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For fiscal years ended July 31, 1984 through 1988, Messrs.
Mitchell and DeJoria each received the following payments from
JPMS:
For Year Ended Salary Management Fees Total
7/31/84 --- --- 1$1,086,500
7/31/85 --- --- 12,305,000
7/31/86 --- --- 14,162,525
7/31/87 $185,125 $8,565,000 8,750,125
7/31/88 1,308,000 10,500,000 11,808,000
1 Payments to Messrs. Mitchell and DeJoria for this year
were not broken down into salary or management fees.
JPMS characterized these payments as compensation for services
rendered.
Between August 1, 1988, and April 21, 1989, JPMS paid Mr.
Mitchell $10,758,046 (which JPMS characterized as compensation for
services rendered). For fiscal year 1989, Messrs. Mitchell and
DeJoria agreed that each of them would receive a $2 million annual
salary and a $15 million management fee. The JPMS Board approved
these compensation amounts on October 21, 1988.
From the inception of JPMS until the moment of Mr. Mitchell's
death, the only dividend declared by JPMS was for its fiscal year
ended July 31, 1988. The dividend was originally set at $1.4
million but was subsequently raised to $2.5 million.
During the latter part of Mr. Mitchell's illness, Messrs.
DeJoria and Mitchell discussed Mr. DeJoria's future compensation.
Mr. DeJoria promised Mr. Mitchell that in the event of Mr.
Mitchell's death, he would reduce his management fee from $15
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