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On October 15, 1995, Burien Nissan canceled the 35,280
shares of Mr. Whitehead’s stock that Mr. Whitehead had purchased
from Mr. Stanford on September 13, 1991. Thereafter, Mr. White-
head owned 11,760 shares of Burien Nissan stock.
On March 10, 1996, Burien Nissan and Mr. Whitehead entered
into an agreement entitled “ASSIGNMENT AND ASSUMPTION OF AGREE-
MENT AND PROMISSORY NOTE” (assignment and assumption agreement).
Mr. Whitehead signed the assignment and assumption agreement as
president of Burien Nissan on its behalf as the assignee and in
his individual capacity as the assignor. Mr. Stanford consented
to and signed the assignment and assumption agreement. The
assignment and assumption agreement acknowledged (1) the purchase
on September 13, 1991, by Mr. Whitehead of all of Mr. Stanford’s
Burien Nissan stock pursuant to the September 13, 1991 White-
head/Stanford stock purchase agreement and (2) Mr. Whitehead as
the sole stockholder of Burien Nissan.8
The assignment and assumption agreement provided, inter
alia, the following:
8It is not clear from the record when Mr. Watson ceased to
own his 5,880 shares of Burien Nissan stock and Mr. Whitehead
became the sole stockholder of Burien Nissan. Form 1120, U.S.
Corporation Income Tax Return (Form 1120), that Burien Nissan
filed for each of its tax years 1994 through 1997 showed Mr.
Whitehead as the sole stockholder of Burien Nissan. Mr. White-
head signed as president of Burien Nissan and under penalties of
perjury at least Form 1120 that Burien Nissan filed for each of
its tax years 1994 through 1996. It appears that Mr. Whitehead
was the sole stockholder of Burien Nissan at least as of the end
of 1994 and at all relevant times thereafter.
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