In exchange, it got back $112 million in assets and got out from under the 40-year contract that would have cost it $170 million over time. The settlement required Cobb EMC to pay $47 million to buy out Cobb Energy shareholders, including Brown assume Cobb Energy's liabilities and buy out Cobb Energy's contract with Brown. The lawsuit was settled in December 2009 under terms that galled some plaintiffs even as they signed off on the deal. Maddox filed the first lawsuit against the co-op and its affiliate in September 2007, then withdrew it to join a second lawsuit, filed the next month by Cobb County businessmen Edgar "Bo" Pounds and Butch Thompson and others. The hike took effect five days after Cobb Energy announced that it would pay $20 million for naming rights at the Cobb Energy Performing Arts Center. Even a committee of co-op board members later questioned one of Brown's actions, a 2005 decision to nearly double the markup the co-op paid Cobb Energy without co-op board approval. The co-op, which owned roughly 30 percent of Cobb Energy's stock, received no dividends.
Some co-op board members also owned dividend-paying preferred stock in Cobb Energy. Some of the co-op's "volunteer" board members were also well compensated, receiving $107,000 to $130,000 in retirement benefits upon joining the board. Add his salary, the $265,000 per year he received in Cobb Energy stock dividends and the loan forgiveness, and Brown's annual compensation was about $1.2 million. The $3 million loan is being gradually forgiven. He also was a preferred stockholder in Cobb Energy, having purchased $3 million worth of the company's stock using loans from the co-op and Cobb Energy. īrown was CEO of both companies, drawing a $300,000 annual salary from each. The company's profts was the operating contract with Cobb EMC. Most of the ventures lost money, court documents said. It also started ventures - including mortgage brokering, private security and pest control - far outside its core electric business. Cobb Energy charged a markup, which rose from 2 percent to 11 percent. As outlined in the AJC articles, and later fleshed out in court, the co-op had turned over its work force and its electric meters to a for-profit company called Cobb Energy in 1998, giving that company a 40-year contract to operate its electric business. The first lawsuit was filed the next month.
EXCELSIOR EMC PAY SERIES
In 2007, east Cobb County resident Sims Maddox stood up at a meeting and asked Cobb EMC CEO Dwight Brown: “Who are we in bed with? I want to know." The question was in response to a series of articles by the Atlanta Journal-Constitution (AJC) which first raised questions about Cobb EMC in late August 2007 based on arrangements that appeared to create financial conflicts of interest. 1.1 January 2011: Power4Georgian Organizer Dwight Brown indicted.
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