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b. Funds to Buy Tree and Advances to Tree
On May 25, 1987, LTL asked LIIBV to make a $20 million loan
to LAC on May 28, 1987. As stated at par. I-C-1, above, LTL used
LAC to buy Monroe, which became Tree. On May 27, 1987, LAC and
LTI signed loan agreements with LIIBV, which had the same terms
as LIIBV's July 7, 1987, agreements with LWSI and Transit. LTI
guaranteed repayment of the LIIBV advances to Tree.
c. LIIBV's September 12, 1988, Board Meeting
On September 12, 1988, the members of LIIBV's board of
directors discussed repayment by Transit, LWSI, and Tree of the
advances from LIIBV. At that time, the advances were due to be
repaid on September 1, 1989. The board decided to extend the
repayment date. The minutes for that meeting stated that LIIBV's
management did not intend to request repayment.
6. Repayment of Principal
Petitioners did not repay any principal to LIIBV from the
date of the initial advance in December 1985 to October 1989.
Petitioners repeatedly extended the due date for most of the
principal amounts that petitioners owed to LIIBV.
Up until the time of trial, petitioners and their
subsidiaries had not reduced the total unpaid balances that they
owed to LIIBV below the $975,153,806 which was outstanding as of
August 31, 1988.
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