IN THE CIRCUIT COURT OF ST. LOUIS COUNTY, MISSOURI TWENTY-FIRST JUDICIAL CIRCUIT PETITION

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1 IN THE CIRCUIT COURT OF ST. LOUIS COUNTY, MISSOURI TWENTY-FIRST JUDICIAL CIRCUIT ROLAND S. KESKE, Plaintiffs, Case No. v. Division No. TODD A. KESKE, Serve: 4387 N. Rider Trail Earth City, MO KAREN A. KESKE Serve: 1449 Bald Eagle Road Wildwood, MO and FOAM SUPPLIES, INC. Serve: Todd A. Keske Registered Agent 4387 N. Rider Trail Earth City, MO Defendants. 17SL-CC00595 PETITION COMES NOW Roland S. Keske, by and through his undersigned counsel, and for his Petition against Defendants Todd A. Keske, Karen A. Keske, and Foam Supplies, Inc. (hereinafter Todd, Karen and Foam Supplies, Inc. are collectively referred to as Defendants, and states as follows: Parties, Jurisdiction and Venue 1. Roland S. Keske is an individual citizen of the state of Illinois over the age of 18 years.

2 2. Defendant Todd A. Keske is a resident of St. Louis County, Missouri, residing at 117 Ridgecrest Dr. Chesterfield MO, Defendant Karen A. Keske is a resident of St. Louis County, Missouri residing at 1449 Bald Eagle Rd. Wildwood MO, Foam Supplies, Inc. is Missouri corporation organized under the laws of the State of Missouri, with a principal office located at 4387 N. Rider Trail, St. Louis County, Missouri, (hereinafter referred to as FSI or the Company. 5. Jurisdiction and venue are proper in this Court in that St. Louis County is the principal location of the Company, and is the county in which the actions leading to this litigation took place. Defendants are further subject to personal jurisdiction as residents of St. Louis County, Missouri, and as a result of the actions taken by Defendants alleged herein which occurred in St. Louis County, Missouri. Background 6. Plaintiff is the owner of both Class A shares of FSI stock and Class B shares of FSI Stock. 7. Todd Keske is President of the Company and a Director. 8. Karen Keske is Secretary of the Company and a Director. 9. As described more fully below, Defendants have engaged in conduct as Officers and Directors of the Company in violation of one or more of the fiduciary duties they owed to Plaintiff as an owner of the Company. Defendants also acted contrary to the interests of Plaintiff by using and/or diverting resources and/or assets of the Company for their own personal benefit and to the direct detriment of Plaintiff. These breaches were for duties owed directly to Plaintiff by Defendants, and the damages sustained were deliberately and intentionally directed at Plaintiff. 2

3 COUNT I BREACH OF FIDUCIARY DUTY AND STANDARD OF CARE OBLIGATIONS AGAINST DEFENDANTS TODD KESKE AND KAREN KESKE 10. Plaintiff realleges and incorporates Paragraphs 1 through 9, as set forth fully herein. 11. Plaintiff entrusted Defendants Todd Keske and Karen Keske to run all the activities of the Company with the best interests of all the shareholders in mind, including the Trust and the Trust beneficiaries. 12. Upon information and belief, Defendants Todd Keske and Karen Keske, as Officers and Directors, acted in a manner contrary to their obligations, for their own personal benefit, and not in the best interests of the Plaintiff, by engaging in the following conduct: A. Using corporate assets for personal benefit and gain; specifically: i. Using the Company plane for personal uses unrelated to business purposes; ii. Diverting Company funds for the construction and/or renovation for Todd Keske s personal residence; iii. Using Company funds to pay for the personal expenses of Todd Keske and Karen Keske; iv. Failing to maintain the proper accounting of the books and records of the Company in an accurate manner; v. Failing to cause the Company to submit the proper IRS tax forms to Todd Keske and Karen Keske for benefits derived from Company assets subjecting the Company to tax penalties; vi. Failing to distribute dividends as historically distributed; vii. Paying the Officers of the Company excessive compensation to the detriment of Plaintiff; and 3

4 viii. Failing to provide Plaintiff the necessary Company documents to properly evaluate his interests. ix. Improperly diluting the beneficial interests of Roland Keske. x. Improperly threatening cash calls in an effort to coerce Roland Keske s compliance regarding certain corporate activities. 13. By reason of the foregoing, Defendants breached their fiduciary duties to Plaintiff and failed to act in accord with the terms of the best interests of all the shareholders, and to the benefit of Defendants and to the detriment of Plaintiff. 14. These breaches of fiduciary duty were intentional, willful, and outrageous as Defendants themselves and through the Company engaged in this course of action for their sole personal benefits and to the detriment of Plaintiff. 15. As a result of these breaches, Plaintiff has been directly damaged as a result. WHEREFORE Plaintiff Roland S. Keske prays this Court enter judgment in his favor and against Defendants and award Plaintiff Roland S. Keske compensatory and punitive damages against Defendants for their breach of fiduciary duties in amounts to be proven at trial (in excess of $25,000.00, and for such further and other relief this Court deems just and proper. as follows: COUNT II ACCOUNTING COMES NOW Plaintiff and for Count II of his cause of action against Defendants states 16. Plaintiff realleges and incorporates herein by reference Paragraph 1 through 15 of Plaintiff s Petition. 17. Upon information and belief, Plaintiff alleges that Defendants utilized Company assets for their own self-dealing. 4

5 18. Upon information and belief, Plaintiff alleges that Defendants took advantage of certain corporate opportunities and assets for their own benefit. 19. Defendants have acted unjustly, unfairly, and wrongfully in engaging in the conduct described herein. 20. A full and complete accounting of FSI is necessary to determine and trace the unjust conduct of Defendants. WHEREFORE, Plaintiff prays that judgment be entered against Defendants for an accounting of the financial and business records of the Company in order to account for and trace any amounts or asserts wrongfully diverted and usurped from the Company, plus Plaintiff s attorney s fees and costs expended herein, and any such other and further relief as the Court deems just and proper COUNT III - CONSTRUCTIVE TRUST COMES NOW Plaintiff and for Count III of his cause of action against Defendants states as follows: 21. Plaintiff realleges each and every allegation contained within Paragraphs 1 through 20 of this Petition. 22. Defendants have acted unjustly and wrongfully in obtaining, retaining, using, diverting and/or usurping revenues, monies and/or assets of the Company for their own benefit and to the detriment of Plaintiff. 23. Allowing Defendants to retain said revenues, monies and/or assets of the Company wrongfully diverted and usurped from the Company would unjustly, unfairly and wrongfully enrich Defendants to the detriment of Plaintiff. 5

6 24. A constructive trust in favor of Plaintiff should be imposed by this Court on any such monies and/or the assets, property or goods wrongfully obtained by Defendants. WHEREFORE, Plaintiff prays that judgment be entered against Defendants imposing a constructive trust on any such wrongfully obtained monies and/or the assets, or any monies, property or goods wrongfully diverted and usurped by Defendants, plus Plaintiff s attorney s fees and costs expended herein, and, any such other and further relief as the Court deems just and proper. MCCARTHY, LEONARD & KAEMMERER, L.C. By: /s/ Brian E. McGovern Brian E. McGovern, #34677 Robert A. Miller, # Maryville Centre Drive, Suite 300 Town & Country, MO Telephone: ( Facsimile: ( bmcgovern@mklaw.com rmiller@mlkaw.com Attorneys for Plaintiff Roland Keske 6