the reasons that MLSNI insisted that Ms. Huffman be REBIG’s Chief Executive Officer. (PWC Report, Tab 5)
Information about (and a detailed description of ) the specific items of intellectual property developed by Ms. Huffman in her capacity as a consultant to MLSNI. (PWC Report, pp. 19-24, Tab 5)
Information about the Confidentiality Agreement between REBIG and Multiple Solutions, LLC, including communications with third parties (e.g., professional advisors) concerning the interpretation, consequences or legality of such an agreement, particularly as it related to Mr. Huffman’s ability to keep MLSNI’s directors informed about REBIG in fulfillment of his fiduciary duties to MLSNI and its shareholders and the officers’ and directors’ duties of care.
Information about MLSNI’s decision whether or not to implement materials and concepts developed by Ms. Huffman in her capacity as a consultant to MLSNI within 120 days after the term of her Consulting Agreement; the identity of the individual(s) who made that decision and, if that person was Mr. Huffman, whether he informed the Board of Directors of Executive Committee of the foregoing. (PWC Report, Tab 5)
Valuations or appraisals of any intellectual property developed by Ms. Huffman in her capacity as a consultant. (PWC Report, pp. 19,26)
Information about Board of Directors or Executive Committee deliberations considering whether the following were fair to MLSNI and its shareholders given the Company’s investment in REBIG compared to REBIG’s other members:
Limiting the Company’s investment in REBIG to 49%;
Advancing funds to REBIG without collateral, without the ability to declare a default of the obligation except under limited circumstances, and without obtaining a preferred position relative to other members who did not make advances;
Agreeing to participate in REBIG without rights at least as favorable as those of Dona, LLC (e.g., Dona, LLC’s put right and anti-dilution protection in the REBIG Operating Agreement);
Insisting that Ms. Huffman be REBIG’s Chief Executive Offer;
Agreeing to Sections 5.4(a) of REBIG’s Operating Agreement, which provides that REBIG’s Board of Governors has no authority to interfere with Ms. Huffman’s responsibilities as Chief Executive Officer (not withstanding the Governors’ fiduciary duties to REBIG’s members);
Allowing Ms. Huffman to use a license for intellectual property she developed for the benefit of MLSNI as Dona, LLC’s capital contribution to REBIG; and
Agreeing to the disparity in value attributed to the Company’s intellectual property as the Company's capital contribution to REBIG compared to the value attributed to the intellectual property Dona, LLC licensed. (PWC Report, pp. 19-24)
Information about advice provided by third parties advising the Company’s Board of Directors or Executive Committee concerning each of the matters in #12.
Information about the terms of the loans or advances and related promissory notes between MLSNI and REBIG, including the negotiations to establish the terms thereof, the identities of the persons negotiating on behalf of MLSNI and REBIG, the identity of the person or entity who drafted the notes, and information on whether preparing such notes was within the expertise of such person or entity. (PWC Report, pp. 21-24)
Information about advice provided by third parties to the Company’s Board of Directors or Executive Committee concerning the requirements of the Illinois Business Corporation Act and related common law as to the officers’ and directors’ duties of care, disclosure and loyalty to MLSNI in connection with the Company’s investment in and relationship with REBIG, the terms of REBIG’s Operating Agreement, Mr. Huffman’s employment with the Company and/or Ms. Huffman’s engagement as a consultant for the Company, and whether such transactions were fair to the Company. (Illinois Bus. Corp. Act, Sections 8.05, 8.06)
Valuations or appraisals of the value of the investment in REBIG or other information bearing on whether the REBIG transaction, Mr. Huffman’s employment agreement (including any amendments) and Ms. Huffman’s consulting agreement (including any amendments) were fair to the Company. (Illinois Bus. Corp. Act, Section 8.60)
Information provided to the Board of Directors or Executive Committee regarding Ms. Huffman’s investment in REBIG or her compensation, duties, or performance as REBIG’s CEO.
Information provided to the Board of Directors or Executive Committee regarding the process of selecting REBIG’s CEO, including duties and compensation.
The Company’s directors and officers insurance policies and errors and omissions policies, in each case covering the periods from January 1, 2002 through the present.
Information about the terms of the Company’s engagement of Arnstein & Lehr from January 1, 2002 through the present, including engagement letters.
All disbursements (regardless of the stated purpose) made by or on behalf of the Company to either REBIG, Mr. Huffman or Ms. Huffman. (PWC Report, p.26)
All potential investors in REBIG, including the identities of potential investors who declined to invest and the reasons for their decisions.
The total number of shares of stock of MLSNI that are issued and outstanding; the number of shares owned by each record owner; and the voting power associated with those shares.
The identity of the voting members of the Board of Directors and Executive Committee of MLSNI from January 1, 2002 through the present.
Published: September 21, 2004
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Blanche is a renowned author of five real estate books. Her newest, Bubbles, Booms and Busts: Make Money In Any Real Estate Market, McGraw-Hill, was rave-reviewed by The New York Times. She was also selected from hundreds of real estate experts to contribute to Donald Trump's book, Trump: The Best Real Estate Advice I Ever Received: 100 Top Experts Share Their Strategies, Rutledge Hill Press, and is featured on page 68.
In 2006, Blanche was selected among scores of candidates to author two consumer real estate guidebooks for the National Association of Realtors: The NAR Guide to Home Buying, and The NAR Guide to Home Selling, Wiley & Sons. She is currently planning two new books for the NAR and its members.
Known for her keen insight into real estate industry issues and for her ability to make complex subjects easy to understand, Blanche is a sought-after keynote and continuing education speaker. Real estate organizations from MLSs, to brokerages, to franchisors, to associations hire her to provide up-to-the-minute analysis of real estate industry news and advice on how to improve revenues. Her passionate delivery, peppered with stinging wit, is a huge hit with audiences and fans.
Don Klein, CEO Greater Nashville Association of Realtors, Blanche Evans, Richard Courtney, president 2007, GRAR
"The GNAR membership meeting last week featured Blanche Evans as the keynote speaker. Her comments and insights resonated extremely well with those in attendance and we have had many requests for copies of her PowerPoint Presentation. She was a terrific part of the membership meeting and convention program!" - Don Klein, CEO Greater Nashville Association of Realtors
Blanche is a renowned author of five real estate books. Her newest, Bubbles, Booms and Busts: Make Money In Any Real Estate Market, McGraw-Hill, was rave-reviewed by The New York Times. She was also selected from hundreds of real estate experts to contribute to Donald Trump's book, Trump: The Best Real Estate Advice I Ever Received: 100 Top Experts Share Their Strategies, Rutledge Hill Press, and is featured on page 68.
