Hubert Enterprises, Inc. and Subsidiaries, et al. - Page 27

                                        -27-                                          
               F.  2000 RFC Equipment                                                 
               On April 30, 2000, CRG purchased computer equipment (2000              
          RFC equipment) from RFC for $9,181,432 and leased the 2000 RFC              
          equipment back to RFC.  Pursuant to promissory notes dated                  
          April 30, 2000, CRG promised to pay RFC $663,400 and $8,080,320             
          as to the purchase.                                                         
               Also on April 30, 2000, LCL purchased the 2000 RFC computer            
          equipment (subject to the lease) from CRG for $9,181,432.                   
          Pursuant to promissory notes dated April 30, 2000, LCL promised             
          to pay CRG $663,400 and $8,029,222.  No individual member of LCL            
          signed or directly guaranteed the notes, the latter of which                
          stated it was recourse to the extent of $3.225 million and that             
          payments of principal and interest would be applied first to the            
          recourse portion.  For each of its taxable years ended in 2000              
          and 2001, LCL reported as to the 2000 RFC equipment the following           
          amounts of lease income, interest expense, depreciation, “G&A”              
          expense and interest income, and loss:                                      
          2000          2001                                                          
          Lease Income                -0-      $1,545,155                             
          Interest expense        ($205,190)     (508,995)                            
          Depreciation           (1,836,287)   (2,938,058)                            
          Net G&A expense and                                                         
          interest income            -0-           9,848                              
          Loss                    2,041,477     1,892,050                             
          The portions of these losses allocated to HBW’s 99-percent                  
          ownership interest were $2,021,062 and $1,873,130 respectively.             







Page:  Previous  17  18  19  20  21  22  23  24  25  26  27  28  29  30  31  32  33  34  35  36  Next

Last modified: May 25, 2011