In the Matter of Melinda Pillsbury-Foster and Green Hills Software, Inc.
RE: Stock Options, Power of Attorney (Irrevocable), Promissory Notes and Corporate Loans
On of about November 25th, 2004 Melinda Pillsbury-Foster (“MPF” hereinafter) inquired of me to investigate options to exercising Green Hills Software (“GHS” hereinafter) “Founders” or “Original Stock” Purchase Options.
MPF owns an outright Option to purchase 143,314 of original Stock of GHS. MPF has “borrowed” -$ 430,000.00 against her “Stock Option.” Purchase Price of the common stock is $1.00 shares. These shares are currently believed to be valuated in the $8.00 to $10.00 per share range.
There appears to be gross improprieties in the transaction(s) conveying ownership interest in real “stock” and circumstances leading to MPF's right in the described stock options.
After receiving and reviewing a court order approval of a “Consent Agreement” in the form of a “Settlement Agreement” comprised of an Offer to Settle, Promissory Note, and Power of Attorney for MPF I researched applicable California and U.S. Laws relevant to this series of events and transactions which have concluded with the above and herein more fully described Stock Option Issues.
It appears that there were a couple of civil actions pertinent and relevant to the issues at hand.
It would appear that a divorce, maintenance, and support action was initiated by MPF against Allen Craig Franklin (“Franklin” hereinafter).
During the course of this action it was discovered through the “Income and Equitable Distribution” phase of the Support and Maintenance proceedings that Craig Franklin and GHS acted improperly in attempting to intentionally conceal portions of, or reduce Franklin's income.
Franklin, individually or in his official capacities as an employee, manager, director, board member, or otherwise in service to GHS can NOT conspire with the company to do any act as US Supreme Court has found that as a whole employees are the company and a company cannot conspire with itself (citation omitted).
However, it is noted that any third parties like accountants and attorneys are NOT employees within the US Sup. Court opinions.
It appears a separate civil action was brought for what appears to be fraud claims by MPF against GHS, Franklin, and others.
This second action appears to have proceeded to trial and was summarily dismissed, or more accurately disregarded and joined to the domestic relations case and promptly sent back to be heard (or ignored) in the “Family Court” supposedly under the judge's claim that MPF “had already been compensated” regardless of the fact that fraud is a criminal act with civil remedies that are mandatory upon the finding of the fraud since the crime is the intent to deprive regardless of the recovery of any loss.
It is apparent the judge in this action took no steps to report the crime(s) to any investigative authority within the state's law enforcement divisions(s) since no records can be produced that complain of any misconduct of GHS to date. Certain statements made by Daniel O'Dowd during the January 9th deposition clearly indicate there was some wrong doing by Franklin and executives of GHS ans it was known, and largely ignored by members of the Board of Directors of GHS.
MPF is listed by GHS as an “employee” even though she has never worked for GHS. MPF has never received a 1099 or any other wage or earnings statement statement from GHS or her agent, UPOA.
CA POA – UPC (Uniform Probate Code) REQUIRE instruments to be specific and complete in form and content as well as in compliance with state and federal laws that pertain directly to actions and assignees. Additionally, California has specific “Conflict of Interest” statutes separate and apart from other codes as a matter of public policy.
After due and diligent inquiry I, Jay Gell, find that:
a. The entire transaction that appears to transfer valuable stock options to Melinda Pillsbury-Foster was:
- Designed to prevent MPF from ever exercising the “stock options.”
- The GHS POA held, “for the benefit of MPF,” does not comply with the California laws regarding powers of attorney and creates a conflict of interest by assigning a GHS employee, agent, officer, or other person subject to influence or insider information about corporate interest.
- Crafted to conceal the attempt to deny MPF the opportunity to ever exercise the “valuable stock options,”which she accepted in lieu of receiving an actual cash settlement.
- And other notations within the margins of the included codes and regulations.
b. The “note” for $300,000.00 fails to reasonably comply with California laws.
- By excluding any fee schedule, or
- Amortization table, and
- Provides no terms for weekly, monthly, yearly, or variants of either and
- Does not explain or express total interest accrued or paid through the terms of the note or “loan”, and
- other technical failings as outlined and notated in the attacked California Code.
c. There is reason to believe that GHS, it's agents, assignees, employees, and officers have acted inappropriately in this matter and possibly others that would negatively impact it's plans for an IPO should the SEC delve into the right set of books.