- 5 -
cash and the remainder was financed through notes. The notes
provided that 10 percent of the amount thereof was recourse but
that the recourse portion was due only after the nonrecourse
portion had been paid in full. All of the monthly payments
required among the entities in the above transactions offset each
other.
In Provizer v. Commissioner, supra, we found that the market
value of a Sentinel EPE recycler in 1981 did not exceed $50,000
and that the nuts and bolts, or manufacturing, cost was $18,000.
Other recycling machines were commercially available during the
years in issue in Provizer, including the Buss-Condux
Plastcompactor, Nelmor/Weiss Densification System (Regenolux),
Cumberland Granulators, and Foremost Densilator. Information
regarding these other machines was readily available.
B. Petitioner and His Introduction to the Plastics Transactions
Petitioner received a bachelor of science degree from New
York University and has completed post-graduate courses at
Harvard University.
Petitioner is a businessman who was active in the plastics
industry from at least 1958 until 1989. At one time or another
during his career as a business executive, petitioner has been
the chief executive officer (CEO) of approximately 12 different
plastics-related companies, which collectively employed many
individuals. In 1981 and 1982 in particular, petitioner was the
CEO of Gotham Chicago Corp. (Gotham Corp.), a steam chest molding
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