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board members on decisions of consequence. Sainte Claire's board
held periodic meetings, certain of which other shareholders would
attend.
During 1968, Mr. Boccardo purchased two prune ranches, known
as the Arboga and Gridley ranches, from Sainte Claire. Mr.
Boccardo assumed the existing mortgages on the ranches and gave
Sainte Claire a promissory note (1968 note) dated November 1,
1968, in the amount of $2,087,500 that bore interest at the rate
of 6-� percent per annum, payable semiannually, and that provided
for a balloon payment of the principal on or before November 1,
1988. Although the 1968 note stated that it was secured by deed
of trust, it was actually unsecured. Mr. Boccardo sold the
Gridley ranch during 1975. He sold the Arboga ranch during
October 1988 for $5,150,000.
Prior to the time that the 1968 note became due, Mr.
Boccardo discussed the possibility of extending it with Mr.
DiNapoli, Ms. O'Connell, and others. Mr. Boccardo requested the
extension because commitments made by him in connection with his
real estate investments had left him short of cash, and he would
have been obliged to borrow in order to pay the 1968 note. At
the time that the 1968 note was due, Mr. Boccardo, a successful
attorney and real estate investor, was worth approximately $50
million and had a substantial income. Mr. Boccardo would have
paid the 1968 note had Sainte Claire requested it.
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