Complaint Review: SeedAmerica Foundation

It’s funny that this issue came up in a conversation a week or so ago and it’s been over 10 years since the downfall of SeedAmerica.

I knew the insides of the company and leadership, and I always wanted to comment on this post but I never did and was too timid to provide my perspective. But now that time has passed and I assume everyone has moved on with their lives, I wanted to correct a few things in this original post.

A lot of things have already been corrected by others and I don’t need to belabor some of those points again. But here are the points that I would like to make:

1. There was no Joe in the company ever other than Joseph Johnson and he would obviously not have written this post. Therefore, that’s the first lie with the author of the post and automatically loses credibility. There are many other lies or misrepresentations of facts.  

2. The author of this post, who I know but will not name him publicly at this time, attempted to extort the leadership and the company for money. He basically came to them and said if you don’t pay me “X”, and I remember it being well over $10,000, I am going to do everything I can to tarnish your reputation, including going to the media and the internet. The leadership told him that they would not be extorted and he needed to do whatever he was going to do.

I don’t think they realized that he was going to twist the facts or flat out lie about things. So, this post was originated by a criminal act of extortion under false identification. That should tell every reader everything they need to know.

3. Looking back, almost every company involved in real estate got hammered in 2008 and SeedAmerica was no different. So, context is everything. Plain and simple, the company was a casualty of the great recession.

4. The people leading the organization were very good people. They would all give the shirt off their backs for you and someone in need. I personally experienced this while working for them. So, when the author says some used Christianity to their financial advantage, that’s flat out wrong. They were and I presume still are very outspoken Christians. So, that’s who they were and they weren’t going to hide it, which is different than how the author is presenting it.

5. In terms of Joseph being an ex-convict for kitting checks, that’s also completely missed place. Yes, part of his testimony that he openly shared with us and others is that when he was 21 years old, he went bankrupt with his first business and in the process bounced a few checks running at 21 years of age. But it was because someone else that was supposed to pay his company bounced the same amount and put him and his business in a bad situation. Nonetheless, he paid that off in a couple of months.

I am not making light of bouncing checks but we have all probably bounced a check in our life time, and most of us did a lot worst things when we were 21 years old. But at least he was trying to be responsible while he was trying to build a business and going to college on nights and weekends. So, that statement is a complete mischaracterization of the facts.

6.  The people who didn’t get paid, which was only for 1 month outside of the leadership, volunteered to the risks and to stay on. Not everyone did. Some people left right away and were paid in full. Others were hoping that some financing would come through like the rest of us.

But those who chose to stay, we agreed to a 2nd lien on a property that we believed had equity as collateral. As the market continued to get worse, that equity evaporated. But we all knew the risk and no one put a gun to our heads. It was our choice to stay or not. At the time, it made sense to take that risk. Most of us loved working there. In hindsight, we should have just moved on earlier. But that’s hindsight. However, the leadership lost more than anyone else by far. They sacrificed a lot more even though it was a nonprofit and no one really owned the company.

In summary, I hope everyone has moved on and is doing well. The great recession was a difficult time for the entire country and we were no exception. But I believe everyone learned valuable lessons and makes them better people today.

There, I said my peace and I can move on without feeling guilty because I never spoke up.

The overpriced properties are just the surface of this all-around deception that Welfont Group calls a business. A simple check with the proper authorities revealed to me that all of the company's brokers aren't even licensed. The ones I dealt with in Tucson, Arizona are definitely not licensed brokers. Deal with them at your own risk.

I don’t know what’s worse about this company.  The fact that their "brokers" are unprofessionals or that the property they sell are mostly overppriced. Never doing business with them again.

I won’t repeat what my former colleagues have already and eloquently stated.  Other than to confirm that I agree with everything they have presented in rebuttal to “Joe’s” posting. 

Let me also add, that I could not have described the integrity of Chris Zimmerman any better than Jerry and Patrick.  Thanks guys…you nailed it! 

The benefits of doing business with Retake Your City are well worth exploring.  Make contact and let them explain the program.  It would be a shame to refrain from exploring an opportunity because of one, anonymous commentator.

