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1982, report that Lea demanded payment of the delinquent amounts,
and that the corporate officers considered whether Cascade could
make the payments. Because the corporation required all its
working capital to build its inventory of goods available for
sale, Lea suggested that Cascade get a loan from a bank or that
the other officers make loans to the corporation so that Cascade
could pay the amounts owed to him. The other officers rejected
this proposal.
The minutes of the officers' meeting on December 1, 1982,
reported that $130,000 of the amount owed to Lea would be paid
during the month, but the balance due in April would not be paid
until July or August of 1983. These minutes also report that Lea
had consulted a lawyer about the patent payments and intended to
meet with him again. The minutes of the February 23, 1983,
meeting report that $250,000 was still due Lea and could not be
paid. At this meeting, the officers discussed setting up an
installment schedule to pay the outstanding balance over time.
After Lea's consultations with his lawyer, Lea and Cascade
agreed to renegotiate the 1979 sales agreement. The renegotiated
agreement (the 1982 agreement3 or the agreement), recognized that
Cascade was in breach of the 1979 sales agreement, and, in
3Although we refer to the agreement as "the 1982 agreement",
the parties spent some time negotiating its terms, and the
agreement was not entered into until April or May 1983.
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