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At the time of incorporation, petitioner's total authorized
stock was worth $1,200, divided into 12 shares of common stock
with a par value of $100 per share. Originally, six shareholders
owned stock in petitioner, including James F. Hooper (Hooper) and
Paul R. Chamblee (Chamblee). Each of the six original share-
holders owned two shares of common stock. Under petitioner's
bylaws, a shareholder could transfer his interest to an outsider
only after having offered such shares to petitioner at market
value. In 1974, one shareholder sold his stock to the remaining
five shareholders. One year later, another shareholder sold his
stock to the remaining four. Finally, in 1982, two more
shareholders sold their stock to Hooper and Chamblee, leaving
each a 50-percent owner of petitioner.
Pursuant to its bylaws, petitioner's business and property
would be managed by a board of directors, elected by the
shareholders. The board, in turn, would delegate managerial
duties to corporate officers by electing a president, vice
president, and secretary-treasurer. The officers' main function
would be to oversee the corporation's daily affairs, including
authorizing written contracts of the corporation, signing all
stock certificates, keeping minutes of all proceedings, and
safeguarding the corporation's moneys. Both Hooper and Chamblee
have served on petitioner's board of directors since 1971.
During 1993, Hooper also acted as president and, together with
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Last modified: May 25, 2011