Willard & Kelsey Solar Group -- a firm whose executives lent or paid themselves about $1.4 million in company funds -- owes almost $1.5 million in back loan payments to the state of Ohio.
The Perrysburg solar-panel manufacturer began missing loan payments in December of last year.
Since then, Willard & Kelsey consistently has missed or failed to make full payments to the Ohio Department of Development and the Ohio Air Quality Development Authority.
Those actions violate the terms of the company's loan agreements with both state agencies and add to a laundry list of problems faced by the firm, which has received $10.5 million in state funding.
An ongoing Blade investigation revealed executives paid or loaned themselves as much as $40,000 a month and spent company funds on trips to sporting events, airline tickets for family members, and luxury furniture in 2008 and 2009. Former Willard & Kelsey Chief Executive Officer William Mitchell also wrote in personal emails and communications that company officials were paid with funds from a $5 million loan from the state Department of Development. If true, the practice would violate the firm's loan agreement.
Mr. Mitchell was fired from Willard & Kelsey in 2009 and died in 2011.
The company owes $1,172,065 to the Ohio Air Quality Development Authority, and $313,144 on the Department of Development loan.
Some of the company's solar-panel machinery could be seized as collateral on the Department of Development loan if Willard & Kelsey fails to pay a substantial part of what it owes by Aug. 29. The company missed payments in June and July and only paid the interest and servicing fees in May, which triggered a 120-day collection clause in its loan agreement.
State Department of Development spokesman Katie Sabatino said officials had not decided how they will collect the money the department loaned to Willard & Kelsey.
The department also is reviewing an audit of the company's finances dating back to March, 2009 -- the same month the company received its first round of state funding.
"When there is a breach of the agreement, the [Ohio Department of Development] works with the company to determine a remedy. If no solution can be reached, then a formal demand is made on our end. If there is still no response, the next step is to turn it over to the [attorney general's] office for collections," state Department of Development spokesman Stephanie Mennecke wrote in an email.
The department's audit, along with a letter from Willard & Kelsey, will be used to determine the company's fate, Ms. Sabatino said.
The April 30 letter from Willard & Kelsey, which was signed by Vice President of Development Mossie Murphy, asks the Department of Development to delay the date for the company's 2011 audited financial statements to July 31, defer principal loan payments until January, 2013, and reduce the job creation requirement to 100.
A crucial part of Willard & Kelsey's loan agreements with the state was the creation of about 400 jobs.
Willard & Kelsey has received extensions to submit financial statements and payments to the department in the past.
"We're still reviewing the letter," Ms. Sabatino said, adding that the department would comment on it when it had a better understanding of Willard & Kelsey's financial position.
Mr. Murphy did not answer questions emailed to him by The Blade, citing that he was out of town. He also did not answer a follow-up email seeking a phone conversation or written response. Michael Cicak, Willard & Kelsey's CEO and president of the board, and Marvin Robon, the company's Maumee lawyer, did not respond to a call and an email from The Blade.
The Air Quality Development Authority is taking a similar approach to the state Department of Development in its dealings with Willard & Kelsey and is investigating the financial viability of the company.
Officials said no decision has been made as to how it will proceed, as its look into the company's finances is ongoing. Willard & Kelsey is $1,172,065 behind in its payments.
Todd Nein, the interim executive director of the authority, said the agency hired GBQ Partners LLC in May to assess whether Willard & Kelsey could survive and pay its loan back. No firm finish date has been set for the completion of the GBQ investigation, Mr. Nein said.
"The term of the loan is up in September, so do we let the term come and not make any changes? Do we change it and give them more time? Do we call it early? That's what GBQ is helping us decide," he said.
Mr. Nein said GBQ also would assess the value of the firm's equipment, which is collateral on the authority's loan. The Department of Development said it has not gauged the value of the equipment at Willard & Kelsey.
The authority and the state Department of Development have been in touch with each other but are going about their dealings with Willard & Kelsey independently, Mr. Nein said.
"It's not so much why they deserve a second chance, but it's more of what's the best way for the state do recover the funds that have been loaned."
