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On November 1, 1988, the date the 1968 note matured, a
meeting of Sainte Claire's board was held, which was also
attended by other shareholders, at which Mr. Boccardo requested
that the 1968 note be extended. In consideration of the
extension, Mr. Boccardo offered to pay interest on the principal
amount at the rate of 9 percent per annum. Mr. Boccardo
considered that rate to be more than the rate that Sainte Claire
would have received on another investment, such as a certificate
of deposit. He also preferred to deal with, and pay interest to,
Sainte Claire, a corporation that he partially owned, rather than
a third party, such as a bank. Mr. DiNapoli, who had experience
in banking, recommended acceptance of Mr. Boccardo's proposal
because he considered the interest rate offered to be
advantageous to Sainte Claire and Mr. Boccardo to be
creditworthy. After discussion by the board and shareholders
present, the board unanimously voted to accept Mr. Boccardo's
proposal, and that action was reflected in the minutes of the
meeting as follows:
WHEREAS, The Promissory Note dated November 1,
1968 in the sum of $2,087,500 executed by James F.
Boccardo, has matured, the following Resolution was
unanimously adopted:
BE IT RESOLVED, that this Corporation shall renew
the Promissory Note in the sum of $2,087,500 to
April 1, 1990, at an interest rate of Nine (9)
Percent, said note to be executed by James F.
Boccardo.
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