Barry B. Bealor and Nancy L. Bealor, et al. - Page 132

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          pending in docket No. 3462-92.  Respondent has agreed that such             
          an adjustment would be appropriate if we so determine.                      
               On January 1, 1988, Fred prepared a Termination Agreement to           
          end the obligations of MIT 86 and MPC under the employee leasing            
          agreement.  MPC owed $4,266,993.53 to MIT 86 pursuant to the                
          employee leasing agreement.  Under the Termination Agreement, MPC           
          offered to pay $3,175,000 to MIT 86 by transferring to MIT 86 the           
          $3,080,000 note made by Qulart to Machise, now held by MPC, with            
          a balance, including accrued interest, of $3,175,000.67.  No                
          formal assignment of this amount took place, however.                       
               The Termination Agreement also recited that, after MPC                 
          assigned the Qulart note to MIT 86, the balance due to MIT 86               
          would be $1,091,992.86.  The Termination Agreement further                  
          provided that MIT 86 had agreed to reduce that balance by                   
          $14,685.86 and to cancel the 10-percent annual late charge.  Fred           
          computed the net amount due to MIT 86, some $1,077,307, so that             
          it would equal the amount that he had projected as the aggregate            
          income to the MIT 86 investors.                                             
               Additionally, under the Termination Agreement, MIT 86 was              
          required to distribute the Qulart note to its partners.  They               
          were to direct MIT 86 to assign that note back to Qulart, the               
          note's maker, in payment of amounts they owed Qulart on their               
          investor notes.  No formal assignment of this note, however, was            
          ever made.                                                                  






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