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plus an amount equal to any accumulated but unpaid dividends.
The option price for the common shares was $100 a share. The
1960 redemption agreement provided for yearly revaluations of the
option price for common shares.
Joseph A. Simone
Joseph A. Simone (Simone) went to work for the company in
1975. He had just graduated from college, and his first job with
the company was that of office boy. Simone continued his
education after starting work with the company, earning an MBA
from Fordham University in 1979. Also by 1979, Simone was
involved in every facet of the company’s operations.
Subsequently, he became an officer of the company. Simone was
elected to the board of directors of the company in 1984 or 1985.
Simone and decedent developed a close personal relationship.
Decedent loaned Simone money ($80,000 in 1981 and $95,000 in a
later year). Decedent named Simone a beneficiary in wills
executed by decedent between 1985 and 1987.
The 1987 Redemption Agreements
In 1987, decedent entered into an agreement restricting his
rights (and the rights of the executors of his estate) to dispose
of his shares of stock in the company (the 1987 redemption
agreement). At that time, the stock of the company was held by
decedent, Poesch, and Simone as follows:1
1 The company issued the 6-percent preferred shares sometime
(continued...)
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