John W. Madden, Jr., et al. - Page 10

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          in any event, the rent will not be less than $120,000 per year.             
          The Second Lease also imposes certain obligations on the Museum.            
          First, the Museum is required to use its best efforts with                  
          respect to obtaining any necessary permits.  Second, the Museum             
          is required to maintain the property and secure it from damage.             
          Third, the Museum is obligated to arrange for 5,000 parking                 
          spaces.  In order to arrange for the parking spaces, the Museum             
          entered into parking license agreements with building owners in             
          the Greenwood Plaza complex.  Pursuant to these licenses, the               
          building owners agreed to make their buildings' parking spaces              
          available to concert patrons, and in return the Museum agreed to            
          arrange for security and cleanup of the parking areas.  Finally,            
          the Second Lease contains a sublease clause.  Under this clause,            
          MCA must remit 25 percent of the sublease rentals to the Museum.            
          The sublease rentals are defined as the gross receipts received             
          by MCA from the sublessees less any out-of-pocket expenses                  
          incurred by MCA in connection with the subleases.                           
          Self-Dealing Transactions                                                   
               Petitioner is a disqualified person, as defined by section             
          4946(a)(1), with respect to the Museum.  Petitioner admits that             
          on June 5, 1985, the Museum and petitioner engaged in a self-               
          dealing transaction.  He also admits that, on July 12, 1985, he             
          and the Museum engaged in a self-dealing transaction.  Petitioner           
          concedes that he owes the first tier excise tax under section               
          4941(a)(1) on the self-dealing transactions.                                




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