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TBPC, and TPTC establish the existence of this deferred
compensation agreement. These notes state that each
corporation’s “management extended payment terms related to
certain accrued payables such as officer’s salaries,
indefinitely, subject to cash availability.” There is no
indication in these notes as to the period of time, other than
1989, to which these extended payment terms relate or to the
amount or percentage of compensation that was not paid to Rose.
Moreover, there is no evidence of corporate resolutions and/or
other agreements by PK Ventures, SLPC, TBPC, or TPTC that set
forth the terms of these extended payment arrangements. In
addition, PKV&S’s audited consolidated financial statements for
the years ended December 31, 1990, through December 31, 1993,
made no reference to any extended payment arrangements or to any
deferred compensation arrangement with Rose, and there was no
liability for deferred compensation reported on the Schedules L
attached to PKV&S’s consolidated income tax returns for 1992 and
1993.
When questioned on cross-examination about the existence of
a deferred compensation agreement, Rose testified as follows:
Q [By respondent’s counsel] Did you have an
agreement as of the end of 1991 between yourself and
PK Ventures to defer your compensation for 1991 and
prior years?
A [By Rose] Being a small company, conceptually,
what we did was the real deal. And the real deal was–-
is I did not pay myself, so I deferred it.
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