Iwas recently reminded of this posting a few days ago when Chris Z contacted me for my opinion.As a former employee, I was aware of the original post and had chosen not to reply to it at the time.It was clear that the author was venting.However, due to the rising popularity of sites like this, I think its important to ensure that the record be set straight regarding the comments made by the original author.After all, if a forum like this is to exist and provide value to those who look to it to help shape their opinions and thoughts about individuals or organizations, truth ought to be spoken there.

Jerry C did a good job of laying out the facts, so I wont re-state them.What I will do is point out that SeedAm wasnt the only organization to be surprised by rapidly changing financial markets.Hundreds and thousands of organizations fell victim.It came quickly and were still feeling its pain.Certainly this recession has had a lasting impact on many of us.How many of us cant count several people (including ourselves) who were affected by a re-orienting economy?We all know lawyers, architects, retailers, machinists, etc. who were impacted and either shut down their practices or were laid off.Many have found new ways to provide for their families.Some have re-invented themselves.Some, unfortunately,are stillstruggling.

Care should be taken not to assign too much responsibility to the former SeedAm executives.After all, they didnt cause the economic collapse that occurred in 2008.Despite its issues, we still live in a great country.And because of our freedoms, we are able to make choices.We can decide whether or not to vote, what to have for dinner, and we can decide whether or not to work.Joe, the author, made a conscious decision to continue to work for SeedAm.Although understandably disappointed, Joe could have chosen to do something else with his time and experience but he chose not to.

Ill restate something that Jerry C mentioned in his rebuttal:that is that SeedAm was made up of dedicated, bright, and creative individuals.We were united by a good mission, sound business practices, and hard work.When the credit crunch showed up with a one-two punch, we were naturally upset and disappointed (and if were honest with ourselves a little scared).Our long-term expectations had been taken away.I wish all my former SeedAm associates well.My guess is that everyone is on to another chapter in their lives and hopefully see their experience at SeedAm for what it was a time of learning and preparation.

Regards,

Steve Alves

First, I want to say that the person who wrote this report did not have enough integrity to use his/her real name. There was no "Joe" from Atlanta that worked for SeedAmerica. The person did not use their real name because they were lying about the facts and using "facts" to twist the real story.

Here's the bottom line of SeedAmerica. They received Surplus Corporate Industrial Properties as Contributions from companies all across the United States. There were typically large properties in remote areas, functionally obsolete properties, or properties that the company was unable to sell for one reason or another. SeedAmerica would take these properties over, make the investment necessary to re-purpose the properties, find tenants and lease the properties at below market rate to area businesses. This was done successfully with many properties including those in Orleans, IN; North Vernon, IN and Danville, IL. The report stated that "SeedAmerica borrowed nearly $12 million on properties that produced little to no rental income". That is a false statement.

SeedAmerica did indeed have about $60 million in real estate assets. And, much of it was not leased. But, that's because of the nature of the buildings that would be contributed. Companies were shutting down manufacturing operations, laying off people and leaving their vacant buildings sitting. They would try to sell the properties, but nobody was buying these no-productive assets. So, SeedAmerica would take on these difficult assets. Turning these non-productive assets into productive assets takes years in most cases. In SeedAmerica's short time, they actually did a pretty good job of turning some of these properties around.

The flaw in the model was this. SeedAmerica management (of which I was one) did not anticipate the magnitude of the economic collapse that was coming. The model relied on 1) getting properties; 2) obtaining a 25% LTV loan on the property from a Hard Money Lender which would provide initial capital to make property improvements and fund the ongoing acquisition effort; 3) find tenants for the property until it was stabilized at about 70% leased; and 4) refinance the property with a traditional lender based on cash flow. SeedAmerica's two primary lenders were Wells Fargo, through Pinecrest National Funding (Hard Money) and BB&T (Traditional Lender). All of BB&T's loans were on cashflowing assets, unlike what the author of the report tried to represent.

