On Saturday, February 13, 2021, three days after the Club’s Annual Meeting (held on Wednesday, February 10, 2021), Club Secretary Gregg Galyo sent the mass email pasted below this editorial via the ScheduleMaster™ system in which he described the outcome of voting from that Annual Meeting. Four days later, on Wednesday, February 17, 2021, Galyo distributed the official minutes of the Club’s Annual Meeting. Unfortunately, there are substantial conflicts between Galyo’s email on February 13th and the official minutes distributed on February 17th. These and other issues represent serious problems that adversely impact the legitimacy of the Club’s operations.
74 is Greater Than 50: First, because we have comprehensively reported in previous newsletters regarding the legality of having any vote at all because the Club has issued more shares than the Articles of Incorporation allows, we won’t delve into the substance of that issue. Our view remains unchanged that there can be no lawful effect of any vote taken when the Club claims there are more than 50 shareholders. In this case, the Club declared that there were 74 eligible voters and therefore a quorum of 37 was needed for any voting. In the interest of clarity and brevity to cover the issues below, we will set aside the fact that 74 issued shares is more than the 50 authorized, and we will also ignore the Club’s calculation error in Galyo’s email (37 is not a majority of 74).
What is a Quorum?: Assuming that there were somehow 74 eligible voters, a minimum of 38 voters would constitute a quorum. This would mean that at least 38 eligible voters must be present in order for any vote to begin taking place. Most meetings conducted under proper parliamentary procedures begin with some form of “roll call” to determine who is present and if their number is sufficient to establish a quorum. Because proxy votes may be counted toward meeting the quorum requirements, such proxy forms should be presented and registered during the “roll call.” Establishing a documentary record of the presence of a quorum is a fundamental requirement to ensure the legality of any votes during the meeting. This is all described in Robert’s Rules of Order, the parliamentary procedures that Greg Gilhooly said the Club must follow when he was running for office in February 2020, but are not being followed well, if at all. It is noteworthy that Galyo’s email on February 13th never states a quorum was ever present. The official minutes to the Annual Meeting distributed on February 17th do not even mention the word “quorum,” nor do they provide a list of at least 38 eligible voters (in person or by proxy) who would have been necessary to make up that quorum. In fact, only the names of 24 people are provided in the official minutes, and there is no mention of proxy votes at all. The effect of what the Club has transmitted relative to having a quorum is that no voting should have ever commenced. Furthermore, it means that any vote that did commence at the Annual Meeting was not compliant with the By-Laws. Therefore, the outcomes of those votes are entirely illegitimate and without any legal force and effect.
The Club’s By-Laws Specifically Establish Quorum Requirements: Article I prescribes that “it shall be necessary that stockholders, representing in person or by proxy, consisting of a majority of the stockholders shall constitute a quorum.” Assuming that there were somehow 74 eligible voters, this By-Laws passage would require at least 38 eligible voters to be physically present (in person or by proxy) at the beginning of any vote through the tally of that vote. It’s not enough that a total of 38 people could be present (in person or by proxy) during the period the meeting was being held. It now seems clear there was never a quorum present.
Galyo’s email on February 13th asserts only 29 members were present in person or via Zoom, and the official minutes distributed on February 17th reflect that only 24 members were claimed to be present in person or via Zoom. The official minutes list 24 members present in person or via Zoom by name. The last page of the official minutes state that “a few more showed [up] at [the] hangar late,” but does not identify these supposed additional attendees or whether they were eligible to vote. Even though someone who “showed up late” to the start of the meeting might still be able to vote, if they were needed to establish a quorum, their presence would be necessary prior to commencing each vote. It is clear that the information in the official minutes distributed on February 17th contradicts Galyo’s claim in his February 13th email that, “we had 20 plus members show at the hanger [sic] and another 9 online.” Additionally, the official minutes do not identify any members represented by proxy. In fact, there is no mention in the official minutes at all about proxy votes, and they don’t even distinguish who was present at the hangar versus via Zoom. Since the Club claims that 40 votes were cast for all five incumbents, that means that the Club would have had to receive at least 16 proxy forms from eligible voters. Since at least 14 of those 16 proxy forms would be required during “roll call” in order to reach a quorum of 38 to even commence a vote, it is remarkable that the Club failed to identify any members who submitted proxies, let alone who presented and recorded those proxies. The failure to identify those members they allege to have submitted proxies, and the resulting failure to document a presence of a quorum, necessarily means that all votes taken at the meeting are invalid and without any lawful force and effect. Since the Board’s election is not valid, new elections should be scheduled and properly conducted.
The By-Laws do not Allow Email Ballots: Although the Club announced members could email their ballots to the Club, there is no provision for voting by email in the By-Laws. It is unfortunate that the Club officials misled the membership on this point, but emailed ballots are simply not valid. Unlike proxy ballots which name a proxy who must be present to record the proxy, any votes on emailed ballots cannot be recorded, much less used to establish a quorum.
