Matthews v. Tele-Systems, Inc.

Miller, Judge.

As a director and approximate one-third shareholder of a close corporation, Tele-Systems, Inc., Charles Matthews agreed to the $12,000-per-month salaries of two other director/shareholders even though he knew the revenue stream of the corporation would not support such unless a hoped-for contract soon began producing substantial revenue. The contract eventually produced the revenue to support the salaries. Based on false statements by these two directors and the one other director/shareholder that a major client did not want Matthews on the board, Matthews later resigned his…