"The global settlement should enable Whitemark Homes Inc. to take advantage of the capital markets and obtain the financing necessary to acquire new project, as well as complete our existing one," Whitemark president and CEO Larry White says in a prepared statement.
The settlement terms were outlined in a form filed with the Securities and Exchange Commission on April 25. Whitemark is trading on the over-the-counter bulletin board in the 48-cents-per-share range.
Under part of the settlement terms, Whitemark is relinquishing properties with a book value of over $60 million and transferring $45 million worth of certain operating accounts payable, and short and long-term debt to the Adkinson group. These properties were deals Whitemark and the Adkinson group did since August 2001.
Whitemark will receive all ownership rights to five million shares of Whitemark Homes restricted common stock, collectively owned by the Adkinson group. The builder also gets the Orlando home of Michael Adkinson, subject to certain liens.
The legal timeline began in February when Whitemark and its wholly owned subsidiary, North Florida Consulting Inc., filed a lawsuit in the First Circuit Court in Walton County, FL.
The suit accused Michael Adkinson of removing a computer hard drive from Whitemark offices without permission. The court ruled the hard drive should be turned over to a third-party custodian with both Whitemark and Adkinson having access to the information on the drive.
In a countersuit, Adkinson and his group charged Whitemark's president and his executives with breaching a joint venture contract by failing to fund certain development projects. The counterclaim and a third-party complaint included an allegation of fraud in the inducement. The suit alleged Whitemark induced the Adkinsons to become joint venture partners by making certain false representations.
Besides White, other individual defendants listed in the suits and countersuits were Mitchell Gordon, Scott D. Clark and Orlando development planner Hugh Harling Jr. White and Gordon are Whitemark officers. Clark and Harling are Whitemark directors.
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