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obligations to the U.S. Government in the aggregate amount of
$163,014; and (3) $71,567 as the balance owed to Harleysville
National Bank.5
On or about April 15, 1996, Self Oil and petitioner entered
into an assignment and assumption agreement (assignment
agreement). According to the assignment agreement, petitioner
assumed the following Self Oil obligations: (1) $445,419 in
loans outstanding to Mr. Self, Sr., and his wife; (2) $56,567 in
loans outstanding to Harleysville National Bank;6 and (3)
$163,014 in obligations to the U.S. Government with respect to
Self Oil’s guilty plea agreement. Subsequently, Self Oil and
petitioner orally agreed that the consideration that petitioner
provided would comprise the following: (1) Petitioner’s
assumption of a portion of the debt Self Oil owed to Mr. Self,
Sr., and his wife totaling $262,986; (2) petitioner’s assumption
of fines and forfeitures Self Oil owed to the United States
totaling $163,014;7 and (3) petitioner’s assumption of a portion
5The payments to Harleysville National Bank and to Mr. Self,
Sr., set forth in the agreements were based on projected
collections of Self Oil’s accounts receivable being sufficient to
pay off Harleysville National Bank’s obligations in full and
repay Mr. Self, Sr.’s loan.
6See supra note 5.
7When Self Oil transferred its assets to petitioner, it owed
the United States $163,014 in fines and penalties that Mr. Self,
Sr., had guaranteed and petitioner paid.
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