PK Ventures, Inc. and Subsidiaries, et al. - Page 112

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          promissory note, he did not intend to have PKVI LP repay any of             
          this amount to PK Ventures.  In addition, Rose, as a general                
          partner with a 70-percent interest in PKVI LP, did not intend to            
          repay any of this amount to PK Ventures at the time that he                 
          signed the $1,516,246 promissory note.                                      
               No legal action was taken by PK Ventures against Rose to               
          force repayment of the $1,516,246 promissory note.  Rose owned              
          approximately 85 percent of the stock of PK Ventures during 1991.           
               In a letter dated July 6, 1992, to Douglas W. Kroske,                  
          C.F.A., senior vice president of Liberty Capital Advisors, Inc.,            
          Rose made the following statements concerning the transfers from            
          PK Ventures, TBPC, and TPTC to PKVI LP:                                     
               Since 1986, PK Ventures Inc has invested over                          
               $1.5 million in these hydroelectric projects, and is                   
               willing to continue but needs some help from Liberty                   
               Life.  * * *                                                           
                         *    *    *    *    *    *    *                              
               There has been a delay on the financial statements for                 
               the year ending 12/31/91.  During the year based on                    
               Ernst & Young’s review, $419,996 cash was provided to                  
               the Partnership from PK Ventures, Inc.  Since inception                
               to 12/31/91 a total amount of $1,516,246 has been                      
               injected, and our auditors are now going to make                       
               PK Ventures Inc write this off as it is an                             
               uncollectible claim against the Partnership.  The                      
               $419,996 cash of 1991, was used approximately for                      
               equipment and Bynum canal repairs of $225,661, and the                 
               balance used in payments to Liberty Life.                              










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