ACCEPTED
03-14-00087-CV
3761677
THIRD COURT OF APPEALS
AUSTIN, TEXAS
1/14/2015 10:28:19 AM
JEFFREY D. KYLE
CLERK
NO. 03-14-00087-CV
FILED IN
In the Third Court of Appeals 3rd COURT OF APPEALS
AUSTIN, TEXAS
Austin, Texas 1/14/2015 10:28:19 AM
JEFFREY D. KYLE
Clerk
_______________________________________
Edwin Kiest Norton III,
Appellant,
v.
Mary Michelle Cheney,
Appellee.
_______________________________________
ORAL ARGUMENT DEMONSTRATIVES
_______________________________________
David F. Minton Lisa Bowlin Hobbs
State Bar No. 14192300 State Bar No. 24026905
Zooey Wharton Kurt Kuhn
State Bar No. 24008264 State Bar No. 24002433
Minton, Burton, Bassett & Collins, KUHN HOBBS PLLC
P.C. 3307 Northland Drive, Suite 310
1100 Guadalupe Austin, Texas 78731
Austin, Texas 78701 (512) 476-6003
(512) 476-4873 (512) 476-6002 (fax)
(512) 479-8315 (fax) Lisa@KuhnHobbs.com
Kurt@KuhnHobbs.com
COUNSEL FOR APPELLEE
ORAL ARGUMENT DEMONSTRATIVES
Appendix 1. ................................................................................................................. Timeline
Appendix 2 ..............................................................County Line Enterprises Stock Ledger
Appendix 3 .............Demonstrative of Norton’s County Line Enterprises Stock Shares
Appendix 4 ............................ Trial Court’s Valuation of County Line Enterprises Stock
2
Dated: January 14, 2015 Respectfully submitted,
/s/Lisa Bowlin Hobbs
David F. Minton Lisa Bowlin Hobbs
State Bar No. 14192300 State Bar No. 24026905
Zooey Wharton Kurt Kuhn
State Bar No. 24008264 State Bar No. 24002433
Minton, Burton, Bassett & Collins, P.C. KUHN HOBBS PLLC
1100 Guadalupe 3307 Northland Drive, Suite 310
Austin, Texas 78701 Austin, Texas 78731
(512) 476-4873 (512) 476-6003
(512) 479-8315 (fax) (512) 476-6002 (fax)
Lisa@KuhnHobbs.com
Kurt@KuhnHobbs.com
COUNSEL FOR APPELLEE
CERTIFICATE OF SERVICE
I hereby certify that on January 14, 2015, I served a copy of this Brief of Appellee
on counsel of record electronically, in accordance with the Court’s rules on electronic
filing, as listed below:
Nathan Kennedy via e-Service
1607 Nueces Street
Austin, Texas 78701
nkennedy@nathankennedylaw.com
John T. Beliveau via e-Service
Law Office of John T. Beliveau
100 Rocky River Road
Blanco, Texas 78606
jtbeliveaulaw@gmail.com
/s/ Lisa Bowlin Hobbs
Lisa Bowlin Hobbs
3
APPENDIX 1
TIMELINE OF KEY TRANSACTIONS
Walcutt dies.
Ricky Goss His shares are
shares are purchased by
purchased by Concepts and
CLE and redistributed as
retired as a partnership
CLE formed. treasury stock. distribution.
1988 1992 2006
1990 1995 2010
Norton & May: Rocky Goss Randy Goss
Cheney marry. shares are dies. As with
purchased by CLE Walcutt
and retired as transaction,
treasury stock. his shares are
purchased by
Concepts and
December: redistriubted
Concepts formed. as partnership
It is undisputed distribution.
that Concepts is a
community interest
partnership.
Norton and Cheney were married in 1990.
Concepts, a community interest partnership, was formed in 1995.
Concepts distributed 90,152 shares of CLE stock to Norton in 2006.
Concepts distributed 12,251 shares of CLE stock to Norton in 2010.
Norton acquired a total of 102,403 shares of CLE stock during his marriage to
Cheney from these two distributions.
There is no evidence in the record that Norton acquired these shares before his
marriage to Cheney.
APPENDIX 2
,\"'
The County Line Enterprises, Inc.
