Timothy J. and Joan M. Miller - Page 5

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               Under the MMS/Huntington Loan line of credit, MMS was                  
          allowed advances of up to $250,000 per modular or mobile                    
          diagnostic unit under contract.  Interest at a rate of one-half             
          point above Huntington's prime rate was payable monthly on the              
          outstanding principal advanced.  MMS executed a promissory note             
          and granted Huntington a first security interest in MMS's                   
          accounts, inventory, equipment, fixtures, and receivables as                
          security for the MMS/Huntington Loan.  In addition, petitioner              
          executed an unlimited guaranty for MMS's indebtedness, secured by           
          a second mortgage on his personal residence, and each member of             
          the Rapp Group executed limited guaranties which in the aggregate           
          were equal to the entire $1 million authorized indebtedness.  The           
          Rapp Group guaranties were collateralized with shares of Danek              
          Group, Inc. (Danek), a publicly traded stock with an aggregate              
          value that exceeded $1,000,000 when the MMS/Huntington Loan was             
          executed.                                                                   
               MMS's annual operating losses accumulated, and petitioner              
          had insufficient basis in the corporation to deduct them                    
          currently.  As of December 31, 1991, petitioner had suspended net           
          operating loss deductions from MMS as follows:                              
               Suspended net operating loss from 1990   $540,506                      
               Suspended net operating loss from 1991     87,322                      
                                        Total            627,828                      









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