-105-
condominium conversion projects at Calais, Chatham, Valleybrook,
and Galaxy Towers, and (2) “Two Participation Agreements with
Burton J. Kanter regarding certain condominium conversions.
These agreements have been terminated with respect to new
conversions.” Exh. 223, app. A., pt. II, at 5-8. The BJF
Partnership agreement included representation and warranty
clauses under which Kanter stated that (1) he did not need any
consent, authorization, or approval to contribute the
participation agreements to the partnership, (2) the terminations
of the participation agreements were valid, binding, and
effective, and (3) THC is a corporation owned by a trust all the
beneficiaries of which are Kanter family members. Id. at 65, 70,
par. 8.4(c).
THC did not make any direct cash contributions to BJF
Partnership when it acquired its limited partnership interest. A
June 20, 1984, letter to Kanter from a law firm involved in the
matter indicated (1) THC was obliged to make a $29,913 cash
contribution to the partnership, (2) THC owed $86,789 to FWID for
making cash equivalent contributions on THC’s behalf, and (3) THC
should issue a secured note to FWID in the amount of $88,387 for
contributing other assets to the partnership’s capital on THC’s
behalf. Exh. 5802. On December 31, 1984, however, TSG Holdings
purchased additional interests in BJF Partnership from THC and
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