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SLPC’s pipeline was taken out of service sometime prior to
January 1, 1992, for environmental reasons.
There were no direct references made to this litigation in
PKV&S’s audited consolidated financial statements for the year
ended December 31, 1991. Note 5 of these financial statements,
however, stated, in pertinent part, that: “The Company has not
repaid $1,300,000 of subordinated notes payable to the former
shareholders of its subsidiaries pending the resolution of
various claims against the former shareholders.”
C. Transfers From Rose to PK Ventures
As of the beginning of October 1992, PK Ventures owed
$1.3 million to the TPTC sellers. This amount was to have been
paid by January 1, 1992. This debt was settled in October 1992
when PK Ventures agreed to pay the TPTC sellers $590,000. Rose
transferred the $590,000 to PK Ventures in October 1992 so that
it could pay the TPTC sellers. PK Ventures was relieved of the
remaining balance of this $1.3 million debt.
In sum, Rose made cash transfers to PK Ventures totaling
$990,000 during 1992. Of this $990,000, Rose transferred
$940,000 during the last quarter of 1992. PK Ventures executed
documents that were identical to the PKVI LP promissory notes
described above in favor of Rose with respect to these transfers.
These documents were signed by Rose alone; they were neither
attested to by a witness nor notarized.
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