The Club’s Response to Impending Lack of a Quorum: Just before the Annual Meeting began, it seems the Board took a look around and felt they may not attract a quorum because, just eight minutes before the Annual Meeting was scheduled to begin, Gregg Galyo sent an email pleading for members to vote “or we will have to do this again.” Galyo told members that, if they could not attend, they should email “ballots to PBFClub.vote@gmail.com.” Again, there is no provision for voting by mail or email, and even if someone did email a ballot at the last second, it would have been entirely improper to count that ballot toward a quorum because it was not a proxy form and the voter is not present. Other voting irregularities aside, Galyo’s solicitation suggests that – just before the meeting was to begin – he and the others on the Board could see that no quorum was present yet and they were concerned that no quorum might ever become present. Considering the legitimate need to have a quorum present, we find it most odd that Galyo did not cast the widest net possible by including the Zoom link so that members could just click on it to “attend.” While Galyo provided the hangar address and voting email address, the Zoom link would certainly have been the most useful in a last-minute pleading to attend this meeting so as to increase participation to a number that would establish and sustain a quorum. But the Zoom link was surprisingly missing.
Who Did the Club Claim Were Eligible Voters? At the Club Meeting in January 2021, Club Treasurer Andrew Bilukha committed to distribute a list of all eligible members in advance of the meeting. Also, President Gilhooly announced his intent to send notices to all individuals who were deemed ineligible. However, it seems the Club took neither action. Furthermore, at the meeting on January 13, 2021, the Treasurer stated there were 58 “active” members and 20 “suspended” members “for different reasons.” But Galyo’s email after the Annual Meeting, and even the official minutes stated that there were 74 “active” members. There was no mention of any “suspended” members in either document. Galyo also noted in his email that there were “20 plus” members present at the Club hangar and another nine on Zoom. It is striking that the official minutes identified a total of only 24 members present at the hangar or via Zoom. Taken in total, things just aren’t adding up.
Strange Math and Shell Games: Galyo claimed there were “20 plus” members present at the hangar, and another nine were said to be present via Zoom. This means he is claiming there were at least 29 “live” eligible participants at the hangar or via Zoom, a number that falls well short of the 38 needed for a quorum. But this shortfall is widened further by the disclosure in the official minutes that only 24 members were present at the hangar or via Zoom. Because of these counting and reporting discrepancies, and, because there is no record or tally of proxy ballots at all in the official minutes, it is impossible to reliably calculate how many proxy ballots were counted or how many email ballots were counted even though they should not have been counted. So, despite four different methods of voting advertised by the Club (in person, via proxy, Zoom, and email), how realistic is it that not even one other candidate received even one vote by write-in? How realistic is it to claim that every voter each checked all five boxes for the incumbent candidates? All five incumbent candidates got exactly 40 votes each? Not even one ballot was deemed ineligible to vote? Not even one ballot, even if ineligible, cast a vote for somebody other than the five incumbents? Considering some of the discussion at membership meetings and in group email exchanges prior to this vote, this alleged outcome is dubious, at best. If democracy, participation, and legitimacy of the outcome are important tenets of corporate governance, then the conduct and reported numbers in this election are concerning, to say the least:
- No list of eligible voters was ever distributed for the record, in advance of the vote, as had been promised.
- No complete list of voters whose ballots were counted has been provided or distributed showing the method of voting for each ballot. Without such a list, because the Club allowed such voting in person, proxy, email, Zoom, etc., nobody can be assured that all votes were cast by eligible voters. Likewise, without such a list, members cannot confirm if the Club counted their vote or – maybe – that the Club counted their vote when they never even cast a ballot. Such a list would identify any emailed votes. These emails should have been set aside and not counted, but they absolutely need to be identified and quantified, especially because they cannot be used to satisfy a quorum.
- No list of ineligible ballots received was ever provided or distributed.
- No list of any ballots set aside or not counted was ever provided or distributed, nor was there any stated rationale for exclusion.
- The claim that 100% of 40 ballots cast were all for the incumbents begs substantiation.
- The implied claim that there were no write-in votes at all begs substantiation.
- The Club tallied up just two more than the minimum number of ballots needed for a quorum when – just minutes earlier – there was no quorum. This begs documentary substantiation.
- Each of these irregularities requires documentary substantiation to establish exactly whose votes the Club counted and their voting method. Additionally, the Club owes the membership a report on the number of ballots received that were excluded because the Club determined they were ineligible (and why).
