- 7 -
videodisc technology for shareholders in the to-be-formed S
corporations.
Once Gould and Systems agreed to form the two S
corporations, Gould began to locate potential shareholders in
what would become IRC and RIC. Gould tried to locate
shareholders who would qualify under the private placement rules
of the Securities Act of 1933. To ensure qualification,
prospective shareholders completed "investor qualification forms"
which solicited the information necessary to determine whether
potential shareholders satisfied the Securities and Exchange
Commission’s rules regarding private placement offerings. The
investor qualification forms provided information about the
potential shareholder’s balance sheets, income statements, tax
returns, and experience with investing in private placements.
Potential shareholders in IRC and RIC had to have a minimum net
worth of $200,000. Gould reviewed the investor qualification
form of each potential shareholder. Shareholders in the S
corporations were not selected on the basis of education and
experience in manufacturing or in marketing.
A majority of the shareholders of IRC and RIC were
professionals and had some managerial and business expertise.
Frank Colenda (supra note 1) participated in the U.S. Navy’s
development of the “Sparrow” missile program. Among the
shareholders of RIC were the following: Joan C. Benz, a Ph.D.,
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011