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petitioner had taken $70,000 from an account in his name (Albank
No. 3) (which amount he had taken earlier in the year from IL NA
Tours) and placed it into the Sam Han account. Also, on March 9,
petitioner had taken $80,000 from a corporate account of SF NA
Tours and placed it into the Sam Han account.
Belofsky was not made aware of the Guaranty or its terms
before petitioner signed it. After learning of the Guaranty,
Belofsky on March 28 protested its execution and validity to
Hasman, arguing that petitioner had signed the Guaranty without
benefit of counsel and without consideration, and therefore that
it should be returned to petitioner.
Interim Agreement
On April 7, 1988, petitioner entered into an interim
agreement (Interim Agreement) with Northwest, on behalf of
himself, IL NA Tours, NY NA Tours, and Air America. In the
Interim Agreement, Northwest agreed to give petitioner’s
corporations 1,000 tickets of Northwest ticket stock subject to
prepayment requirements and strict accounting rules, which
included petitioner’s agreement to pay Northwest $500,000 as a
partial prepayment for the ticket stock. Petitioner admitted in
the Interim Agreement that petitioner’s corporations had received
proceeds from the sale of Northwest ticket stock to subagents
which had not been forwarded to Northwest. Petitioner further
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