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It was also agreed to issue 10 shares of common stock at
a par value of $.001 per share to Bob Butler effective
September 1, 1993. This would result in a three way
ownership of the three stockholders each owning a third
of the business. Also Bob Butler would loan over time,
$25,000 interest free to the business. For the
remainder of 1993 Bob would share any Profit/Loss on a
pro rata basis (One Third).
No stock certificate was issued to Bob. Bob “loaned”
Southern Auto $10,000, but did not “loan” the remaining $15,000
to Southern Auto.
Frank believed that initially Bob was able to handle the
responsibilities that he had at Southern Auto. However, within a
year Bob’s performance became unsatisfactory. Among other
things, Bob often failed to lock up the building, did sloppy
paperwork, and neglected to comply with sales requirements and
keep records. Bob’s performance never improved.
On January 9 and 10, 1995, Frank and Thomas, and Bob,
respectively, signed a Termination of Stock Purchase and/or Stock
Option Agreement between Southern Auto and Bob. None of Southern
Auto's employees signed such an agreement. The agreement states
in relevant part:
WHEREAS, on or about August 24, 1993, the Corporation
and Butler entered into an agreement in the nature of a
stock purchase and/or stock option agreement ("Stock
Purchase Agreement") by which Butler was to receive ten
shares of common stock (one-third of the total thirty shares
of common stock) of Corporation and, in consideration
thereof, was to make an interest-free loan to the
Corporation, over time, in the amount of Twenty-Five
Thousand Dollars ($25,000.00); and * * *
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