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On March 18, 1997, Mr. Marcus mailed a letter to a potential
business partner. Mr. Marcus wrote: “As of January 25, 1997 Joe
Dunne was terminated as an employee of FRC, therefore he does not
speak for or represent the company in anyway. In addition, it is
our position that Joe has in effect sold his shares of stock to
me.”
The Settlement Agreement
On May 8, 1997, Mr. Dunne and Mr. Marcus executed a
settlement agreement. This agreement provided that in exchange
for his 50-percent interest in FRC, Mr. Dunne would receive
$175,000 plus 50 percent of FRC’s total net profit from the halon
contract. The parties agreed that the payment of $175,000
represented FRC’s net book value. The settlement agreement
provided that the $175,000 was payable as of the date of
settlement (the settlement date), but also that it was payable in
seven equal monthly payments beginning on June 1, 1997.
Regarding Mr. Dunne’s FRC stock, the settlement agreement
provided:
TO BE DELIVERED IN ESCROW FULLY ENDORSED PENDING FINAL
DISTRIBUTION OF ALL MONIES DUE UNDER HALON CONTRACT &
TWO ESCROW ACCTS, OR PAYMENT OF NET B.V. OF FRCI,
WHICHEVER IS LATER. NO SHAREHOLDER OR DIRECTOR RIGHTS
IN JDD AFTER DATE OF SETTLEMENT. ESCROW ACCT PROCEEDS
TO BE DISTRIBUTED NET OF ALL COSTS & EXPENSES 1/2 TO
JDD & 1/2 TO RMM.
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Last modified: March 27, 2008