November 10, 1994
Dear Mr. Govaerts,
This is in response to your letter to Richard Bozulich dated November 8, 1994.
It is obvious from reading your letter that you simply do not know the full facts about Ishi Press International.
I can assure you that Richard Bozulich, by person and in proxy, did have more that 50% of the total outstanding shares at the time when he removed all of the directors of Ishi Press International pursuant to Section 303 (a) of the California Corporations Code.
The reason for your misunderstanding in this regard is that you undoubtedly believe that Nate Berkowitz is the holder of 158,000 shares.
I have personally read and examined the minutes of every meeting of stockholders or directors since the inception of this corporation in 1986 and at none of those meetings was there any authorization to issue 158,000 or any similar amount of shares to Mr. Berkowitz. Indeed, the subject never came up. It is clear from the section 3.1 (e) of the corporate bylaws that new shares can be issued only with the approval of the directors, and in this case no such approval was either sought or obtained. Mr. Bozulich, who has always been a director of this corporation since its inception, had never heard anything about this matter 158,000 shares until after his notification of the removal of the directors.
More than that, according to Mr. Berkowitz, he acquired the right to these shares by purchasing a promissory note from John Torode. However, the minutes also do not show any such note being issued to Mr. Torode, or that this note was convertible into Ishi Press International stock. Indeed, I understand that the John Torode note was issued by the London UK subsidiary, not by the then parent corporation. That subsidiary, which is now defunct, clearly did not have the right to issue stock in the parent corporation.
Accordingly, Mr. Berkowitz does not own any stock in Ishi Press International, other than the 10,000 shares which he purchased several years ago.
I suggest that you look up the case which I personally argued orally and won in the United States Supreme Court, which deals with similar issues: S.E.C. v. Samuel H. Sloan, 436 U.S. 103 (1978).
Very Truly Yours,
Samuel H. Sloan