Poor Gil Gutknecht. After his perfect hair couldn't rescue his faltering 2006 campaign from Tim Walz's youthful army of volunteers, the former auctioneer bounced into the energy sector, hooking up with Bixby Energy.
The past few weeks have chronicled Gutknecht's struggles with Bixby CEO Bob Walker; today's Strib coverage notes major changes in Bixby CEO, others resign:
The departures come amid lawsuits and federal probes into the dealings of the insolvent energy company, which has a technology that promises to convert coal into natural gas.
The chief executive, corporate counsel and two directors of Bixby Energy Systems have resigned in the face of federal criminal and civil investigations and lawsuits alleging gross mismanagement of the Ramsey, Minn.-based company.
The departures of founder and CEO Bob Walker and the others were announced at a court hearing Tuesday, settling two civil lawsuits that revealed the 10-year-old company was insolvent and unable to supply customers in China. The company's technology promises to convert coal to natural gas.
Former U.S. Rep. Gil Gutknecht and Illinois businessman James Bergeron, whose suit against Bixby, Walker and others was dropped, will remain on the board of directors and be joined by Ronald Kinner, the company's chief financial officer and a former board member.
Gutknecht appears to be the victim of the unscrupulous and is cooperating with the investigations:
Others leaving Bixby are Peder Davisson, corporate counsel, and board members Peter Wood, a former director of a British company who left its board after a business scandal, and Kenneth Casavant, a Washington State University agricultural economics professor who is Walker's brother-in-law.
Bixby also has terminated all relationships with Dennis DeSender, a consultant who helped raise $60 million from investors. DeSender has convictions for bank fraud and theft by swindle, and recently pleaded guilty to tax evasion. . . .
Attorneys for Gutknecht and Bergeron said their clients have been cooperating with the SEC investigation and are scheduled to meet with the agency again this week.
However, the paper reports that there are some complications and distrust of Gutknecht on the part of some stockholders in the faltering company:
The two suits also alleged that Bixby had accumulated $141 million in losses and that Walker had put his relatives on the payroll, spent recklessly and left suppliers unpaid.
Global Partners United LLC, a company with a contract to market Bixby's technology in Asia, also dropped a separate lawsuit against Bixby and committed to $2.9 million in interest-free loans to Bixby to pay suppliers and assure the delivery, installation and testing of the first five coal-gassification units, said its attorney, David Davenport. With those payments Global Partners will have put nearly $9 million into Bixby, he said.
Even so, some investors didn't trust Global Partners, fearing it was trying to take over Bixby and steal its technology -- an allegation Davenport said is false. One of the three partners in the marketing company is a former aide to Gutknecht, which some investors see as a potential conflict of interest. But Davenport and others said Gutknecht, through that relationship, introduced Bixby to its most important business deal.
Alan Malley, a former Bixby employee from Coon Rapids who invested in the company in 2008, said "I cringe when I think of Gil Gutknecht and Jim Bergeron being on the board." He said he still believes that Walker worked on behalf of investors. He said he hopes shareholders eventually can elect a board they trust.
An earlier report, Mystery investor, and doubts, at Bixby, provides other details:
The battle for control of a Minnesota energy company took a bizarre twist Friday with allegations that its top executive is engineering a boardroom coup with the help of a mystery investor who may not exist.
Two directors of Bixby Energy Systems wrote a letter to shareholders describing alleged machinations by CEO Bob Walker to maintain control of the Ramsey company.
The same two directors -- one of them is former U.S. Rep. Gil Gutknecht -- sued Bixby, Walker and others last month, alleging that the company was grossly mismanaged, insolvent and under federal investigation.
Seriously, Gil hasn't kept such dubious company since his days working with John Wayne Gacy or having David Brum around the house in Rochester.
It's about time! Now Bixby can finally get on track and move the world, one lump of coal at a time.
Shame on the exiting Bixby Board. So cowardly scandalous..
Great day for it's shareholders though. Good for them.
Now lets see some clean coal for crying out load and get those nay-sayers to shut their yaps!!!!!!
Posted by: CoAlchemy | May 12, 2011 at 12:35 AM