ACM Partnership, Southampton-Hamilton Company, Tax Matters Partner - Page 124

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          interest was offset by the appreciation of the fixed-rate cash              
          flows that it was obligated to pay relative to the floating rate            
          cash flows it was entitled to receive under the Colgate debt                
          swaps.  Kannex owed ABN Cayman Islands $3,180,453.  For reasons             
          that the record does not disclose, the amount Kannex paid was               
          higher by $1,655,000, and this excess was credited to den Baas'             
          Financial Engineering Group.  The back-to-back hedge swaps                  
          between Kannex and ABN New York and ABN New York and Merrill                
          Capital were also terminated at the same time.  Although the                
          terms of the swaps were identical, for reasons not disclosed in             
          the record, the termination payment that ABN New York made to               
          Kannex was $500,000 less than the termination payment that was              
          received from Merrill Capital.  Kannex's balance sheet for the              
          period ended January 27, 1992, shows remaining stockholder's                
          equity of $17,278.  Of this amount, $6,000 was attributable to              
          the loans that Kannex had originally made to the foundations to             
          finance their contributions and the rest may have been                      
          attributable to a capitalized loan from ABN.  All the proceeds of           
          Kannex's participation in ACM were, in one way or another,                  
          remitted to ABN.  Liquidation procedures commenced in the                   
          following month.                                                            
                                       OPINION                                        
               ACM structured its sale of the Citicorp Notes to fall within           
          the contingent payment sale provisions of section 15a.453-1(c),             






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