purchase the Institute. The agreement was signed on June 6, 1989, by Reynolds and Walter K. Guillot (Guillot) who signed as president of WKG. The selling price was $100,000; $50,000 of which had previously been given to WKG as a deposit and the balance of $50,000 to be paid upon completion of the sale. Upon completion of the sale which was scheduled for July 1st, Reynolds was supposed to take over operation of the Institute.
The contract provided that WKG was to create a new corporation, DR Education Corporation, Inc. (DR), which was to be incorporated in Texas. Immediately thereafter, WKG was to transfer the Institute to DR; obtain DR's approval as a "free standing" school by the Southern Association of Colleges and Schools; and obtain the approval ofthe transfer of ownership to DR by the U.S. Department of Education and the Guaranteed Student Loan Corporation which approval was to have been obtained by July 1, 1989.
The accreditation of DR by the Southern Association of Colleges and Schools as a free standing school was obtained on June 30, 1989. Notice of the accreditation was received on July 4. At that time WKG was able to apply to various regulatory agencies for the requisite approval.
Pursuant to the agreement of June 6th, Reynolds, through his two sons, took over operation of the Institute on July 1st even though the Institute had never been transferred to DR. Reynolds kept urging WKG, Guillot and Murvin, a WKG employee, to complete the transfer to DR so that the sale could be