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2. Interest
The notes executed by petitioner and Drachman stated that
one of the two conditions of the purported loan was that
"[petitioner] pay interest at the rate of six percent (6%) per
annum on the current value of the stock as interest during the
period of the loan." Petitioners paid no interest.
3. Security or Collateral for the Transfers
There is no evidence that petitioners provided, or were even
requested to provide, any security or collateral for the loans.
4. Fixed Maturity Date for Repayment
There was no fixed date for repayment of the loans.
5. Demand for Repayment
Although the record indicates that petitioners' alleged
indebtedness to Drachman was substantial, Drachman made no demand
on petitioners for payment.
6. Actual Repayments
Petitioner testified that he had written small checks to
Drachman, but offered no evidence, e.g., canceled checks, bank
statements, etc., of actual repayment.
Petitioner testified that the only repayment of the supposed
loans from Drachman was in the form of debt; i.e., shares,
forgiven. At Christmas time, Drachman would give equal shares of
stock to his grandchildren. Petitioners introduced letters
prepared by Drachman from Christmas 1987 and 1989 where Drachman
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Last modified: May 25, 2011