Plaintiff Sunshine was formed along with its subsidiaries, Sunbelt Airlines, Inc. and Sunbelt Rent-A-Car, Inc., to engage in the passenger airline and automobile rental business (“business”). In order to obtain funds for the business, Plaintiff entered into a Subscription Agreement with Defendant LTS Business Trust (“LTS”) which provided that LTS would purchase 60,000 shares of Series A Preferred Stock at a price of $100 per share, for a total purchase price of $6,000,000, payable in the following manner: $60,000 at closing (July 29, 1993), $1,940,000 on August 6, 1993 and $4,000,000 on September 15, 1993. The last two payments were evidenced by two promissory notes executed on July 29, 1993. On June 26, 1993, Defendant Simpson, on behalf of LTS, signed a letter confirming the terms of the Subscription Agreement. On July 29, 1993, Defendant Jolly, as authorized trustee, signed the Subscription Agreement and two promissory notes on behalf of Defendants Simpson and LTS.
In addition, Defendants Simpson, LTS and Jolly presented a “Trust Receipt” from First National Bank Ltd. to Plaintiff which stated that LTS had deposited in said bank, $25,000,000 in government securities. The “Trust Receipt” was false, as it was never actually funded and was presented allegedly to deceive Plaintiff.
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'Independent Covenant' Language in Restrictive Covenants
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