Had SeedAmerica anticipated the coming credit crunch and economic collapse that hit in 2008, we would have cut staff long before we did. In the Spring of 2008, we had numerous lenders who were "interested" in lending against our properties. But, as the economy collapsed, these lenders were having trouble accessing capital themselves. So, SeedAmerica was strung along by no less than 5 lenders during the Spring and Summer of 2008. We had loan closings scheduled on an almost weekly basis and the closing dates would always get extended at the last minute. We paid a great deal of money out to these lenders as "good faith deposits", "expense fees", "Loan Commitment Fees" etc. only to end up getting stiffed in the end ... they had no money to lend.

In hind site, what should have happened is that we should have cut staff from 60 employees to about 5 to 7 employees back in April of 2008. This would have stopped much of the bleeding and would have allowed SeedAmerica to live off of it's existing cashflow from leases, perhaps weathering and even prospering in the economic crisis.

But, the reality is that we did not cut staff quick enough. We were honest with the employees about our financial situation and gave them the choice of staying or leaving. So, we were honest about our finances and let the employees decide what they wanted to do. in the end, it appeared that we lied to them about our future finances because we were telling them what our lenders were telling us, that they were going to close the loans, and that turned out to not be true.

As you can imagine, it was a very emotional, uncertain time. I actually was surprised at how few people chose to leave. We were wanting people to leave because the finances were tight and our staffing was too heavy. The heaviest area was in the Acquisitions group. A decision was made about a year earlier to really staff up heavy on Acquisitions personal to secure as many properties as we could. In an up business cycle, that would have been the right thing to do. But, had we seen the economic collapse coming, we would have done exactly the opposite.

When it's all said and done, it was a very emotional time for the employees. They were going without pay, had no certainty of the future and ultimately everyone in the company ended up being laid off (including management). There was a lot of bad blood out there. I don't think any of us realized the magnitude of the economic collapse at the time. it just felt like us. But, now as we look back, there is a long list of companies that have succumbed to recession. Pinecrest ended up filing bankruptcy and as we all know, many banks and real estate companies have failed.

I have to say that most of the employees at SeedAmerica are some of the finest individuals I have ever had the privilege of working with. But, as with any company, there were a few individuals who were vindictive and bitter. Unfortunately, in this day and age, the Internet gives those people a forum. They don't need facts and they are not held accountable. But, hopefully, they have moved on with time.

As for management's "financial gain", I can personally attest to the fact that most of the management were not taking salaries at the end when all the other employees were being paid. I temporarily relocated to Atlanta for 7 months on my own nickle. I funded my living expenses out of my own pocket. And, I was away from my wife and kids for most of that time. I did this because I, like most others, believed in SeedAmerica's cause. It was not about financial gain. Some of us gave substantial amounts of money to needy employees at the end out of our own pockets to help them out. It is important to understand that none of the management had an ownership interest in SeedAmerica. It was a non-profit and as such, had no owners. Nor did the management set our own salaries. Those were set by the Board of Directors.

It is true that I did encourage the employees to "have faith". But, what gets distorted is "have faith in what"? I never encouraged the employees to have faith in me, Joe Johnson, SeedAmerica or anyone else. I encouraged them to have faith only in God. That was good advice then and it's good advice now.

As for Chris Zimmerman, he is a very honest and ethical man. I would trust him with anything of mine ... including my wallet and my wife! I put his integrity up against anyone's, including the author of this Ripoff Report. In fact, if the author wants to reveal himself, we can put the integrity issue to the test.

For over 2.5 years I have held my tongue on this issue because I know it was a very emotional, confusing and painful time for the employees. Most landed on their feet. Some remain bitter. After 2.5 years, it's time that the real story is told. As most know by now, SeedAmerica eventually ended up filing for Bankruptcy and it's assets are being liquidated to settle with creditors. I know this because I, along with many of you, am a creditor. And, FYI - I'm not getting any money. Most of it is going to the Pinecrest Trustee.

And, it's important to know that the IRS has never disallowed any of the Contributions that Donors made to SeedAmerica. And, to my knowledge, the IRS has never even challenged any Contribution that a Donor has made to SeedAmerica.

Jerry Corbier

Having read the rip-off report from Joe, I must take issue with several of his claims.

