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increased to $5,350,000. On June 13, 1994, Mrs. Harrison, Myron,
and Ralph, and, on June 14, 1994, James separately executed
continuing guaranties of “any and all indebtedness” of petitioner
and Rentals to Bank of America up to the sum of $7.5 million.
Loan 2 increased the overall line of credit from Bank of America
to petitioner and Rentals to approximately $7 million.
On August 25, 1995, Mrs. Harrison, Myron, Ralph, and James
jointly and severally guaranteed the obligations of petitioner
and Rentals as lessees under a truck lease with an independent
third party, BA Leasing & Capital Corp., as lessor. A corporate
resolution executed on the same date by Myron and Ralph on behalf
of petitioner limited the aggregate cost of the trucks subject to
the lease to $1 million.
After the audit years, on April 14, 1998, Mrs. Harrison, as
trustee of the Survivor’s Trust, created under the E.J. Harrison
Family Trust, and James and Mary Harrison, as trustees of the
James E. Harrison Family Trust, executed a continuing guaranty in
favor of Bank of America securing a line of credit to petitioner
and Rentals in the sum of $16 million. That guaranty replaced
the earlier, lesser guaranties executed during the audit years.
During the audit years, petitioner used the line of credit
from Bank of America to place in service equipment costing in
excess of $3.6 million. Petitioner has never defaulted on any of
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