Two board members quit YTB; ‘Coach’ Tomer earns $2.9M in ‘08

Two more board members are resigning from online travel firm YTB International, according to the Wood River-based company’s proxy statement (available here).

Clay Winfield, a Madison County developer, resigned effective last Thursday. And Dr. Timothy Kaiser, an Alton physician, will not be seeking re-election at the company’s annual meeting next month.

Winfield and Kaiser were principal shareholders of Meridian Bank, which was taken over by the FDIC in October for unsound practices. Meridian, which was based in central Illinois and had a branch in Alton, lent money to YTB in recent years, including a $2.5 million loan at favorable interest rates to help buy land for the company’s new headquarters in Wood River. The two also owned a company that rented and later sold office buildings in Edwardsville to YTB, and a second company that sold a private jet to YTB. Winfield is also co-owner of the construction company that’s building YTB’s new headquarters, which has received at least $6.4 million for the job.

Two other board members have quit since YTB’s legal troubles began last summer, and the departure of Winfield and Kaiser will leave the company’s board with just seven members after the annual meeting: YTB founder Lloyd “Coach” Tomer; his son and chief executive J. Scott Tomer; co-founder J. Kim Sorensen; Cardinals Hall of Famer Lou Brock, who is an upper-level sales director at YTB; Howard Kestenbaum, a New York-based franchising attorney; Andrew Wilder, a New York-based accountant; and Paul Hemings, a sales director at Energizer Holdings. Hemings and Scott Tomer are up for re-election.

The company’s top executives did take a pay cut in 2008, a year that saw YTB’s ranks of travel agents shrink, its budget swing to a loss and its legal troubles mount.

Between salary and sales bonuses, Lloyd Tomer earned $2.98 million in 2008, according to the SEC filing, down from $3.3 million the year before. He deferred some of the sales bonus, $419,803 of which remains unpaid. And in March, the company’s board voted to suspend Tomer’s most lucrative bonus arrangement because of the economy and YTB’s financial condition.

Scott Tomer earned $1.02 million, down from $1.99 million in 2007. Most of the reduction was because YTB didn’t issue stock awards to its top execs in 2008. Kim Sorensen earned $1.03 million, down from $1.99 million in 2007.

YTB also said it will move most of its printing business away from BerylMartin, a northern Indiana printing company owned by the Tomers and Sorensen. Last year, it spent $3.4 million for BerylMartin’s services, which included building a nearly-life-sized Statue of Liberty at YTB’s annual convention.

In March, YTB’s independent auditor issued an opinion criticizing the company’s internal financial controls, saying the board had too little control over management spending and executives had signed contracts without proper board approval. Last month, YTB named longtime Madison County businessman Robert Van Patten as co-chief executive.

The company is also still facing a deceptive marketing lawsuit from the California Attorney General’s office, despite last month telling its sales force that a settlement was near.