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team and its assets, is entitled to allocate a portion of the
acquisition price to its leasehold interest in the Superdome.
The parties have stipulated that petitioner's leasehold interest
is an intangible asset that is used in petitioner's business and
in the production of income. They have also agreed that the
leasehold has a limited useful life corresponding to the term
established by the Revised Lease. Additionally, the parties have
stipulated that if any portion of the acquisition price is
allocable to the Superdome leasehold, the amount so allocable
will be $16 million. Accordingly, we must decide whether
petitioner is entitled to allocate any portion of the price it
paid to acquire the Saints to its Superdome leasehold.
Petitioner advances two arguments in its attempt to refute
respondent's determination. Petitioner's principal argument is
that the Revised Lease, because of what petitioner characterizes
as "mutual conditionality" between the Sales Contract and the
Revised Lease, was an asset among those acquired from the Mecom
Group, and that a portion of the acquisition price is therefore
allocable to the Superdome leasehold.
Petitioner also argues that irrespective of whether the
Revised Lease is construed as being an asset among those received
from the Mecom Group, the 1975 Lease, which was the lease
actually transferred to petitioner, had value immediately prior
to the formation of the Revised Lease, and that it is to that
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