- 5 - In July of 1988, apparently before petitioner made any claim that the debt purportedly owed to him by EPL was worthless, EPL's financial statements for 1986 were prepared and reflected total assets of $3,029,877 and total stockholder equity of $552,097. Included among the reported assets was an asset with a stated value of $2,369,810 that was described as "Fair Market Value of Product Rights". In September of 1990, apparently after petitioner made the claim that purported debt owed to him by EPL was worthless, EPL’s financial statements for 1987 and 1988 were prepared, and the above asset was omitted from the financial statements. EPL experienced some degree of success. Between 1983 and 1987, EPL’s gross receipts increased by over 400 percent. According to EPL’s books, however, from 1984 through 1987, no net profits were realized by EPL, and EPL had a negative net worth. In 1988, EPL became delinquent in the payment of employment taxes, and EPL’s board of directors considered filing a bankruptcy petition. Petitioner and his son, however, decided not to file a bankruptcy petition on behalf of EPL because such a step would disrupt EPL’s employee, vendor, banking, and customer relationships and would damage EPL’s trade name. Further, in 1988, petitioner and his son still considered EPL's businessPage: Previous 1 2 3 4 5 6 7 8 9 Next
Last modified: May 25, 2011