Barry B. Bealor and Nancy L. Bealor, et al. - Page 115

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          percent demand note dated July 1, 1984.  Qulart then lent                   
          $3,035,000 to the 21 investors in MIT 84.  The MIT 84 partners              
          then allegedly directed Qulart to pay the $3,035,000 that they              
          had borrowed from Qulart directly to MIT 84.  MIT 84 completed              
          the investment circle by endorsing the $3,035,000 Machise zero-             
          percent demand note back to Machise.  Because Machise had its own           
          note back, that note was retired.                                           
               In addition to the notes, the investors were required to put           
          up, in the aggregate, $303,500 in cash as the other one-eleventh            
          of their capital investment in MIT 84.  None of the investors in            
          MIT 84 initially paid this one-eleventh in cash to MIT 84.                  
          Instead, they issued short-term notes to BBPA, which had set up a           
          line-of-credit arrangement with MIT 84.  The investors’ short-              
          term notes to BBPA were dated January 1, 1984, and were payable             
          July 1, 1984, with interest at the annual rate of 15 percent.               
          The investors fully paid these notes to BBPA in 1984.  During               
          1984, BBPA advanced $182,100 of this amount to Machise, pursuant            
          to a second line-of-credit note, executed by Machise in favor of            
          BBPA.                                                                       
               During 1984, Machise made transfers totaling $4,183,049 to             
          the MIT 84 payroll account.  The employees and independent                  
          contractors were paid with checks on this account that were                 
          signed by Bucci.                                                            
               In addition to the payroll costs, on December 21, 1984, MIT            
          84 issued a check to MITA, in the amount of $400,000, as the                




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