The Failed Amendments to the Articles of Incorporation: While the Club has claimed 100% of all 40 votes cast were for the incumbent Board, they also said there were (somehow) only 19 votes cast for the proposed amendments to the Articles of Incorporation. It is not clear if they are saying there were 19 votes in favor, or that there were 19 votes in total and some of those 19 voted against. Still, the Club deemed the voting participation was insufficient to pass the amendments. In his email, Galyo, suggested the low support might be due to the Club’s lack of explanation and suggested there was “confusion” about the need for the changes. Both Galyo’s email and the official minutes said the Board will “discuss a plan [to go] forward.”
Fire, Aim, Ready! After the failure of their amendment plans, the Club’s Secretary now says they are going to “present out [sic] plan shortly for everyone’s review on why we need to change the articles.” Umm… shouldn’t that review and discussion have taken place before the Board even drafted, proposed, and voted on the changes? Of course, there is no indication the Board voted on the actual language of the proposed amendments. Making matters worse, after distributing the ballot and proxy forms, and without any notice or explanation, the Club made substantive changes to one of the proposed amendments and began distributing a revised ballot (“r2”). This is a great example of the kind of bad things that can happen when you act in haste. The problem with introducing “r2” mid-voting is that the Club engaged in a huge “no-no” of parliamentary procedures. They fatally contaminated and voided the vote. It is absolutely impermissible to debate or alter a question (proposed amendment) in the middle of the voting process. If their answer to this glaring problem is that, “the changes were not substantive so it doesn’t matter,” such an answer only causes one to ask, “If it meant the same thing, why make the changes at all?”
Proper Planning and Preparation Prevents Piss Poor Performance: The Club would do well to embrace this old adage of military origin, the “Seven P’s.” This concept is even recognized by the US Air Force (for publication, they changed “Piss” to “Pitiful.”) We would certainly hope that any future plan includes use of critical thinking, a written legal opinion, with case citation, showing how it would be legal (as opposed to being yet another Club “defective corporate act” under Florida law for a corporation who has already issued more shares than authorized (a.k.a. void shares) to hold a vote to increase the number of shares… and counting those void shares as votes of approval.
Amendments Require a Majority Vote of All Eligible Voters: Article X of the Club’s Articles of Incorporation explains that all amendments to the Articles of Incorporation require not only a quorum be present, but that a majority of all eligible members (whether present or not) vote in favor. If one accepts the ridiculous argument that as many as 74 members were eligible to vote on an amendment to increase the number of eligible members to more than the existing 50, that means that at least 38 members would have to be present (or present via proxy) and vote in favor of each amendment in order for them to pass. But the Club has said that 40 members voted – en masse – to re-elect all incumbents. Ordinarily, that would be very suspicious if not for the fact that that, on January 8, 2021, Galyo sent a campaign email on behalf himself and the other incumbents, salting the “election” with an official-looking Club message. Prior to that, the Club had sent no notice of election, solicitation of candidates, etc. In his January 8, 2021 email, Galyo said the entire incumbent Board was running for re-election as a slate, and then he attached an official Club ballot that only listed their names! So the failure of the proposed amendments may not be so surprising after all. It seems possible that at least some of the 35 voters (40 less the five incumbents voting for themselves) didn’t understand the voting process, and yet others may have felt they had no choice other than to vote for the five incumbents after receiving Galyo’s January 8th missive with a ballot attached having only their names on it.
Legitimacy of the Vote Tallies: In his email three days after the Annual Meeting, Galyo suggested that about 29 members were present in person or via Zoom. The official minutes have a different story, listing 24 members as being present at the hangar or on Zoom. But with 100% of the voters allegedly in lock-step with the incumbent officers and their agenda, how is it even possible the Club ended up with only 19 votes cast for the amendments? Or perhaps some members, as many as 21, voted against the amendments? Or perhaps some of the 40 voters made it known they would not vote in favor of the amendments? Whatever the case, there are serious questions as to whether there was ever – at any time during this meeting – a quorum present (in person, Zoom, or by proxy), which further leads to questions as to the legality of this election of the Club’s Board. Specifically, the Club reported that only 19 members voted on the amendments to the Articles of Incorporation, but Galyo’s February 13th email stated that “20 plus” and 9 members were present in the hangar and on Zoom, and then the official minutes reflected only 24 members present in the hangar and on Zoom. Regardless of the inconsistencies, none of these numbers approach the 38 required to establish the presence of a quorum.
Potential Adverse Consequences: Even if many members are too preoccupied with their personal lives or disinterested in Club “politics,” it seems unlikely that the improper structure, function, and governance of the Club will continue indefinitely without some form of external adverse action. At any time, the proverbial shoe could easily drop upon the Club due to issues completely unrelated to voting. Such an occurrence would almost certainly shed light on any number of the many structural and performance issues we have previously described. While some of what we have described is complex and does not lend itself to simple band-aids, we believe someone with a sixth-grade education should have been able to catch most of it, or at least would have known to seek out qualified experts who could then distribute a report to all shareholders with recommendations to resolve these problems.
