Joseph R. Rollins - Page 7

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          shown supra in table 1, petitioner had an 8.93-percent interest             
          in J & J Charlotte3, and his then-wife had a 6.70-percent                   
          interest.  There were 28 other shareholders on June 30, 1996; the           
          next greatest percentage interest was 6.25 percent.                         
               Petitioner signed the Plan’s July 8 and September 9, 1996,             
          checks to J & J Charlotte.  (The record does not indicate who               
          signed the checks that effectuated the first three loans shown in           
          table 1.)  Petitioner signed all five of J & J Charlotte’s                  
          promissory notes to the Plan, on behalf of J & J Charlotte.  Each           
          of these promissory notes was a 12-percent-per-year demand note;            
          each stated that it was secured by all the machinery and                    
          equipment at J & J Charlotte.                                               
          On January 11, 2000, petitioner paid $150,500 to the Plan as                
          a repayment on the J & J Charlotte loans.                                   
               All of the principal of the Plan’s loans to J & J Charlotte            
          has been repaid.  See supra note 2.                                         
               c.  Eagle Bluff                                                        
               Eagle Bluff was a golf club located in Chattanooga,                    
          Tennessee.  From 1994 until Eagle Bluff was sold in 2000,                   
          petitioner was Eagle Bluff’s treasurer and its registered agent             
          in Georgia.  On May 20, 1997, the Plan lent $50,000 to Eagle                


               3 So stipulated.  However, the stipulated stock register               
          shows that, on Aug. 28, 1996, before the date of the last loan              
          shown on table 1, petitioner acquired 2,500 shares from another             
          shareholder.  This raised petitioner’s interest to 11.16 percent.           




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