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Prior to August 1981, another Kanter entity, Computer
Placement Services, had a $1,729,300 loan outstanding to Holding
Co. In August 1981, $1,500,000 of the loan was converted to
Holding Co. class D preferred stock. In 1983, the stockholder
equity of class D preferred stock was decreased by $1,499,999 and
the paid-in capital was increased by the same amount.
D. Administration Co. and Principal Services: The Banking
Corporations
The funds of the various Kanter entities (as well as the
funds of some of Kanter's associates) were commingled in accounts
held by Administration Co. and later the Principal Services
Accounting Corp. (Principal Services), both of which were also
controlled by Kanter.
Administration Co. was incorporated in the State of Delaware
on September 21, 1981, and was authorized to do business in the
State of Illinois. Administration Co.'s offices were located
either at Kanter's law firm offices or in close proximity
thereto.9
The sole shareholder of Administration Co. was the Pyramid
Trust. Weisgal was trustee of the Pyramid Trust, and Meyers was
the sole beneficiary.
9
Administration Co. was organized at the insistence of some
of the members of Kanter's law firm who complained that law firm
employees working under Kanter were performing extensive nonlegal
services for which the law firm was not being compensated.
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