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On December 13, 1983, Tomanet issued stock certificates to
petitioner for 14,535 shares and 20,365 shares. Petitioner
pledged 20,365 shares to Lemons as security for his note.
On August 2, 1984, Tomanet changed its name to Texana
Capital Corp. (Texana Capital). Petitioner was not involved in
any of Texana's activities and did not receive Texana's financial
statements.
D. Petitioner's Transfer to Vernon's California Subsidiary and
Dixon's Offer To Sell Dondi Financial Stock to Dondi Group,
Inc., Employees
Petitioner left Dallas in August 1984 to become president of
Vernon Asset Management Corp., a Vernon subsidiary in southern
California. While in California, petitioner did not control
Vernon's day-to-day operations or know about every loan Vernon
made.
On August 16, 1984, Vernon entered into a supervisory
agreement (not otherwise described in the record) with the
Federal Savings and Loan Insurance Corporation (FSLIC).
Dixon offered to sell Dondi Financial stock to Dondi Group,
Inc. employees in December 1984. Dixon required any employee who
wanted to buy the stock to pay 15 percent down and execute a
purchase money mortgage for 85 percent. The purchase money
mortgage was a 5-year note. Employees were to pay only interest
during the 5 years and make a balloon payment of the principal
after 5 years. Dixon held at least 51 percent of Dondi Financial
stock at all relevant times.
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