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pursuant to a final court order. In addition, Ms. Boyle also
granted petitioner an irrevocable proxy to vote all Oralco shares
awarded to her so long as the Option Agreement was in force.
As consideration for the Option Agreement, petitioner was to
pay Ms. Boyle $25,000 upon its execution, plus $5,000 per month
for the months of January, February, and March 1993, and $10,000
per month thereafter until the later of December 31, 1996, or
until the option was exercised or terminated. In addition, if
Ms. Boyle was not awarded sufficient Oralco shares, when combined
with petitioner’s shares, to control Oralco, petitioner could
terminate the Option Agreement. If the Option Agreement remained
in force through December 31, 1996, Ms. Boyle held a put option
to petitioner, which she could exercise during the first 30 days
of January 1997, if petitioner failed to purchase her shares on
or before that date.
During Ms. Boyle’s appeal of their divorce order, Mr. Boyle
became concerned that a modification of the divorce order could
result in a distribution of more Oralco shares to Ms. Boyle. Mr.
Boyle might then lose control of Oralco, triggering the “loss of
control provision” in a credit agreement between Ormet and a
banking syndicate.18 To avoid that eventuality and unknown to
petitioner, as of January 19, 1993, Mr. Boyle and Ms. Boyle
18 Mr. Boyle also argued that the loss of control provision
would trigger acquisition-financing debt and materially impair
the value of the Oralco stock for both Mr. Boyle and Ms. Boyle.
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