Stock Ledger
• .Cert.
No.
1
2
Date Issued
01/02/89
01/02/89
01/02/89
Person:or Entity
Bruce D. Walcutt
Richard L. Goss
#of Shar.es· Shares
Issued
105,918
105,918
105,916
..
O/S
0
0
0
Date
·Cancelled
10/16/06
05/18/92
03/14/89
·Replace-··
ment
Share#
34
25
21,22
Ref.
Comments.
1, 13
1,5
1
3 Edwin K. Norton Ill
4 01/02/89 Rocky L. Goss 40,816 0 05/18/95 31 1,9
5 01/02/89 Don A. Miller 20,708 20,708 1
6 01/02/89 Benjamin A. Collins 20,479 0 11/29/94 NIA 1,8
7 01/02/89 Randy J. Goss 8,145 0 10/01/10 38 1,14
8 01/02/89 Adrienne Milloy 4,100 0 06/28/95 32 1, 10
9 01/02/89 Bruce D. Walcutt 26,270 0 03/04/89 ·17,20 1,2
10 01/02/89 Richard L. Goss 26,270 0 03/04/89 18,20 1,2
·. ·11 01/02/89 Edwin K. Norton !II 26, 180 0 03/04/89 19,20 1,2
12 01/02/89 Rocky L. Goss 10,090 0 05/18/95 31 1,9
13 01/02/89 Don A. Miller 5,050 5,050 1
:14. 01/02/89 Benjamin A. Collins 5,120 0 11/29/94 N/A 1,8
15 01/02/89 Randy J. Goss 2,020 0 10/01/10 38 1, 14
16 01/02/89 Adrienne Milloy 1,000 0 06/28/95 32 1, 10
'17 03/04/89 Bruce D. Walcutt 17,724 ·o 10/16/06 34 2, 13
·18 · . 03/04/89 Richard L. Goss 17,724 0 05/18/92 25 2,5
..19 03/04/89 Edwin K. Norton Iii 17,634 0 03/31/89 23,24 2,4
20 03/04/89 John Blazier-Agnt 25,638 0 01/14/93 26,27,28 2,6
.. 21 03/14/89 Edwin K. Norton Ill 86,458 0 03/31/89 23,24 3
22 03/14/89 Edwin K. Norton Ill 19,458 0 03/31/89 23,24 3
• . 27
23
"24
25
26
.28
03/31/89
03/31/89
05/18/92
01/14/93
01/14/93
01/14/93
Edwin K. Norton Ill
Edwin K. Norton Ill
CLE, Inc.
Bruce D. Walcutt
Edwin K. Norton If I
CLE, Inc.
24,710
98,840
123,642
8,546
8,546
8,546
24,110
98,840
0
0
8,546
0
03/01/94
10/16/06
29, 30
34
4
4
5,7
6
6
6
::·29 03/01/94 Don A. Miller 18,500 18,500 7
·. 30 03/01/94 CLE, Inc. 105,142 0 7
. 31 06/15/95 CLE, Inc. 50,906 0 9
..32 06/28/95 Adrienne Milloy 5,100 0 06/28/95 N/A 10, 11
·33. 07/01/95 Don A. Miller 7,138 0 10/15/10 41 12, 15
34 10/16/06 CLC 132,188 0 11/09/06 35,36,37 13
.35 11/09/06 Edwin K, Norton Ill 90,1?2 90, 152 13
36 11/09/06 Don A. Miller 35,162 35,162 13
37 11/09/06 Randy J. Goss 6,874 0 10/01/10 38 13
38 10/01/10 CLC 17,039 0 10/01/10 39,40 14
39 10/01/10 Edwin K. Norton Ill 12,251 12,251 14
40 10/01/10 Don A. Miller 4,788 4,788 14
41 10/15/10 Don A. Miller 7,138 7, 138 01/01/00 15
-
Edwin K. Norton Ill 234,499
- ,.
