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On September 24, 1998, Superwire (P) and Entrata entered into a loan and option agreement. Superwire (P) agreed to provide $2 million of financing to Entrata in exchange for an option to purchase 51% of the outstanding stock of Entrata (D). The agreement was amended to loan $6 million more to Entrata. At the same time, the parties entered into a stock purchase agreement where Superwire (P) exercised its option to purchase 51% of the stock of Entrata (D): acquiring 3,479,843 shares of Series D Preferred Stock. Superwire (P) contends that the Series D shares entitle it to maintain a share ownership level having not less than fifty-one percent (51%) of the voting power of all Entrata (D) securities. The deal also included a stockholders' agreement where the stockholders who were parties thereto would vote their shares to cause the Entrata (D)board to consist of seven designated members. P sued D, alleging that Entrata (D) breached the Loan and Option Agreement by failing to provide the budget information. Superwire (P) refused to advance funds, and Hampton (D) refused to acknowledge the Superwire (P) designees on Entrata's board and also asserted that the 51% of Entrata (D) stock purchased by Superwire (P) was not validly issued due to Superwire's (P) defaults under the Loan and Option Agreement. The parties entered an agreement where Entrata (D) recognized Superwire's (P) ownership of 3,479,843 shares of Series D Preferred Stock and 100,000 shares of Series C Preferred Stock constituting 51% of the Company's outstanding voting stock. Entrata (D) again demanded funds, and Superwire (P) refused to provide because, it claimed, the necessary budgetary disclosures had not been made. Hampton (D) again disputed both the membership of the Superwire (P) designees on the Entrata board and Superwire's 51% ownership of Entrata (D). Entrata (D) also issued additional voting stock (together with later-issued shares, the 'Extra Shares'), allegedly without complying with the provisions of the Certificate of Designation giving Superwire (P) the ability to maintain its 51% voting position. The parties entered into a six-month standstill agreement. Entrata (D) again acknowledged Superwire's (P) legal ownership of 3,479,843 shares of Series D Preferred Stock and 100,000 shares of Series C Preferred Stock of Entrata (D). Entrata (D) also acknowledged Superwire's (P) entitlement to, and agreed to issue to Superwire (P) within thirty days, 103,451 additional shares of Series D Preferred Stock, 'representing shares due to Superwire (P) under the anti-dilution provisions of the Transaction Documents with regard to ESOP shares exercised.' The Standstill Agreement provided for a five-member board, two each designated by Entrata (D) and Superwire (P) and the fifth by BTR-LLC. The Standstill Agreement terminated in August 2001. Ps allege that Ds promptly breached the Standstill Agreement. It claims that Entrata (D) did not recognize Superwire's (P) board designees, did not provide Superwire (P) with the required certified annual financial statements. and did not issue the promised stock as it had agreed. Superwire (P) joined with other Entrata (D) shareholders to execute an action by written consent of the holders of a majority of Entrata's voting stock purporting to remove Hampton (D) from the board of directors 'for cause.' Superwire (P) delivered a second written consent to Entrata (D), purporting to remove all directors other than May and Merelli and electing Truher, Macary and Jakubiak to the board. The new board of directors then acted to terminate the employment of Hampton (D), Compagnoni and Wilkinson. They also acted to appoint Merelli as CEO, President, Secretary and Treasurer of Entrata (D). Superwire (P) contends it is the majority stockholder, and the latter consent must be given legal effect. Ps seek a declaration that Hampton (D), Saad and Compagnoni were removed by written consent of Entrata's (D) shareholders and were replaced by Truher, Macary and Jakubiak, and Merelli was validly appointed. Ds moved to dismiss Superwire’s (P) complaint because the complaint did not allege facts showing that Hampton (D) was afforded notice of the charges and an opportunity to be heard before his removal. Ds moved pursuant to Rule 12(b)(6) to dismiss for failure to state a claim upon which relief can be granted. Superwire (P) claims it was not required to allege facts and that Entrata’s (D) certificate of incorporation allowed directors to be removed without cause, so Ds’ arguments were irrelevant.

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