Free Declaration - District Court of Arizona - Arizona

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j»_ Case 2:02-cv-02099-RCB Document 345-72 Filed O3/10/2006 Page10f3

Board Meeting
. March 20, 2001 _
Attendees: Rhodes, Makings, Yih, Nolan, Eaton, Cunningham
Chris Kirk and Tom Gilman were not on the Board call as Chris Kirk was removed {rom
the Board on March 1 5. GTCR had requested to stay on the Board as their nominee to ··
help with the efforts of selling LeapSource. ’
Torn Gilman gave his verbal resignation to GTCR on March 15. Ioe Nolan placed a call
to him on March 19 continuing his resignation and requesting that Tom submit it in
writing.
Makings noted the letter was received trom GT CR. that informed LeapSource that all j
‘ funding except for approximately $700k for payroll will stop and that LeapSource should
begin to transition the operations back to its clients.
-;, Makings noted that he wants to make sure that LeapSource has the appropriate time to
transition in an effort to reduce its liabilities as a company. He does not believe that the
timing of March 21, 2001 for the announcement to employees is adequate time. He
doesn’t support or believe in a rush effort to transition because it is not enough time to Q
_ e&`ectively transition back to clients in a responsible manner. He doesn’t want
O preferential treatment to certain client and personnel by allowing Comsys to talk with the
· » Cornsys client personnel and offer them jobs. Making noted that it was Willis, CEO of t
Comsys intention to visit Rockville on March 21 to offer people jobs and announce the
shut down of LeapSource.
i
Eaton agreed and wants the announcements to be managed by LeapSource to ensure that
all employees and clients are treated that same. Mike seconded this.
Makings noted that he was concerned about insurance, liability, facility, payroll and
benetit matters and cited that it would take time to reasonably transition and plan for
these matters so to mitigate LeapSource and its representatives liability. He stated that
LeapSource and its management needed more time for an orderly transition.
Nolan and Yih agreed and noted that these were reasonable requests to ensure that clients
were treated in the same manner and to provide for orderly transition.
Nolan agreed to place a call to Willis to have him hold oft` on the trip and announcement
to Rockville. Nolan advised him that Willis should try to come to agreement with
LeapSource prior to having those discussions because he will need LeapSource to have
an effective transition. _
Nolan stated that as CEO Makings had the right to plan the transitions, direct Willis not
to have meetings and to manage the transitions. Makings noted that at this juncture
. = he would call Willis but that he did not think he would be successful in stopping Willis.
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Case 2.02-cv—O2099-RCB Document 345-72 Filed O3/10/2G0&06 Page 2 of 3

Nolan also continued that GTCR in no way implied to Willis that he had the authority to C
r 4; make the announcement.
Malrings updated the Board that all clients had been notified and that initial transition
plans have begun. He informed the Board that we offered to help the clients get them
outsourced, to transition people and house at the current facility, or with any other
transition plan. '
Makings informed the Board that he is preparing an agreement to purchase certain ICG
assets. Eaton said that he had discussed the transaction with bankruptcy counsel and
under the circumstances all parties could get comfortable with the transaction and being
at arms length.
The SCC facility was discussed to determine if G-TCR should assume the lease because
of its guarantee on it and sublease to the clients or if LeapSource should manage the
allocation ofthe cost of the lease to current clients. This matter was tabled as it was
~ determined it is not a Board matter.
Eaton emphasized that the only major risk is to get the employees hired and get the
contracts assigned and to empty the company of the assets. It was not a priority to
actually lile Chapter 7 immediately. p.
j A Eaton wanted to confirm what the letter received from G-TCR noting a thnding up to
i"°i ft $700lc exactly meant as far as a commitment. `
GTCR coniirmed that we have to choose a cut off date so that LeapSource is no longer
liable for expenses and minimize on the $700k draw. Alter the cut ol? date, the client
will be liable for all expenses. 7
Nolan noted that the amount that GTCR agrees to fund was not the issue and that
LeapSource management should be focusing on colleting as much as possible fiom the
clients for LeapSource to timd payroll and to minimize the draw.
Nolan made a notion that David Eaton should be elected Chief Recovery Ofltlcer. Yih
and Rhodes seconded.
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