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TRUSTEE'S ORIGINAL COMPLAINT – Page 5
16. In addition to failing to complete its initial organization, Servers, Inc. failed to
comply with the requirements of the State of Nevada with respect to filing of franchise tax
returns and related requirements and, therefore, was in default and subject to the possible
revocation of its corporate charter. The Trustee took appropriate steps to advise Emke,
Herring and Servers, Inc. (collectively, "Defendants") of their default which has only recently
been remedied.
17. The Defendants have consistently failed to comply with their obligations under
the Agreement to creat
e a business plan and operate Servers, Inc. for the mutual benefit of
Emke and Ondova. These failures include:
(a) failed to produce and consult with and obtain Ondova's approval of a business
plan.
(b) failed to use "best efforts" to design and develop the Domain Name to serve as
the sales an
d marketing platform for Servers, Inc. By way of example, and not
limitation, there is no evidence that the Domain Name has generated, or will in
the near future, generate any revenues or that it ever engaged in the business of
PPC hosting.
(c) failed to identify small web hosting companies as well as secure the financing to
purchase th
e same.
(d) failed to provide the management services for which Emke is to be compensated.
By wa
y of example, and not limitation, though Emke and/or Herring formed
Servers, Inc. to own and operate the Domain Name, they have not even put forth
the minimum effort required to ensure that Servers, Inc. is in good standing as a
corporation in the State of Nevada.
2
(e) failed to provide an accounting of revenues from operation of the Domain Name
as an ad sit
e during portions of 2009 and 2010, failed to reimburse Ondova for
the $2,000 in operating costs funded by Ondova,
3
and failed to tender to the
Trustee Ondova's share of any ad site revenue.
(f) failed to use "best efforts" to promote and develop the business, as evidenced by
Emke's failure to develop a business plan (or e
ven discuss a business plan with
the Trustee), request operating capital, or generate revenues.
2
Based on research conducted on March 18, 2011, Servers, Inc. is currently in default status with the
Nevada Secretary of State.
3
In accordance with sections III and V of the Agreement, Ondova provided $2,000 to Emke as start up
capital (the "Start Up Funds"). See Agreement §§ III and V. The Start Up Funds were to be repaid to
Ondova from the first profits of Servers, Inc. To date, Emke has not repaid the Start Up Funds.
Case 11-03181-sgj Doc 1 Filed 03/22/11 Entered 03/22/11 15:30:41 Page 5 of 13
Case: 13-10121 Document: 00512627281 Page: 31 Date Filed: 05/12/2014