-55-
of Carlco’s, TMT’s, or BWK’s corporate minutes books, stock
ledgers, or stock registers after 1984.
During this period, Kanter recommended and proposed to
Freeman (IRA’s president) and Weisgal (trustee of the Bea Ritch
Trusts, which held 100 percent of IRA’s common stock) that
generally Carlco and TMT should each receive a 45-percent share
of IRA’s available investment funds and that BWK should receive
the remaining 10 percent of IRA’s available investment funds.
Kanter testified that the distribution of IRA’s funds to
Carlco, TMT, and BWK in a 45/45/10 percent split represented (1)
a “free-cashflow asset allocation” he and Freeman devised, and
(2) an effort to diversify IRA’s investments. Kanter, Transcr.
at 3663-3666, 3690-3691, 3694-3695. The diversification of
investments was to be achieved by having Lisle manage Carlco and
invest principally in municipal bonds, Ballard manage TMT and
invest principally in real estate, and Kanter manage BWK and make
miscellaneous investments. Id.; Ballard, Transcr. at 222.31
Kanter, in fact, did not have time to manage BWK’s investments.
Kanter, Transcr. at 3695.
31 As shown in additional findings of fact regarding the
flow of funds, see infra pp. 162, 187-188: (1) IRA did not
allocate all of its free cashflow to Carlco, TMT, and BWK during
the period in question, and (2) in addition to real estate
investments, Ballard invested substantial amounts of TMT’s funds
in cash and municipal bonds.
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