----Goo-A~ -94:.:" ·-
.~ ·~
Total 325,845
• G:ICLIENTSICL 0317\CLE\Stock Ledger 2010
. ··--·---- --------
THE COUNTY LINE ENTERPRISES, INC~
STOCK LEDGER REFERENCE COMMENTS
•
1. Initial Stock Distribution by The County Line Enterprises, Inc. ("CLE")
2. Bruce Walcutt, Richard Goss and Edwin Norton surrendered 8,546 Shares each
(Certificate Nos. 9, 10, and 11 were cancelled and Certificate Nos. 17, 18, and 19
were issued) for a total of 25,638 Shares which were issued to John C. Blazier,
Escrow Agent as Share Certificate No. 20 for Don IVJ.iller to acquire (Certificate
No. 29 I 18,500 Shares and Certificate No. 33 I 7,138 Shares).
3. Ed-win Norton - Equal exchange of Shares. Certificate No. 3 I 105,916 Shares
was cancelled. Certificate No. 21 I 86,458 Shares and Certificate No. 22 I 19,458
Shares (Total of 105,916 Shares) were issued.
4. Edwin Norton - Reissue of Shares to allow a division of the existing Shares into
two Certificates for pledging of 98,840 Shares to Alliance Bank to secure existing
•
debt. Certificate No. 19 I 17,634 Shares, Certificate No. 21 I 86,458 Shares, and
Certificate 22 I 19,458 Shares (Total of 123,550 Shares) were .cancelled.
Certificate No. 23 I 24,710 Shares· and Certificate No. 24 I 98,840 Shares (Total
of 123,550 Shares) were issued.
5. CLE purchased Richard Goss' 123,642 Shares (Certificate No. 2 I 105,918 Shares
and Certificate No. 18 I 17, 724 Shares were cancelled) as Treasury Stock.
Certificate No. 25 (123,642 Shares) was issued to CLE on 5/18/92. Outstanding
Shares were reduced from 514,000 Shares to 390,358 Shares (514,000 - 123,642
= 390,358).
6. John C. Blazier, Escrow Agent transaction (see Comment No. 2 above) was
terminated. Certificate No. 20 I 25,638 Shares was cancelled. Certificate No. 26
I 8,546 Shares was issued to Bruce Walcutt. Certificate No. 27 I 8,546 Shares
was issued to Ed~ Norton. Certificate No. 28 I 8,546 Shares was issued to CLE
as Treasury Stock. Outstanding Shares were reduced from 390,358 to 381,812
Shares (390,358 - 8,546 = 381,812).
7. Don Miller acquired 18,500 Shares (Certificate N9. 29 I 18,500 Shares) from
•
CLE Treasury Stock. Certificate No. 25 I 123,642 Shares was cancelled.
THE COUNTY LINE ENTERPRISES, INC.
STOCK LEDGER REFERENCE COMMENTS
• Certificate No. 30 I 105,142 Shares was issued to CLE. Outstanding Shares were
increased from 381,812 to 400,312 Shares (381,812 + 18,500 = 400,312).
8. CLE purchased Benjamin Collins' 25,599 Shares (Certificate No. 6 I 20,479
Shares and Certificate No. 14 I 5,120 Shares were cancelled) as Treasury Stock.
No new Share Certificates were issued tq CLE. Outstanding Shares were reduced
/
from 400,312 Shares to 374, 713 Shares ( 400,312 - 25,599 = 374, 713).
9. CLE purchased Rocky Goss' 50,906 Shares (Certificate No. 4 I 40,816 Shares
and Certificate No. 12 I 10,090 Shares were cancelled) as Treasury Stock.
Certificate No. 31 I 50,906 Shares "was issued to CLE on 6/15/95. Outstanding
Shares were reduced from 374,713 Shares to 323,807 Shares (374,713 - 50,906 =
323,807).
10. Adrienne Millay's Original Share Ce1iificate No. 8 I 4,100 Shares and No. 16 I
•
1,000 Shares (Total of 5,100 Shares) were deemed to be lost. Therefore,
Certificate Nos. 8 and 16 were cancelled and replaced by Share Certificate No. 32
I 5, 100 -Shares.
11. CLE purchased Adrienne Millay's 5,100 Shares (Ce1iificate No. 32 I 5,100
Shares was. cancelled) as Treasury Stock. No new Share Certificates were issued
to CLE. Outstanding Shares were reduced from 323,807 to 318,707 Shares
(323,807 - 5,100 = 318,707).
