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-36- Sometime in late June or early July, 1968, Matz calculated that he owed Governor Agnew approximately $20,000 on the basis of 5% of the fees that his company had already received from the state. He reviewed this calculation with Childs, who agreed with it. They did. .not believe that they could safely generate this amount of cash from within the company and, therefore, decided to go outside the company... Matz approached an old client and friend of his who was in a business in which he customarily dealt in large sums of cash. . . . _ Since Matz knew that he would be receiving substantial fees from the state within the next several months, on which he would owe Governor Agnew approximately an additional $10,000, he told his friend that he needed $30,000 in cash in the very near future. He did not disclose to his friend why he needed this money. They agreed upon the following scheme: Mate's company would by corporate check "lend" his friend’ $30,000; his friend would then generate $30,000 in cash through his own company which he would return to Matz. The "loan" would be repaid to Matz's company by $1,700 quarterly checks for principal and interest; and Matz would return these "loan repayments" to his friend in cash. This scheme was satisfactory to Matz because his regular procedures were adequate to generate $1,700 in cash on a quarterly basis. The friend reluctantly agreed to assist Matz in this manner. He immediately generated $20,000 in cash, which he delivered to Matz. Matz showed this $20,000 in cash to Childs before he delivered it to ‘Governor Agnew. The friend promised that he would. supply Matz with the -additional'$10,000 in cash as soon as he could generate it, and-he did so within the following several months. Thereafter, the "loan" repayment scheme was implemented.