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For Year Ended Amount
7/31/90 $12,000,000
7/31/91 17,025,000
7/31/92 17,025,568
7/31/93 17,000,000
7/31/94 17,000,000
JPMS characterized these payments as compensation for services
rendered.
From August 1, 1989 through 1992, Mr. Fujieki repeatedly
requested in letters and at Board meetings that the Board retain an
independent compensation consultant to consider the reasonableness
of Mr. DeJoria's compensation. The Board rejected Mr. Fujieki's
requests. At this time, tension began to mount among members of
the Board.
In late 1990, Mr. Fujieki retained Coopers & Lybrand to
determine a reasonable level of compensation for Mr. DeJoria. On
January 11, 1991, Coopers & Lybrand preliminarily determined that
a reasonable level of compensation was within the range of $600,000
to $1 million, with a possible $2 million ceiling. At the January
10, 1992, Board meeting, the Board approved Mr. DeJoria's
compensation at 13 percent of JPMS' gross sales, not to exceed $17
million per year, for JPMS' fiscal years ended July 31, 1992
through 1996. Mr. Fujieki objected to this approval by the Board.
Mr. Fujieki proposed to have the compensation dispute resolved
by arbitration, but Mr. DeJoria refused. Accordingly, in June
1993, Mr. Fujieki brought suit against Mr. DeJoria, Ms. Re, and
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