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Royal Bank account] in repayment of a loan.
3. InterTAN’s enclosed cheque [dated June 30, 1993]
in the amount of US$20,000,000.00 is to be depos-
ited into account number 302-8529-6 in combination
for the issuance of InterTAN Canada Ltd. preferred
shares.
4. The enclosed cheque [dated June 29, 1993] in the
amount of [US]$20,000,000.00 drawn on account
number 302-8529-6 is to then be deposited in
InterTAN’s account number 302-0402-4 in payment
for the redemption of 200,000 InterTAN Canada Ltd.
preferred shares.
On June 30, 1993, pursuant to the June 30, 1993 letter, the
following actions occurred:
1. A check dated June 29, 1993, drawn upon ITC’s Royal Bank
account and payable to petitioner in the amount of $20 million,
was presented to Royal Bank. Pursuant to the June 30, 1993
letter, Royal Bank deposited that check into petitioner’s Royal
Bank account. Royal Bank honored that check, which resulted in
an overdraft of $19,379,772.65 in ITC’s Royal Bank account (ITC’s
overdraft) as of the close of business on June 30, 1993. Royal
Bank permitted ITC’s overdraft because: (1) Pursuant to the
guarantee and assignment agreement, all indebtedness and liabili-
ties of ITC to petitioner were assigned to Royal Bank (assign-
ment) and were postponed to any debt and liabilities of ITC to
Royal Bank, including any funds advanced under any line of credit
by Royal Bank to ITC (postponement), and petitioner was required
to hold in trust for and pay to Royal Bank any money that it
received from ITC; (2) petitioner and ITC made a commitment to
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