Affiliated Foods, Inc. - Page 14

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          amount of cash they wanted and the denominations thereof.  Based            
          upon these written instructions, petitioner obtained cash from              
          the Amarillo National Bank.  Petitioner placed the cash requested           
          by each vendor in a separate bank bag supplied by the Amarillo              
          National Bank.  The bank bags were identified by a number                   
          assigned to the individual vendors.  Immediately before the shows           
          began, petitioner made the bank bags available to the vendors at            
          a central location.  Each vendor was required to sign for the               
          bank bag at the time it obtained its requested cash.  At the                
          conclusion of the food shows, the vendors returned to petitioner            
          the bank bags and any unused cash.  Petitioner maintained a                 
          record of the amount of cash given to each vendor, the source of            
          that cash, and the amount of any cash returned to petitioner at             
          the conclusion of the food show.                                            
               As indicated above, each page in the food-show book had a              
          perforated tear strip.  At the food show, representatives of the            
          member stores placed their merchandise orders on the tear strip             
          and turned them into the vendors.  The vendor made the product              
          promotional payments, then gave the tear slip to petitioner.                
          Subsequently, petitioner would order the merchandise, deliver it            
          to the member stores, and bill the member stores.  The tear                 
          strips had the amount of the product promotional allowance on               
          them.  However, petitioner destroyed these records.                         

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Last modified: May 25, 2011