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§16.104 To ratify the sale of Common Stock to an officer or director of the corporation subject to a repurchase right if the purchaser fails to meet certain conditions subsequentSALE OF STOCK TO THOMAS C. ANDERSEN On December 15, 1977, the Company sold to Thomas C. Andersen, a director of the Company, 250,000 shares of Common Stock (the "Shares") at a cash purchase price of $1.00 per share or an aggregate purchase price of $250,000. The bid and asked prices of the Company's Common Stock on that date as reported in The Wall Street Journal were $1.375 and $1.875, respectively. The $1.00 purchase price had been agreed upon at a time when the average of the bid and asked prices was $1.00. The difference between the market price and purchase price was, therefore, a result of market fluctuation and not an attempt by the Company to sell Mr. Andersen stock at less than the market value. The Shares represent approximately 20% of the outstanding Common Stock of the Company, making Mr. Anderson the largest shareholder of the Company (and the only shareholder with more than 10% of the outstanding Common Stock). Under the agreement pursuant to -which the Shares were sold, Mr. Andersen has agreed that (1) if lie does not accept all of one or more corporate positions (Chairman of the Board, Chairman of the Executive Committee, Chief Executive Officer) which the Board of Directors of the Company intends to offer him at the Annual Board of Directors' Meeting immediately following the 1978 Annual Meeting of Shareholders, or (2) if lie does not serve in such position or positions for at least 1 year (subject to certain exceptions), the Company has the option to repurchase the Shares at their original price of $1.00 per share. The primary reasons for the sale were to obtain additional capital and to provide an incentive to Mr. Andersen to assume one or more of these positions. Because the Shares have not been registered under the Securities Act of 1933, as amended, the Company has agreed that Mr. Andersen bas the right (subject to certain limitations) to request one such registration of his Shares at the Company's expense. Pursuant to the stock purchase agreement, the Company has agreed, so long as Mr. Andersen holds at least 200,000 of the Shares, (1) not to increase the Board of Directors to more than 10 persons, and (2) to nominate as directors Mr. Andersen and one other person designated by him. In the event Mr. Andersen holds less than 200,000 but more than 100,000 Shares, he is entitled to be designated as a nominee.