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Co.'s certificate of incorporation required indemnification of
officers for expenses arising from acts performed in good faith
and in a manner reasonably believed to be in the best interest of
Orange Co. All of the SEC litigation expenses Mr. Davis deducted
in 1987 and 1988, see infra, were included in the demand for
indemnification in the Orange Co. litigation.
In 1992, the Orange Co. litigation was resolved. Stoneridge
agreed to pay Mr. Davis $47,500.
In a letter dated May 18, 1995, Orange Co.'s directors' and
officers' insurance company informed the IRS that it reimbursed
Squire, Sanders & Dempsey for its representation of Mr. Davis and
reimbursed Laura Byrne for her work as counsel for various
officers and directors.
Legal Fees Charts
In 1987, Mr. Davis paid, incurred, and deducted on his
Schedule C for 1987 the following legal fees:4
Matter Amount
Squirrel Bend litigation $179,726
SEC litigation 51,285
Orange Co. litigation 36,163
Tax matters 3,493
General business matters 3,115
Total 273,782
4 For convenience, all figures are rounded to the nearest
dollar.
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