Source: http://www.toledoblade.com/Energy/2012/07/22/Solar-group-owes-Ohio-almost-1-5M.html
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| Willard & Kelsey Solar Group of Perrysburg began missing loan payments to the state in December, 2011. The firm consistently has missed or failed to make full payments to the Ohio Department of Development and the Ohio Air Quality Development Authority. |
The Perrysburg solar-panel manufacturer began missing loan payments in December of last year.
Since then, Willard & Kelsey consistently has missed or failed to make full payments to the Ohio Department of Development and the Ohio Air Quality Development Authority.
Those actions violate the terms of the company's loan agreements with both state agencies and add to a laundry list of problems faced by the firm, which has received $10.5 million in state funding.
An ongoing Blade investigation revealed executives paid or loaned themselves as much as $40,000 a month and spent company funds on trips to sporting events, airline tickets for family members, and luxury furniture in 2008 and 2009. Former Willard & Kelsey Chief Executive Officer William Mitchell also wrote in personal emails and communications that company officials were paid with funds from a $5 million loan from the state Department of Development. If true, the practice would violate the firm's loan agreement.
Mr. Mitchell was fired from Willard & Kelsey in 2009 and died in 2011.
The company owes $1,172,065 to the Ohio Air Quality Development Authority, and $313,144 on the Department of Development loan.
Some of the company's solar-panel machinery could be seized as collateral on the Department of Development loan if Willard & Kelsey fails to pay a substantial part of what it owes by Aug. 29. The company missed payments in June and July and only paid the interest and servicing fees in May, which triggered a 120-day collection clause in its loan agreement.
State Department of Development spokesman Katie Sabatino said officials had not decided how they will collect the money the department loaned to Willard & Kelsey.
The department also is reviewing an audit of the company's finances dating back to March, 2009 -- the same month the company received its first round of state funding.
"When there is a breach of the agreement, the [Ohio Department of Development] works with the company to determine a remedy. If no solution can be reached, then a formal demand is made on our end. If there is still no response, the next step is to turn it over to the [attorney general's] office for collections," state Department of Development spokesman Stephanie Mennecke wrote in an email.
The department's audit, along with a letter from Willard & Kelsey, will be used to determine the company's fate, Ms. Sabatino said.
The April 30 letter from Willard & Kelsey, which was signed by Vice President of Development Mossie Murphy, asks the Department of Development to delay the date for the company's 2011 audited financial statements to July 31, defer principal loan payments until January, 2013, and reduce the job creation requirement to 100.
A crucial part of Willard & Kelsey's loan agreements with the state was the creation of about 400 jobs.
Willard & Kelsey has received extensions to submit financial statements and payments to the department in the past.
"We're still reviewing the letter," Ms. Sabatino said, adding that the department would comment on it when it had a better understanding of Willard & Kelsey's financial position.
Mr. Murphy did not answer questions emailed to him by The Blade, citing that he was out of town. He also did not answer a follow-up email seeking a phone conversation or written response. Michael Cicak, Willard & Kelsey's CEO and president of the board, and Marvin Robon, the company's Maumee lawyer, did not respond to a call and an email from The Blade.
The Air Quality Development Authority is taking a similar approach to the state Department of Development in its dealings with Willard & Kelsey and is investigating the financial viability of the company.
Officials said no decision has been made as to how it will proceed, as its look into the company's finances is ongoing. Willard & Kelsey is $1,172,065 behind in its payments.
Todd Nein, the interim executive director of the authority, said the agency hired GBQ Partners LLC in May to assess whether Willard & Kelsey could survive and pay its loan back. No firm finish date has been set for the completion of the GBQ investigation, Mr. Nein said.
"The term of the loan is up in September, so do we let the term come and not make any changes? Do we change it and give them more time? Do we call it early? That's what GBQ is helping us decide," he said.
Mr. Nein said GBQ also would assess the value of the firm's equipment, which is collateral on the authority's loan. The Department of Development said it has not gauged the value of the equipment at Willard & Kelsey.
The authority and the state Department of Development have been in touch with each other but are going about their dealings with Willard & Kelsey independently, Mr. Nein said.
"It's not so much why they deserve a second chance, but it's more of what's the best way for the state do recover the funds that have been loaned."
Source: http://www.toledoblade.com/Energy/2012/07/22/Solar-group-owes-Ohio-almost-1-5M.html
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