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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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Last modified: May 25, 2011