- 6 -
the notes signed during 1984 stated an interest rate. Petitioner
and Estes never executed any written loan agreements other than
the promissory notes. On September 6, 1989, Estes signed new
promissory notes to refresh the earlier notes, including a note
for $12,000 that Estes had borrowed from petitioner in 1981. The
new promissory notes provided that interest was due from the date
of the original loan, and that payment was due as of the date of
signing or upon demand. Estes made no payments of either
interest or principal on these notes, and petitioner made no
demand for payment until 1993.
During 1982, the Theratech device was being manufactured;
however, the company producing the device was unable to market it
in the United States because of FDA restrictions. As a result of
the marketing problems the Theratech stock suffered a precipitous
decline in value and was soon trading for much less than $1 per
share. Sometime between 1985 and 1987, Estes received a letter
from the Beijing Pharmaceutical Institute in Beijing, China. In
China, the Theratech device was being used experimentally to
treat rectal cancer. After a high-level Chinese Government
official used the device and was cured of rectal cancer, he
offered Estes the contract to build the Imperial Palace Hotel.
Although Estes knew nothing about building a hotel, petitioner
and a mutual acquaintance, who was an architect, did know about
such development projects. Seeing an opportunity to revive
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Next
Last modified: May 25, 2011