12. Don Miller acquired 7,138 Shares (Ce1iificate No. 33 I 7,138 Shares) from CLE
Treasury Stock. Outstanding Shares were increased from 318, 707 Shares to
325,845 Shares. (318,707 + 7,138 = 325,845).
,, .
1:J. The County Line Concepts, Ltd. ("CLC") I CLE purchased Bruce Walcutt's
132,188 Shares (Certificate No. 1 I 105,918 Shares and Certificate l'qo. 17 I
17, 724 Shares and Certificate No. 26 I 8,546 Shares were cancelled) and
redistributed said Shares prQraJ._a_t.o_the_remaining Sbar.ehol.de~~
34 I 132,188 Shares-was issued to CLC and then cancelled. Certificate No. 35 I
90,152 Shares was issued to Edwin Norton. Certificate No. 36 I 35,162 Shares
•
- - - - - - - - · - - - - - · --· --·
'.
THE COUNTY LINE ENTERPRISES, INC.
STOCK LEDGER REFERENCE COMMENTS
• was issued to Don Miller. Certificate No. 37 I 6,874 Shares was issued to Randy
Goss. Outstanding Shares remained constant at 325,845 Shares.
14. CLC I CLE purchased Randy Goss' 17,039 Shares (Certificate No. 7 I 8,145
Shares, Certificate No. 15 I 2,020 Shares and Certificate No. 37 I 6,874 Shares)
and redistributed said Shares prorata to the remaining Shareholders. Certificate
No. 38 I 17,039 Shares was issued to CLC and then cancelled... Certificate No. 39
I 12,251 Shares was issued to Edwin Norton. Certificate No. 40 I 4,788 Shares
was issued to Don Miller. Outstanding Shares remained constant to 325,845
Shares.
15. Don Miller's Original Share Certificate No. 33/ 7,138 Shares was deemed to be
lost. Therefore, Certificate No. 33 was cancelled and replaced by Share
Certificate No. 41/ 7,138 Shares .
• g:lclicntslcl 0317\clclstock.lodgcr.lO IO.doc
•
APPENDIX 3
514,000 25.7%
3. 3/4/89 11 c - 26,180 - - -
4. I 3/4/89 19 I 17,634 - 123,550 514,000 24.0%
5. 3/14/89 3 c - 105,91~1 I Equal exchange of Shares (105,916 Shares
6. 3/14/89 21 I 86,458 - for 105,916 Shares).
7. 3/14/89 22 I 19,458 -I 123.550 I 514 .000 I 24.0%
8. 3/31/89 19 c - 17,634
9. 3/31/89 21 c - 86,458 - - - Reissue EN Shares to allow a division of the
existing Shares into iwo Certificates for
10. 3/31/89 22 c - 19,458 - - - pledging of 98,840 Shares to Alliance Bank to
11. 3/31/89 23 I 24,710 - - - - secure existing debt.
::>'
12. 3/31/89 I 24 I 98,840 - 123,550 514,000 24.0%
I 5/18/92 j· - - 123.550 I 31.7%
13. - -1 390,358
14. 8,546 132,096 381,812 34.6%
1/14/93 27
15. 3/1/94 - - - ., 132,0961 400,3121 33.0%
16. 111/29/94 - -
-I 132,0961 374,7131 35.3%
17. I 5/23/95 I - - -T T 132,0961 323,8071 40.8%
18. 6/28/95 I - -I -I 132,0961 318,7071 41.5%
19. 7/1/95 - -I -I 132,096 325,845 I 40.5%
20 . I 11/9/06 · I 35 I 90,152 I -I 222,248 325,8451 68.2%
I redistributed said Shares pn
Shareholders.
CLC I CLE purchased Randy
21. I 10/1/10 I 39 I I 12,251 I -I 234,499 I 325,845 I 72.0% I Sl1ares (Certificate Nos. 7, 15 & 37) and
redistributed said Shares prorata to remaining
APPENDIX 4
Price per share in CLE corporate documents = $45.82
No contractual provision for discounting price
Cheney’s Expert Norton’s Expert Trial Court
Overall Price Per Share $45.82 $40.97 $40.97
Marketability Discount 15% 45% 25%
Lack of Control Discount 0% 35% N/A
Total Price Per Share $38.67 $14.65 $30.73