Does Anyone Even Care? In closing, we also have to keep in mind the increasing percentage of a new class of voters within the Club: Those who didn’t capitalize the Club with $1,700 of their hard-earned money, but instead joined “on the cheap” with a vested interest in the Club of only $1.00. It is reasonable to conclude that some, most, or even all of these new members could care less about the Club’s long-term interests. Why should they care? Why should they even bother showing up to vote? They only have $1.00 on the line. Even the shareholders who paid their $1,700 refundable Membership Fee have now been told they will never receive their refund when they leave, so why should even those people care? We’re not trying to be cynical here. We are just making a genuine observation about human nature and the consequences of some Club business decisions. They seem to have turned it into just another aircraft rental company motivated by profit where customers have no vested interest. This is very far from what the “founding fathers” that included the mandate in the By-Laws that the club must be run as a not-for-profit corporation, an IRS Section 501(c)(7) not-for-profit social club, and had been successful in doing so since 1970 until the new guys came in in 2020.
Vote of Confidence? We also note the Board included the following statement after claiming to have been re-elected with 40 votes: “We thanked everyone for their vote in confidence.” It seems rather arrogant to be assigning motives to voters like that (especially since they seem to have no clue why their proposed amendments failed). They were the only people on the ballot and their only claim is to have been re-elected by a razor thin quorum with real questions about circumstances and legitimacy of the election itself, and they want to claim it was a vote of confidence? For comparison, immediately below is the previous Board election result from the Annual Meeting in February 2020. In the 2020 election there were more than five candidates on the ballot beyond the individuals listed below who received the most votes. To put this in context, keep in mind that, even if the “40 for one/40 for all” results are real, it means only 54.1% of the eligible members voted for the incumbents in February 2021. Additionally, the member list last year had 14 fewer members than this year, due at least in part to a larger than normal number of members who left the Club, some citing the hostile environment leading up to that election, as reported in an open letter we distributed on December 18, 2020.
| 2020 Candidate |
2020 Votes |
2020 Percent of Eligible Voters |
| Yanikian | 37 | 64.9% |
| Gilhooly | 35 | 61.4% |
| Breeden | 33 | 57.9% |
| Holm | 31 | 54.4% |
| Bilukha | 30 | 52.6% |
If you were not here last year, you might not know that February 2020 was a very contentious election. Still, Gilhooly ended with 61.4% of the vote in February 2020. This year he got only 54.1% of the vote with nobody running against him – no competition on the ballot at all. That’s a vote of confidence? We think the vote outcome, especially when combined with the severely low participation in the amendment vote, is a far larger indication that no one cares. We also think it would be healthier for the Club if its officers shared this sentiment and took steps to recover the value of the Club to its members, not default on that value.
Who Is The Club Today? With no one left in the Club who has a vested interest in the long-term success of the Club, why would anyone bother voting at all? Why would anyone bother washing airplanes or helping out? It’s just a rental place, right? This is where this leadership has taken the Club, so this is certainly a fair question to ask. Again, not trying to be cynical. Sadly, if nobody has a vested interest and no one cares enough to stand up, even this basic question will probably never be asked, much less answered. But it might still be a good idea for the leadership to give it some serious thought and take affirmative steps to correct problems rather than attack others and deny the problems exist.
From: Gregory Galyo <NoReply@timesync.com>
Sent: Sat, Feb 13, 2021 10:48 pm
Subject: 2021 Election of Board Members
Dear Pompano Beach Flying Club Members,
We held our annual corporation meeting at our hanger and via zoom at 6pm on 10 February. We had 20 plus members show at the hanger and another 9 online.
Thank you to all members who submitted their votes in person or online.
We currently have 74 active members and a quorum of 37 was required to vote to elect new board members. No one submitted their names to run for election and we received 40 votes to reelect the current board.
We like to thank Ara Yanikian, Ronald Ziller and Timothy Morick who were impartial members who took the time to count the votes.
The board received 40 votes for each member:
Gregory Gilhooly
Tor Holm
Andrew Bilukha
Gregory Galyo
Gregory Worley
As we said before, the board ran as a unified slate; it has been an honor and a privilege to serve the club this past year, and we will continue that service for another term, making improvements to our club.
We will continue to put maintenance and safety on the forefront, and we are planning to continue to make strides towards improving interior of the planes.
Unfortunately, we only received 19 votes to amend the articles. We are discussing a plan forward and will advise shortly. Maybe we clearly didn’t express the changes we were trying to make. Additionally, there could be confusing that the proxy for the ballot would allow us to count the vote for the article change, it did not.
We will present out plan shortly for everyone’s review on why we need to change the articles.
Sincerely,
Gregg Galyo
PBFC, Secretary