PK Ventures, Inc. and Subsidiaries, et al. - Page 107

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          “Mortgages, notes, and bonds payable in 1 year or more” on the              
          Schedule L attached to PKVI LP’s Form 1065 for 1989.                        
               PKVI LP renegotiated its loan agreement with MGFP during               
          1990.  The renegotiated loan agreement between PKVI LP and MGFP             
          was for the principal balance of $401,284, an amount that                   
          included the $328,500 principal balance from their original loan            
          agreement plus $72,784 of accrued interest.                                 
               As of December 31, 1990, PKVI LP had the following loan                
          agreements outstanding:                                                     
                                                          Outstanding                 
                                             Interest  Principal Balance              
                Lender       Maturity Date     Rate      as of 12/31/90               
             Liberty Life    Dec. 1, 1998     10.50%       $559,372                   
             Liberty Life    Apr. 1, 2001      10.70       762,224                    
             Liberty Life    Aug. 20, 2001     11.35       387,716                    
             MGFP            Dec. 31, 1991     10.00       401,284                    
          As of that date, the outstanding principal balances of the                  
          transfers associated with these agreements totaled $2,110,596.              
               On the Balance Sheet included in PKVI LP’s audited financial           
          statements for the year ended December 31, 1990, PKVI LP’s                  
          “Current portion of long-term debt” was listed as $403,473, and             
          its “LONG-TERM DEBT DUE AFTER ONE YEAR” was listed as $1,829,201.           
          On the Schedule L attached to PKVI LP’s Form 1065 for 1990,                 
          “Mortgages, notes, and bonds payable in less than 1 year” was               
          listed as $425,000 as of the end of that year, and “Mortgages,              
          notes, and bonds payable in 1 year or more” was listed as                   
          $1,685,596.                                                                 





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