First of all, Seed America did performon allits intended mission statements during our initial start-up phase and well into the spring of 2008. I know because I was one of the Regional Acquistions Managers involved in securing the donated properties. Chris and his staff of leasing agents actively solicited companies and other business entities to lease space from Seed America and were successful in doing so. Although being successful in this area was a great challenge, Chris, Alex and their staff conducted themselves with the utmost professionalism and attention to the securing the best tenants at the best possible rental rates...it was always intended to be a win-win situation for all parties involved.

Secondly, since I was oneof the initial hires as a RAM, I understood, as did my other collegue,that CASC was the management company that would be administeringour payroll and other benefits. Having been a former business owner,I understood that many companies use an outside agency through which they conduct and operate their business; however, as Seed America continued to grow, there was a growing concern that having CASC as the operating partner for SA could be seen as a way to move money from a non-profit to other entities and might be construed as inappropriate; thus CASC was donated to SA and that relationship dissolved.

Thirdly, as to the so-called claim of"conversion" of Chris Zimmerman, I do not know anyone that is able to see into the heart of any man and thus know his motives or his beliefs...but this I do know...the proof is in the actions of the man!!!! Chris was changed by his faith in a God who sent His son, Jesus Christ and that change became self-evident in his conduct, demeanor and his actions...and that, if for no other reason, gives me the confidence to recommend that if given the opportunity to work with Chris and RYC, you do so wholeheartedly.

Additional information and facts regarding Chris Zimmerman:

1. My name is not Christopher, but only Chris. Anyone who knows me would know that. I share this to show that the party would penned this report do not know me on any personal level.

2. Yes, CASC received money from SeedAmerica. However, that money was used to cover the expenses of acquiring and managing the properties, which included payroll. At that time, all but a few employees where under CASC and all expenses associated with each employee was the responsibility of CASC to pay. CASC was originally hired as a management company charged with the responsibility of acquiring and managing all the real estate for SeedAmerica. All employees, administration and overhead associated with acquiring and managing the real estate also fell under CASC. In return, CASC was to be paid a commission on each property and rental income brought into SeedAmerica. The original thought behind this arrangement was to minimize the costs for SeedAmerica and allow SeedAmerica to focus on its mission will keeping overhead low. In mid 2007, while not illegal, it was realized that this arrangement could be viewed, by the IRS, as a way to funnel profits out of SeedAmerica and into a for profit company. Realizing this, the decision was made to dissolve CASC and put all expenses and employees under SeedAmerica. However, our attorneys recommended we wait until January 1, 2008 to do this as it would be easier from an accounting standpoint. So, in January 2008, CASC was donated to SeedAmerica and all employees and expenses were now paid out of SeedAmerica. All money CASC received was to cover expenses and no profit was realized by CASC.

3. RYC is in no way affiliated with SeedAmerica. It is accurate that we look to get properties donated, which is allowed by any 501c3. The program of donating properties to a non profit is a great program for all involved. SeedAmerica's end result is in no way a reflection on the program itself nor does it diminish the benefits the program offers.

4. I don't claim to be born again, I was born again in September 2006. And yes, Jesus used Joe and SeedAmerica. I don't care who or what Jesus used, I only care that I heard His call for me. That moment was and is the greatest day of my life and I do not deny it.

Additional information regarding Jerry Corbier:

1. Jerry never encouraged the employees to continue working. In fact, Jerry went to great lengths to encourage the employees to seek God and then do what God was telling them to do. Everyone's choice to stay was just that, their choice. He never once encouraged the staff of SeedAmerica to not leave.

2. Jerry stated to the employees that he was trusting God for the payroll because God is our provider, not SeedAmerica. He was stating what his belief was.

3. Jerry did not encourage the employees to fast for 3 days in an attempt to encourage God to bless the company. Jerry informed the company that he personally was fasting and if anyone wished to join him, he welcomed the support.

I would ask any who is looking to do business with RYC to call and talk to us to make your own decision. This report's author has remained anonymous for reasons they feel are important (as it was signed by 'Joe' and there was no Joe who worked for SeedAmerica other than Joe Johnson, the CEO and he did not pen this report). By remaining anonymous and posting partial facts or complete lies, the credibility of this reports needs to come into question. I simply challenge you to contact us for the truth so you can make an accurate decision.

Chris Zimmeman